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Fitch Affirms Ally Master Owner Trust Outstanding Notes; Outlook Stable

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NEW YORK--(BUSINESS WIRE)--

Fitch Ratings has affirmed the following outstanding notes from series issued by Ally Master Owner Trust (AMOT) as a result of its annual review of the trust:

Series 2012-4

--$175,000,000 class A notes at 'AAAsf'; Outlook Stable;

--$13,095,000 class B notes at 'AAsf'; Outlook Stable;

--$9,524,000 class C notes at 'Asf'; Outlook Stable;

--$7,143,000 class D notes at 'BBBsf'; Outlook Stable.

The class E notes are not rated.

Series 2012-5

--$1,100,000,000 class A notes at 'AAAsf'; Outlook Stable;

--$82,313,000 class B notes at 'AAsf'; Outlook Stable;

--$59,864,000 class C notes at 'Asf'; Outlook Stable;

--$44,898,000 class D notes at 'BBBsf'; Outlook Stable.

The class E notes are not rated.

Series 2014-1

--$600,000,000 class A-1 notes at 'AAAsf'; Outlook Stable;

--$400,000,000 class A-2 notes at 'AAAsf'; Outlook Stable.

The class B, C, D and E notes are not rated.

Series 2014-4

--$325,000,000 class A-1 notes at 'AAAsf'; Outlook Stable;

--$650,000,000 class A-2 notes at 'AAAsf'; Outlook Stable.

The class B, C, D and E notes are not rated.

Series 2014-5

--$225,000,000 class A-1 notes at 'AAAsf'; Outlook Stable;

--$775,000,000 class A-2 notes at 'AAAsf'; Outlook Stable.

The class B, C, D and E notes are not rated.

Series 2015-1

--$300,000,000 class A notes at 'AAAsf'; Outlook Stable.

The class B, C, D and E notes are not rated.

Series 2015-2

--$100,000,000 class A-1 notes at 'AAAsf'; Outlook Stable;

--$100,000,000 class A-2 notes at 'AAAsf'; Outlook Stable.

The class B, C, D and E notes are not rated.

Series 2015-3

--$675,000,000 class A notes at 'AAAsf'; Outlook Stable.

The class B, C, D and E notes are not rated.

KEY RATING DRIVERS

Quality of Wholesale Receivables: The trust receivables are floorplan financing lines to financially stable and strong dealers for primarily new vehicles (88.7%). 79.2% of the receivables were aged 1 to 120 days and only 5.3% of the receivables were aged over 270 days. The receivables are geographically diverse with.

Strength of Dealer Network: Based on a review of dealer financial metrics and Ally's internal dealer credit classifications, the financial health of Ally's dealer network is viewed as stable, with the majority of dealers profitable through 2Q 2016. Historically high vehicle sales and the strength of the used vehicle market over the past five years have had positive effects on dealer financial health.

Stable Performance: AMOT is experiencing consistent performance trends, including stable monthly payment rates (MPRs), asset yield, low agings and minimal dealer defaults and trust losses. With vehicle sales plateauing and inventory levels expected to rise heading into 2017, Fitch expects trust performance metrics to normalize in the next couple of years but remain healthy.

Sufficient Credit Enhancement: Each series of notes benefits from subordination and a reserve account. Structural features such as early amortization triggers mitigate risks of under-performance and exposure to dealer/manufacturer defaults.

Asset Concentrations: Receivables in the trust are subject to concentration limits mitigating the risk of individual dealer defaults and losses. Exposure to individual vehicle types, manufacturers and segments are mitigated with concentration limits in place.

Consistent Origination and Servicing: Ally demonstrates adequate abilities as originator and servicer, as evidenced by the historical delinquency and loss performance of AMOT.

Legal Analysis: The legal structure of the transaction provides that a bankruptcy of Ally would not impair the timeliness of payments on the securities.

RATING SENSITIVITIES

To conduct a rating sensitivity for the outstanding notes, under a category B DFP platform, Fitch assumes portfolio default levels at 5%, 10%, and 15% and under two recovery-level scenarios of 50% and 30%. Fitch modeled each series with the assumption that the above defaults have occurred, reflecting asset performance in a stressed environment. However, to date, performance for the trust has remained strong. A material deterioration would have to occur in performance to have potential negative impact on the ratings for each series.

USE OF THIRD-PARTY DUE DILIGENCE PURSUANT TO SEC RULE 17G-10

Form ABS Due Diligence-15E was not provided to, or reviewed by, Fitch in relation to this rating action.

Additional information is available at www.fitchratings.com.

Applicable Criteria

Counterparty Criteria for Structured Finance and Covered Bonds (pub. 01 Sep 2016)

https://www.fitchratings.com/site/re/886006

Global Rating Criteria for Dealer Floorplan ABS (pub. 05 May 2016)

https://www.fitchratings.com/site/re/880077

Global Structured Finance Rating Criteria (pub. 27 Jun 2016)

https://www.fitchratings.com/site/re/883130

Related Research

Ally Master Owner Trust, Series 2012-4 -- Appendix

https://www.fitchratings.com/site/re/684144

Ally Master Owner Trust, Series 2012-5 -- Appendix

https://www.fitchratings.com/site/re/691210

Ally Master Owner Trust, Series 2014-1 -- Appendix

https://www.fitchratings.com/site/re/732561

Ally Master Owner Trust, Series 2014-4 -- Appendix

https://www.fitchratings.com/site/re/751752

Ally Master Owner Trust, Series 2014-5 -- Appendix

https://www.fitchratings.com/site/re/808630

Ally Master Owner Trust, Series 2015-1 & Series 2015-2 -- Appendix

https://www.fitchratings.com/site/re/861475

Ally Master Owner Trust, Series 2015-3 -- Appendix

https://www.fitchratings.com/site/re/866393

Additional Disclosures

Dodd-Frank Rating Information Disclosure Form

https://www.fitchratings.com/creditdesk/press_releases/content/ridf_frame.cfm?pr_id=1015056

Solicitation Status

https://www.fitchratings.com/gws/en/disclosure/solicitation?pr_id=1015056

Endorsement Policy

https://www.fitchratings.com/regulatory

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