Market Overview

KBRA Assigns Preliminary Ratings to NYCTL 2018-A Trust


Kroll Bond Rating Agency (KBRA) announces the preliminary ratings on the
bonds of NYCTL 2018-A Trust, a property tax lien ABS transaction.

This transaction represents the 24th sale and subsequent term
securitization of tax liens by The City of New York (the "City"). The
collateral pool is comprised of 3,554 property tax liens with an
aggregate initial adjusted redemptive value (equal to the redemptive
value plus recoverable lien administration expenses as of such date) of
approximately $91.0 million. This includes approximately $58.6 million
aggregate initial redemptive value of tax liens in the first sale on the
closing date and approximately $32.5 million aggregate initial adjusted
redemptive value of tax liens in the second sale in July 2018 (the
"Second Sale Tax Liens"). The tax liens arose from unpaid real property
taxes, assessments, sewer rents, sewer surcharges, water rents and other
charges imposed by the City, in the case of water and sewer charges, the
New York City Water Board. The underlying properties are located in the
five boroughs of the City.

The borough of Brooklyn represents approximately 35.00% of the initial
pool by redemptive value, while Queens, the Bronx, Manhattan and Staten
Island represent 30.00%, 12.70%, 16.40% and 5.90% respectively. The
property types in the initial collateral pool consist of residential
(63.98%), commercial and industrial (30.96%) and vacant land (5.05%).

As part of the transaction, a working capital reserve fund with an
initial balance of $3.4 million may be used to pay certain lien
administration expenses. In addition, the transaction features an
interest reserve fund with a required minimum balance initially equal to
three months of interest on the original principal balance of the bonds
and remains equal to such amount until such amount is equal to or
greater than six months of interest on the outstanding bond balance.
Pursuant to the transaction documents, the Indenture Trustee is also
required to advance the lesser of $7.5 million or 10% of the then
current aggregate tax lien principal balance to pay interest on the
bonds, providing additional liquidity to the transaction.

Credit enhancement is comprised of overcollateralization, an interest
reserve fund, excess spread and amounts in the working capital reserve
fund. The credit enhancement levels for the bonds are sufficient to
cover KBRA's corresponding stressed cash flow assumptions for the bonds.
The transaction is structured to de-lever rapidly through a "full turbo"
pay structure designed to limit the amount of tail risk for bondholders.
This de-leveraging increases the level of credit enhancement over time,
which is beneficial to the maintenance of the bond ratings.

KBRA used the Property
Tax Lien ABS Rating Methodology
to analyze the transaction's
underlying collateral pool, the proposed capital structure and the
City's historical performance data.

The preliminary ratings are based on information known to KBRA at the
time of this publication. Information received subsequent to this
release could result in the assignment of final ratings that differ from
the preliminary ratings.

Preliminary Ratings Assigned: NYCTL 2018-A Trust

Bonds       Rating       Initial Principal Balance
Class A       AAA (sf)       $74,659,000

Representations & Warranties Disclosure

All Nationally Recognized Statistical Rating Organizations are required,
pursuant to SEC Rule 17g-7, to provide a description of a transaction's
representations, warranties and enforcement mechanisms that are
available to investors when issuing credit ratings. KBRA's disclosure
for this transaction can be found in the report available here.

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About KBRA and KBRA Europe

KBRA is a full service credit rating agency registered with the U.S.
Securities and Exchange Commission as an NRSRO. In addition, KBRA is
recognized by the National Association of Insurance Commissioners as a
Credit Rating Provider and a certified Credit Rating Agency (CRA) by the
European Securities and Markets Authority (ESMA). Kroll Bond Rating
Agency Europe Limited is registered with ESMA as a CRA.

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