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KBRA Assigns Preliminary Ratings to Foursight Capital Automobile Receivables Trust 2020-1

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Kroll Bond Rating Agency (KBRA) announces the preliminary ratings to six classes of notes issued by Foursight Capital Automobile Receivables Trust 2020-1 ("FCRT 2020-1"), a subprime auto asset-backed securities transaction.

FCRT 2020-1, represents the eighth rated term ABS securitization for Foursight Capital LLC ("Foursight" or the "Company") and the fourth rated by KBRA. FCRT 2020-1 will issue six classes of notes in an aggregate principal amount of $215 million. This transaction has a sequential pay structure and is backed primarily by a pool of near-prime automobile loan contracts that are secured by new and used vehicles. Credit enhancement consists of subordination (except for the Class F Notes), overcollateralization, a reserve account funded at closing and with each additional funding, and excess spread. Foursight will use the net proceeds from the issuance of the notes to pay down existing warehouse debt and for general operating purposes.

The Company is a Utah based automobile finance company that has been in business since 2012. The Company provides automobile loans to prime, near-prime and subprime borrowers who have experienced prior credit difficulties or have limited credit histories with credit bureau scores typically ranging from 580 - 700. Foursight was formed in Q4 2012 by an experienced senior management team that previously led Franklin Capital Corporation ("Franklin Capital") and is a wholly-owned subsidiary of Jefferies Financial Group Inc. ("Jefferies"), a publicly listed (NYSE:JEF) diversified financial services company with $10.0 billion in total equity and $6.0 billion in cash and cash equivalents as of September 30, 2019. Jefferies is also providing a servicer guarantee that guarantees the covenants and obligations of the servicer in the transaction documents.

KBRA applied its Global Auto Loan ABS methodology as part of its analysis of the transaction's underlying collateral pool, the proposed capital structure and Foursight's historical static pool data. KBRA also conducted an operational assessment of the Company, as well as a review of the transaction's legal structure and transaction documents. KBRA will also review the operative agreements and legal opinions for the transaction prior to closing.

Preliminary Ratings Assigned: Foursight Capital Automobile Receivables Trust 2020-1

Class

Preliminary Rating

Initial Principal Balance

A-1

K1+ (sf)

$25,200,00

A-2

AAA (sf)

$83,340,000

A-3

AAA (sf)

$40,000,000

B

AAA (sf)

$14,520,000

C

AA+ (sf)

$14,300,000

D

AA- (sf)

$14,070,000

E

A- (sf)

$11,840,000

F

BBB- (sf)

$11,730,000

To access ratings, reports and disclosures, click here.

Related Publications: (available at www.kbra.com)

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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 designated as a designated rating organization by the Ontario Securities Commission for issuers of asset-backed securities to file a short form prospectus or shelf prospectus. KBRA is also recognized by the National Association of Insurance Commissioners as a Credit Rating Provider, and is 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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