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KBRA Assigns Preliminary Ratings to SpringCastle Funding Asset-Backed Notes 2019-A
[May 20, 2019]

KBRA Assigns Preliminary Ratings to SpringCastle Funding Asset-Backed Notes 2019-A


Kroll Bond Rating Agency (KBRA) assigns preliminary ratings to three class of SpringCastle Funding Asset-Backed Notes 2019-A ("SCFT 2019-A"), a consumer loan asset-backed securities transaction.

This transaction is a refinancing of the SpringCastle Funding Asset-Backed Notes 2016-A transaction ("SCFT 2016-A"). The collateral in the SCFT 2019-A includes approximately $938.7 million of loans as of the April 30, 2019 initial cut-off date. The preliminary ratings reflect the initial credit enhancement levels of 10.00% for the Class A notes, 2.50% for the Class B notes, and 0.50% for the Class C notes, and target credit enhancement levels of 10.80%, 3.30%, 1.30% for the Class A, Class B, and Class C notes, respectively. Credit enhancement is comprised of overcollateralization, subordination of junior note classes, cash reserves, and excess spread.

SCFT 2019-A represents the first consumer loan term ABS (News - Alert) securitization in 2019 issued by the SpringCastle Joint Venture. The transaction is backed by loans acquired by SpringCastle JV comprised of Springleaf Acquisition Corporation ("SAC"), affiliates of New Residential Investment Corp. ("New Residential"), and an affiliate of Blackstone Tactical Opportunities Advisors LLC. ("Blackstone") from HSBC Finance Corporation ("HSBC") in April 2013.

OneMain Holdings, Inc. ("OMH" and its subsidiaries, "OneMain"), previously known as Springleaf Holdings, Inc. ("SHI"), sold its 47% interest in SpringCastle on March 31, 2016 to affiliates of New Residential and funds managed by Blackstone. OMH continues to service the SpringCastle portfolio via its subsidiary Springleaf Finance Corporation ("SFC") through its London, KY servicing center. SFC is a wholly owned subsidiary of Springleaf Finance, Inc. ("SFI" and together with SFC and its subsidiaries, "Springleaf" or the "Company"), which in turn is a wholly owned subsidiary of OMH. On November 15, 2015, SHI acquired OneMain Financial Holdings, LLC from CitiFinancial Credit Company, a wholly-owned subsidiary of Citigroup for $4.49 billion in cash. As a result, Springleaf Holdings, Inc. changed its name to OMH.

KBRA analyzed the transaction using the Global Consumer Loan ABS Rating Methodology. KBRA's consumer loan methodology incorporates an analysis of: (1) the underlying collateral pool, (2) the originator's historical static pool data, segmented by characteristics including credit quality and product type, (3) the proposed capital structure for the transaction, (4) KBRA's operational assessment of the originator and servicer and (5) the legal structure, transaction documents, and legal opinions.





 

Preliminary Ratings Assigned: SpringCastle Funding Asset-Backed Notes 2019-A

Class   Preliminary Rating   Initial Class Principal
A   AAA (sf)   $849,548,000
B   AAA (sf)   $70,405,000
C   AA (sf)   $18,775,000
   

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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