NEW YORK–(BUSINESS WIRE)–#creditratingagency–KBRA assigns preliminary ratings to six classes of notes issued by First Investors Auto Owner Trust 2025-1 (“FIAOT 2025-1”), an asset-backed securitization collateralized by a pool of auto loans. FIAOT 2025-1 represents the first term ABS securitization in 2025 for Stellantis Financial Services, Inc. d/b/a First Investors Financial Services (“SFS” or the “Company”) and the fourth since the Company’s acquisition by Stellantis N.V. in 2021.
FIAOT 2025-1 will issue six classes of notes totaling $350.0 million. The ratings reflect initial credit enhancement of 41.75% for the Class A-1, Class A-2, and Class A-3 notes, through 14.25% for the Class D notes. Credit enhancement consists of subordination (except for the Class D notes), overcollateralization, a reserve account and excess spread.
SFS purchases fixed rate automobile retail installment contracts, which are secured by new and used non-commercial automobiles. Historically, the Company purchased subprime automobile RICs from certain non-Stellantis franchise dealerships via its indirect lending program (the “Legacy Indirect Program”), and refinanced existing subprime and near-prime auto loans through its direct program (the “Legacy Direct Program” together, the “legacy programs”). In October 2022, SFS began acting as an indirect finance subsidiary of Stellantis to purchase near-prime and prime RICs and leases from approximately 2,600 Chrysler, Jeep, RAM, Alfa Romeo and Fiat franchise dealerships across the United States (the “Captive Program”).
KBRA applied its Auto Loan ABS Global Methodology as well as its Global Structured Finance Counterparty Methodology and ESG Global Rating Methodology as part of its analysis of the portfolio pool data, underlying collateral pool, and capital structure. KBRA considered its operational reviews of SFS, as well as periodic due diligence calls with the Company. Operative agreements and legal opinions will be reviewed prior to closing.
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Methodologies
- ABS: Auto Loan ABS Global Rating Methodology
- Structured Finance: Global Structured Finance Counterparty Methodology
- ESG Global Rating Methodology
Disclosures
Further information on key credit considerations, sensitivity analyses that consider what factors can affect these credit ratings and how they could lead to an upgrade or a downgrade, and ESG factors (where they are a key driver behind the change to the credit rating or rating outlook) can be found in the full rating report referenced above.
A description of all substantially material sources that were used to prepare the credit rating and information on the methodology(ies) (inclusive of any material models and sensitivity analyses of the relevant key rating assumptions, as applicable) used in determining the credit rating is available in the Information Disclosure Form(s) located here.
Information on the meaning of each rating category can be located here.
Further disclosures relating to this rating action are available in the Information Disclosure Form(s) referenced above. Additional information regarding KBRA policies, methodologies, rating scales and disclosures are available at www.kbra.com.
About KBRA
Kroll Bond Rating Agency, LLC (KBRA), one of the major credit rating agencies (CRA), is a full-service CRA registered with the U.S. Securities and Exchange Commission as an NRSRO. Kroll Bond Rating Agency Europe Limited is registered as a CRA with the European Securities and Markets Authority. Kroll Bond Rating Agency UK Limited is registered as a CRA with the UK Financial Conduct Authority. In addition, KBRA is designated as a Designated Rating Organization (DRO) by the Ontario Securities Commission for issuers of asset-backed securities to file a short form prospectus or shelf prospectus. KBRA is also recognized as a Qualified Rating Agency by Taiwan’s Financial Supervisory Commission and is recognized by the National Association of Insurance Commissioners as a Credit Rating Provider (CRP) in the U.S.
Doc ID: 1011996
Contacts
Analytical Contacts
Michael Polvere, Director (Lead Analyst)
+1 646-731-3339
[email protected]
Hyren Jain, Analyst
+1 646-731-1327
[email protected]
Melvin Zhou, Managing Director (Rating Committee Chair)
+1 646-731-2412
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Business Development Contact
Arielle Smelkinson, Senior Director
+1 646-731-2369
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