Kroll Bond Rating Agency Assigns Preliminary Ratings to United Auto Credit Securitization Trust 2012-1

NEW YORK--(BUSINESS WIRE)--Kroll Bond Rating Agency (“KBRA”) announces the preliminary ratings to four classes of United Auto Credit Securitization Trust 2012-1 (“UACST 2012-1”), a subprime auto asset-backed securities transaction.

UACST 2012-1 is collateralized by approximately $195 million of subprime auto loan receivables. The preliminary ratings reflect the initial credit enhancement levels ranging from 35.60% for the Class A notes to 7.65% for the Class D notes, which build to 41.45% and 13.50% for the Class A and Class D notes, respectively. The transaction also includes a quarterly cumulative new loss trigger which, if breached, would increase the targeted credit enhancement to 47.70% for the Class A notes and 19.75% for the Class D notes.

United Auto Credit Corporation (“UACC”) is an experienced originator and servicer of subprime auto loans. UACC has originated and serviced subprime auto loans for over 16 years. UACC underwent a restructuring and change in management in 2008. During 2008, the company hired an experienced management team and over the past 4 years has transitioned from a decentralized retail branch network of 144 locations, to a centralized operating structure with a dedicated servicing and collection center.

KBRA applied its U.S. Auto Loan ABS methodology as part of its analysis of the transaction’s underlying collateral pool, the proposed capital structure and UACC’s historical static pool data. KBRA also conducted an operational assessment of UACC, 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.

For complete details on the analysis, please see KBRA’s Pre-Sale Report, “United Auto Credit Securitization Trust 2012-1”, which was published today at www.krollbondratings.com.

Preliminary Ratings Assigned: United Auto Credit Securitization Trust 2012-1

Class	Rating	Expected Initial Class Principal
A-1	K1+(sf)	$61,400,000
A-2	AAA(sf)	$68,100,000
B	AA(sf)	$16,000,000
C	A(sf)	$21,200,000
D	BBB(sf)	$17,300,000

17g-7 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: United Auto Credit Securitization Trust 2012-1 17g-7 Disclosure report.

Related Publications:

U.S. Auto Loan ABS Rating Methodology

About Kroll Bond Rating Agency

KBRA was established in 2010 by Jules Kroll to restore trust in credit ratings by creating new standards for assessing risk and by offering accurate, clear and transparent ratings. KBRA is registered with the U.S. Securities and Exchange Commission as a Nationally Recognized Statistical Rating Organization (“NRSRO”). In addition, KBRA is recognized by the National Association of Insurance Commissioners (“NAIC”) as a Credit Rating Provider (“CRP”).