KBRA Gives Preliminary Ratings to Lendbuzz Securitization Trust 2022-1

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NEW YORK–(BUSINESS WIRE)–KBRA assigns preliminary ratings to two classes of bonds issued by Lendbuzz Securitization Trust 2022-1 (“LBZZ 2022-1”), an auto loan ABS transaction.

LBZZ 2022-1 is the second ABS securitization of Lendbuzz Funding LLC (“Lendbuzz” or the “Company”). LBZZ 2022-1 will issue two classes of notes totaling $198.064 million secured by a pool of automotive retail contracts with debtors and secured by new and used automobiles, light trucks and vans. The credit enhancement on the Notes includes overcollateralization, senior note class subordination, cash reserve account and excess spread.

Lendbuzz is an auto finance company established in 2015, headquartered in Boston, MA, with a research division based in Tel Aviv, Israel. The company’s founders started the business after emigrating to the United States for higher education and finding that they could not access basic credit products due to a lack of credit history. By using alternative data and machine learning algorithms to assess credit risk, Lendbuzz serves a target customer base that is typically unable to obtain financing from traditional lending sources such as credit unions, banks and captive auto finance companies, despite having sufficient verifiable income to support auto loan payments.

KBRA applied its global ABS rating methodology for auto loans, as well as its global structured financial counterparty methodology and its global ESG rating methodology as part of its analysis of the transaction’s underlying collateral pool, the structure of the proposed capital and historical data from Lendbuzz’s static pool. KBRA reviewed its operational review of the company, as well as periodic update calls with Lendbuzz. Operational agreements and legal opinions will be reviewed prior to closing.

Click here to see the report. To access relevant notes and documents, click here.

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Disclosures

Further information on key credit considerations, sensitivity analyzes which look at factors that may affect these credit ratings and how they could lead to an upgrade or downgrade, and ESG factors (where they are a driver key to the change in credit rating or rating outlook) can be found in the full rating report referenced above.

A description of all substantially significant sources that were used to prepare the credit rating and information on the methodology(ies) (including all significant models and sensitivity analyzes of the main relevant rating assumptions, the where applicable) used to determine credit rating are available in the information disclosure form(s) located here.

Information on the meaning of each rating category can be found here.

Additional information relating to this rating metric is available in the information disclosure form(s) referenced above. Additional information regarding KBRA’s policies, methodologies, grading scales and disclosures is available at www.kbra.com.

About KBRA

Kroll Bond Rating Agency, LLC (KBRA) is a full-service credit rating agency registered with the United States Securities and Exchange Commission as an NRSRO. Kroll Bond Rating Agency Europe Limited is registered as a rating agency with the European Securities and Markets Authority. Kroll Bond Rating Agency UK Limited is registered as a rating agency with the UK Financial Conduct Authority under the temporary registration scheme. In addition, KBRA is designated as the Designated Rating Agency 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.

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