Ally Bank is marketing $1 billion of prime auto loan securities in its first deal of 2016.
Citigroup, Credit Agricole and Deutsche Bank are the lead managers. Moody's Investors Service assigned preliminary ratings to the notes.
The deal—called Ally Auto Receivables Trust 2016-1—offers four tranches of ‘Aaa’ rated notes. The class A-2a and A-2b notes mature on Aug. 15, 2018; the class A-3 notes mature on April 15, 2020 and the class A-4 notes mature on November 16, 2020. The class A note benefit from 5.85% credit enhancement.
At the subordinate level, the trust will offer $22 million of ‘A1’ rated class B notes; $18.4 million of ‘Baa1’ rated class C notes and $13.7 million of ‘Ba1’ rated class D notes.
The collatral pool is compromised of a large proportion ( 64%) of longer term loans, keeping in line with previous AART deals issued since 2013; 10% of loan balances in the pool were originated with original term greater than 72 months. “Longer term loans in the prime segment generally have weaker performance compared to loans with original terms of 60 months and less,” stated Moody’s in the presale report.
The loans have a weighted average FICO of 741 and a WA LTV of 94%. On average the loans are seasoned by 12 months and have WA remaining term of 54 months.