Ally Bank’s next prime auto loan securitization offers a $1 billion helping of securities backed by weaker credit loans on new and used auto loans.

The issuer continued on with the trend of increasing longer dated loans in the pool with higher loan-to-values and lower FICOs, similar to the credit profile of the 2014-2 pool.

Ally Auto Receivables Trust 2014-3 has a lower weighted average FICO of 741, according to the Fitch Ratings presale. Longer dated loans, those with original terms greater than 60 months, represent 67% of the portfolio, the share of used car loans is at 30% and the weighted average loan to value ratio is at 97.37%.

The weaker credit is similar to the issuer’s last deal issued in September had a weighted average FICO of 749 and a loan to value ratio of 97.7%

However, Fitch noted in the presale that despite the weakening credit characteristics, the loans that Ally securitizes continue to perform well. Ally’s 2009−2014 portfolio and securitization delinquencies and losses remain at very low levels historically through third-quarter 2014.

On offer is a $215 million money market tranche with credit enhancement at 5.85% that is due Dec. 15, 2015.  Three tranches of class A notes, totaling $742.8 million will also be sold. The notes are rated ‘AAA’ and have credit enhancement at 5.85%. The class A2 notes are due Sept., 15, 2017, the class A-3 notes are due June 17, 2018 and the class A4 notes are due March 16, 2020.

Also on offer are $21.3 million of ‘AA’ rated class B notes due March 2020; $17.5 million of ‘A’ rated class C notes due July 2020 and $16.4 million of ‘BBB’ rated class D notes due August 2021.

Bank of America Merrill Lynch is the lead underwriter on the transaction.

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