Ally Financial, priced its auto loan securitization deal, Capital Auto Receivables Asset Trust 2013-1 after announcing that it had upsized its deal to $1.56 billion from $940 million.
The deal tests both appetite for Ally’s first public transaction with a collateral pool consisting predominantly of non-prime loans and a novel revolving structure where proceeds from loan payments during the first 12 months of the transaction may be directed to the purchase of new loans to add to the collateral pool.
Moody's Investors Service assigned preliminary ratings to the transaction. The updated capital structure includes a total of $1.315 billion of class A notes, rated 'Aaa'. The $333 million class A-1 notes, were offered with a 1.25 year weighted average life and priced at 15 basis points over the eurodollar spot forward benchmark.
The $523 million class-A-2 notes with an average life maturity of 1.93 years, priced at 26 basis points. The $333 million class A-3 notes, with an average life maturity of 2.77 years priced at 34 basis points over interest rate swaps. The $126.9 million class A-4 notes, with an average life maturity of 3.35 years, priced at 43 basis points.
The $69.9 million of class B notes, rated 'Aa1' with a weighted average life maturity of 3.65 years priced at 70 basis points. The $102.8 of class C notes, rated 'A1' with a weighted average life maturity of 3.97 years priced at 110 basis points. The $78.14 of class D notes, rated 'Baa2' with a weighted average life maturity of 4.24 years priced at 150 basis points. BofA Merrill Lynch, Barclays Capital and Citigroup are lead underwriters on the deal.
Gerald Keefe, Americas head of securitized products at Citi said there were 45 unique investors in the book, representing broad and deep participation. “Ally did an extensive and successful roadshow prior to the formal announcement of this trade,” he told ASR in an e-mailed statement. “Investors spent time understanding the revolving structure, which is not typical for retail auto ABS comps. Ultimately they were comfortable with the revolving structure, as loans added to the deal during the revolving period are subject to strict collateral criteria to prevent migration of the pool.”
Amanda Magliaro, head of ABS syndicate at Citi noted that the collateral for the Ally deal is higher quality than subprime collateral. “The capital structure reflected rating agency stresses more like those applied to prime auto losses, making the structure attractive to investors,” said Magliaro.