AmeriCredit Corp. said it closed a $290 million residual financing facility, which will act as credit enhancement in future senior/subordinate securitizations. Deutsche Bank Securities is the lead banker, with Barclays Capital, JPMorgan Securities, Wachovia Securities and Credit Suisse First Boston participating in the deal.
Via the facility, AmeriCredit is locking in subordinate/residual investment in its future deals, allowing the firm to manage its funding risk. Essentially, AmeriCredit could bring a senior/subordinate ABS without having to place the sub bonds in the market. Typically, the B-piece, which is rated single-B or double-B, is the most difficult tranche to place, especially for a subprime lender in the current risk adverse investor environment.