The timeshare sector is making a few waves in the securitization sector this month. Over the course of a week, three deals came to market, two of which priced at press time.
The Silverleaf Finance VI, a $149 million transaction from issuer Silverleaf Resorts, was still being marketed at press time.
Another transaction, the BXG Receivables Note Trust, 2008-A, came to market on April 28 and amounted to $57 million and was managed by BB&T Capital Markets.
One issuer, the Wyndham Worldwide Corp. decided to resume the practice of issuing deals with senior/subordinate structures. Back in 2003, the company began issuing its ABS notes through its Sierra Timeshare trust with monoline wraps.
At the time, it was practically the only issuer in this relatively small asset class to come to market with that type of credit enhancement.
Now that the financial guarantor sector has virtually receded from the securitization sector, Wyndham Worldwide's latest deal, the $200 million Sierra Timeshare 2008-1, is a return to the senior/subordinate structure. That deal priced on April 25, according to market sources. RBS Greenwich Capital and Credit Suisse acted as lead managers.
A private 144A transaction, the Sierra Timeshare includes several mechanisms to compensate for the lack of a guarantor's wrap, and the senior/subordinate structure represents one of the most distinctive changes to the program, according to ratings information on the deal. Class B and C notes were added to the deal, providing 15.75% and 11.5% of subordination for the Class A notes, respectively, said Fitch Ratings.
Also, the initial hard credit enhancement for the class A notes was increased to 50.5%, from the 11.25% level that bolstered the 2007-2 transaction. Also, the Class B and C notes benefit from initial credit enhancement of 39% and 23.5%, respectively.
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