A pool of credit card receivables from accounts that WebBank owns and extended to non-prime or near-prime obligors will secure $300 million in asset-backed securities (ABS).
The deal, Avant Credit Card Master Trust, AVCCT 2026-1, will sell notes through six tranches of notes, from classes A through F, which all have a legal final maturity date of March 15, 2032, according to Kroll Bond Rating Agency.
Compared with the previous deal, Avant Credit Card Master Trust, the 2025-1, the current deal's assets have a higher principal receivables balance of $930, compared with $833 on the AVCCT 2025-1. On a weighted average (WA) basis, there is a lower collateral interest rate and a lower non-zero FICO score, of 630 versus 632, KBRA said.
The AAA rated, class A bonds have initial credit enhancement levels of 38.86%, KBRA said. After that level, classes B, C, and D benefit from levels of 31.36%, 23.31%, and 15.00%, respectively. Classes E and F benefited from initial credit enhancement levels of 9.00% and 3.00%, respectively, KBRA said.
Structured as a master trust deal, AVCCT 2026-1 includes a three-year revolving period, when no principal payments will be made on the series 2026-1—unless an early amortization event happens and starts that payment process, the rating agency said.
KBRA did note—although not in an upfront positive way—that the deal will not include any concentration limits on receivables that it will accumulate during the revolving period, KBRA said.
Yet there are some characteristics that will mitigate this risk, such as an amortization trigger based on excess spread, which will increase the deal's reserve requirement and end the revolving period, based on a deterioration of collateral performance, KBRA said.
Total gross excess spread amounts to 23.09%, an initial overcollateralization level of 3.00%, which is also the target for the deal.
As of June 30, Avant had originated 3.2 million credit card accounts. The company's credit card customers paid annual feed up to $125 and had interest rates that range from 25.99% to 35.99%, KBRA said.
KBRA assigned ratings of AAA, AA- and A- to classes A, B and C, respectively; and BBB-, BB and B+ to classes D, E and F, respectively.
