Barclays’ 13th U.S. credit card securitization, and the first for 2016, has taken a shift toward older vintage accounts in its new $609.8 million pool of receivables.
Barclays Dryrock Issuance Trust Series 2016-1 is features a $500 million Class A tranche that with preliminary ‘AAA’ structured finance ratings from both Standard & Poor’s and Fitch Ratings. It is supported by a $109.76 million Class B series of notes that will be retained for 18% credit enhancement.
The notes are backed by receivables from Barclays’ $7.73 billion pool generated by 3.61 million accounts for mostly co-branded cards issued by Barclays.
Compared to Barclays’ previous 2015-4 trust issuance from last October, the new transaction features a much higher weighted average account age of 72.2 months, up from 61.9 months, and a higher percent of receivables generated from accounts older than 60 months (57.39% vs. 51.85% in 2015-4)
In addition, no accounts that had been opened in the prior 12 months. Last October’s issuance included more than 4% of its $304.8 million receivables pools from accounts open for less than one year.
Otherwise, many of the 2016-1 characteristics follow Barclays’ other recent transactions, with principal balances of $2,117, credit limits averaging $10,240, and utilization rates above 20%. Barclays Dryrock also continues to include the strongest, prime borrower profiles in the receivables pool, with 55.25% of accounts from obligors with FICO scores higher than 720. Nearly 38% were from borrowers with FICOs above 750.
Nearly all the cards tied to the pool were issued in co-branding relationships with 18 partner companies. Over 40% of the receivables are derived from two issuers: LL Bean (728,099 accounts with $1.16 billion in receivables) and Apple (787,422 accounts, $1.08 billion in receivables).
Collateral performance remains strong and in line with prior asset-backed transactions with three-month average loss rates at 2.75-3%, average yields of 19.58% and three-month total payment rates above 25%.
The transaction is expected to close Aug. 3. Upon issuance, Barclays will have nine outstanding series through its Dryrock platform, according to Fitch. Barclays has more than doubled its receivables portfolio from $3.71 billion at year-end 2013.
