Consumer Portfolio Services (CPS) is in the market with a $109.9 million auto deal called CPS Auto Receivables Trust 2011-B (CPSART 2011-B).
The CPSART 2011-B transaction is CPS' third securitization since September 2010, when it issued series 2010-A. According to a presale from Standard & Poor's, the CPSART 2011-B ABS is structured as a true sale of the receivables from CPS to CPS Receivables Five LLC, which is a multi-use, special-purpose Delaware limited liability firm as well as a wholly owned, limited-purpose unit of CPS.
Some of the significant changes that S&P mentioned compared to SPSTART 2011-A is that its expected net loss range dropped to 14.25%-14.75% from 15.00%-17.00% becuase of the lower projected losses on CPS' 2009 and 2010 originations versus 2007-2008 originations, improved pool mix, and better portfolio performance. The rating agency said that the percentage of loans in the higher-credit-tier programs rose to 77% from 75%. It also said that the percentage of loans in CPS' top two credit tier programs went up to 21% from 17%.
Aside from CPS, Nissan Motor Acceptance Corp., Toyota Motor Credit and Volkswagen came to market with auto deals this week.
In S&P report, analysts said that auto loan securitizations have been significantly contributing to U.S. ABS issuance totals, with the activity picking up this month.
Analysts from the firm said that auto ABS, which comprises leases and dealer floorplan ABS as well, public issuance is $45 billion year-to-date through Sep. 1. This is compared to $58 billion for all of 2010, S&P said citing figures from Securities Industry and Financial Markets Association (SIFMA).
Auto ABS outstanding reached $197 billion in 2005, and has since dropped to $112 billion, correlated with the fall in auto sales during the same period.
Analysts expect full-year 2011 auto sales to be about 9% over last year's figures. This would cause auto ABS issuance to probably show a similar rise, reaching $64 billion in 2011, S&P analysts said.