Exeter Finance priced its upsized $650 million subprime auto loan securitization on Wednesday.

The deal,Exeter Automobile Receivables Trust 2014-1, which was originally sized at $500 million, offered four tranches that were rated by DBRS and Standard & Poor’s.

The class A notes were rated ‘AAA’/ ‘AA’ by DBRS and S&P, respectively, with a weighted average life of 1.05-years priced at 100 basis points over the Eurodollar synthetic forward curve.

The single-A rated class B notes with a weighted average life of 2.71-years priced at 170 basis points over the interpolated swaps curve.

The triple-B rated class C notes with a weighted average life of 3.38-years, priced at 260 basis points over the interpolated swaps curve.

Exeter sold a 4-year, double-B rated, class D tranche at 435 basis points over  the interpolated swaps curve.

Deutsche Bank and Goldman Sachs acted as joint bookrunners on the transaction, with Wells Fargo Securities and Citigroup participating as co-managers.

This is Exeter’s fifth subprime securitization.  According to the S&P presale report, the issuer has experienced rapid growth. As of Dec. 31, 2013, the managed portfolio increased by 2.30x to $1.94 billion, compared with a year ago.

“While rapid growth is not unusual for relatively new subprime auto finance companies, we are concerned that the company's growth may have come at the expense of credit quality,” noted analysts.

Exeter has responded to concerns by tightening its underwriting standards, which include using nontraditional credit bureau data to identify borrowers at a greater risk of default and declining those borrowers. The weighted average FICO for its latest deal increased to 568 from 561 in the 2013-2 deal.

The portion of loans originated to obligors with FICOs greater than 600 also increased in the deal to 24.28% from 19.18%.

The company said it has also started to enforce down payment requirements and discontinued business with their weakest-performing dealers.

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