Ford Motor Credit, Ally Bank and Toyota Motor Credit are marketing over $3 billion of securities backed by prime auto loans, according to rating agency reports.

The $1.25 billion Toyota Auto Receivables 2016-A Owner Trust will issue $351 million of money market notes and three tranches of term securities with preliminary ‘AAA’ ratings from Standard & Poor’s: $359 million of notes with a legal final maturity of July 2018; $401 million of notes maturing in March 2020; and $107.75 maturing in September 2021. There is also a $31.25 million subordinate tranche rated ‘AA+’ that matures in March 2022.

Bank of America Merrill Lynch is the lead structuring agent.

According to S&P, the credit quality of the transaction's collateral is similar to Toyota’s previous deal, completed in August 2015. The obligors' weighted average FICO score is 757, and approximately 80% of the obligors by balance have FICO scores greater than 700. While 29.4% of the pool's loans by principal balance have original terms of 61-72 months, only 13.8% have remaining terms of that duration, due to seasoning. The collateral pool includes no loans with original maturity terms greater than 72 months or borrowers with FICO scores below 620.

S&P’s expected cumulative net losses for the 2016-A pool is between 0.50%-0.60%, unchanged from the sponsor’s 2015 and 2014 deals.

Despite the strength of the collateral, the deal’s credit enhancement has increased slightly, to account for the increased number of loans that pay little or no interest for the first few years. Accordingly, the required yield supplement overcollateralization rate increased to 5.25% from 5.00% for the previous deal.

The $1 billion Ally Auto Receivables Trust 2016-2 will issue $257 million money market tranche and three tranches of notes with preliminary triple-A ratings from S&P; the rating agency’s presale report did not list their respective tenors.

Barclays Capital is the lead underwriter.

The credit quality of the collateral is little changed from Ally’s previous deal , with a weighted average seasoning of 11.97 months, loan-value-ratio of 94.65%, and FICO score of 740.

However the percentage of longer term loans, those with original terms of 61-75 months, increased to 68.0% from 63.9%. Longer term loans are generally considered to be riskier because they amortize more slowly, leaving the borrower owing more than the depreciated value of the vehicle for longer. 

And the $810.8 million Ford Credit Auto Owner Trust 2016-REV1 will issue $750 million of notes with preliminary triple-A ratings from Standard & Poor’s and TKT; $30.4 million of notes rated double-A and $30.4 million rated single-A. All of the notes pay a fixed rate of interest and have a legal final maturity of August 2027.

The notes are secured by a revolving pool of contracts. For five years, the trust can use cash flows to acquire additional collateral. To limit deterioration in pool quality and credit enhancement while the pool revolves, the transaction includes pool composition tests, a credit enhancement test, early amortization triggers, and a net losses test.

The trust may also sell receivables to the depositor, another Ford Credit SPE, or a third-party purchaser on any payment date during the revolving period

Bank of America Merrill Lynch is the lead underwriter.

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