Dealer floorplan loan contracts will secure $1.3 billion in asset-backed securities (ABS), between two issuances from the Ford Credit Floorplan Master Owner Trust,
Series 2024-1 and 2024-2 will issue $986.8 million and $394.7 million in notes, respectively, according to ratings analysts at Moody's Investors Service. The rating agency noted a diverse pool of 3,160 designated accounts including dealers, agreements between franchise dealers and vehicle manufacturers as one of the deal's key credit drivers. Other positive characteristics, on both, include that Ford Credit is an experienced sponsor and servicer.
Yet both pools have exposures to large dealers, meaning losses could be more pronounced if one dealer goes bankrupt, Moody's said. Another is that both series have revolving periods, when noteholders will not receive any principal. For the series 2024-1 and the 2024-2, those periods are 35 months and 59 months, respectively. After that, series 2024-1's amortization period begins on April 15, 2027 and on series 2024-2 it begins two years later on the same date.
Barclays Capital, Credit Agricole Securities, Mizuho Securities, Citigroup Global Markets and J.P. Morgan Securities are all lead underwriters on both deals.
FCFMOTA 2024-1, which has 3,160 accounts, will issue five tranches of A, B, C and D notes, according to Moody's. All of the notes in that series have a legal final maturity date of April 15, 2029 and a reserve account representing 0.44% of the pool balance. Class A notes benefit from 24.44% of initial hard credit enhancement, while classes B. C and D are covered with 19.9%, 15.9% and 12.9% in credit enhancement, respectively.
Moody's intends to assign ratings of Aaa to the A notes; Aa1 to the class B notes; Aa3 to the class C notes; and A1 to the class D notes on the 2024-1 series. Those ratings are the same on the 2024-2 series, except the capital structure doesn't have an A2 tranche.
Series 2024-2 also has 3,160 accounts in the pool, with an average loan balance of $6 million, and on a weighed average (WA) basis the loans have a rate of 1.20% over prime.
Aside from the reserve fund and subordination, the notes benefit from excess spread.
