General Electric Capital Corp. plans to issue $718.95 million of securities backed by commercial finance leases from its GE Equipment Small Ticket trust. Series 2014-1, according to a Fitch Ratings presale report.
The commercial finance leases backing the series 2014-1 notes are primarily for office imaging (OI) equipment originated GECC. Within the pool, originations related to a particular original equipment manufacturer (OEM) represent 30.1%. This is the third transaction to include the OEM portfolio.
“Although relatively new to GECC's securitization platform, the OEM collateral characteristics are comparable to the OI collateral,” the presale report stated. “OEM originations, underwriting and servicing/collections processes are based on GECC guidelines and comparable to those established for the OI portfolio.”
Fitch expects to assign an 'AAA' rating to the class A notes, an AA’ rating to the class B notes, and an A’ rating to the class C notes. Credit enhancement for the notes has increased when compared with the issuer’s previous transaction, the 2013-1 notes. Credit enhancement for the class A notes increased to 14.80% from 13.66% in 2013-1; for class B and C notes is 12.70% and 8.81%, respectively, up from 11.49% and 7.66% in 2013-1.
This is the issuer’s ninth small ticket equipment term asset-backed transaction and its first 2014 deal. RBS Capital Markets is lead underwriter.