Georgia-based subprime auto finance company Global Lending Servicers has is pooling a new batch of new- and used-car loans with slightly better credit metrics than its first three securitizations of the year.
The $310.47 million GLS Auto Receivables Issuer Trust 2020-4 collateralizes 13,316 loans with an average borrower FICO of 573. That is lower subprime territory, but is slightly higher than any of GLS’ most recent securitizations, according to a report from DBRS Morningstar.
That helped GLS provide a lower credit enhancement (54.2%) compared to its prior transaction that closed in July, and achieve a lower cumulative net loss assumption (21.5%) from DBRS Morningstar.
The loans have a weighted average balance of 18,514 on original terms of 69 months, with three months of seasoning. The WA loan-to-value ratio is 118.25%.
The capital stack includes $155.4 million in Class A notes due February 2024 with preliminary AAA ratings from DBRS Morningstar.
The deal is the 14thoverall 144A securitization for GLS, which launched in 2011 and has grown to $1.66 billion in originations in 2019. The company originates subprime auto loans in 47 states, and had a managed portfolio totaling $2.74 billion as of Sept. 30.
The company is majority-owned by BlueMountain Capital Management.
Since September, ratings on two of GLS’ outstanding securitizations from 2020 and 2019 were affirmed after being placed on downgrade watch by Kroll Bond Rating Agency and S&P Global Ratings.
