Honda Motor Co. plans to offer a little over $1 billion in securities backed by new and used Honda and Acura automobile, light truck and utility vehicle loans, according to a deal document.

American Honda Finance, the issuer's captive finance company, originated and serviced the loans. RBS, Barclays and Wells Fargo are the lead underwriters on the deal, called Honda Auto Receivables 2014-3 Owner Trust.

The trust will offer $256.4 million of class A-1 notes that Fitch Ratings and Standard & Poor's expect to rate ‘F1’/ 'A1+'. The one-year notes are being marketed to money market fund investors.

Also on offer are three tranches, totaling  $743.6 million that have been assigned a preliminary ‘AAA’/'AAA' ratings. The class A-2 notes are due December 2016, the class A-3 notes are due June 2018 and the class A-4 notes are due October 2020. The deal is structured with $25.6 million of unrated subordinate notes.

This is the third securitization to be issued by Honda in 2014. The pool has a similar weighted average FICO score and similar seasoning to recent transactions, according to the presale report. New vehicles account for 90% of the collateral and the weighted average (WA) seasoning is 13.1 months.

The WA APR of the 2014-3 deal is 2.20%, consistent with 2.20% and 2.23% in 2014-2 and 2014-1, respectively. The shift in APR in more recent pools relative to older pools is due to the consistent increase in loans with subvented or subsidized interest rates. Loans with APRs of 0.00%−3.00% totaled 81.2%, up from 79.7% in 2014-2 and 80.3% seen in 2014-1.

Honda priced Honda Auto Receivables 2014-2 Owner Trust in May. The class A-2, senior notes with a weighted average life of 1.02-years priced at 14 basis points over the eurodollar synthetic forward curve. Both the class A-3 notes with a weighted average life of 2.11-years and the class A-4 notes with a weighted average life of 3.07-years priced at 21 basis points over the interpolated swaps curve.  

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