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

The trust priced $256.4 million of class A-1 notes, rated ‘F1’/ 'A1+' Fitch Ratings and Standard & Poor's at a yield of .19%. The short dated notes with  aweigheted average life of .32-year notes were sold to money market fund investors.

Also offered are three tranches, totaling  $743.6 million that have been assigned a preliminary ‘AAA’/'AAA' ratings. All of the tranches priced several basis points tighter than Carmax Auto Owners Trust 2014-3, the latest prime auto loan securitization to come to market.

The one-year, class A-2 notes issued from the Honda trust priced at 16 basis points over the Eurodollar synthetic forward, four basis points tighter than Carmax’s deal, which priced last week.

The two-year class A-3 notes priced at 19 basis points over interpolated swaps curve, 6 basis points tighter than the Carmax deal. The three-year, class A-4 notes priced at 18 basis points over interpolated swaps curve, 12 basis points inside the Carmax A4 notes.

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.

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.

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