Hyundai Capital America’s latest $1.12 billion securitization represents the largest auto-lease asset-backed transaction offering to date sponsored by the captive finance arm for dealerships of Hyundai, Kia and Genesis brand vehicles in the U.S.
Hyundai Auto Lease Securitization Trust (HALST) 2021-A, which involves a pool of 61,719 prime auto-lease receivables contracts, is secured by monthly receivables as well as the residual value of vehicles at contract maturity. The aggregate securitized vehicle value is $1.27 billion, according to presale reports from S&P Global Ratings and Moody’s Investors Service.
The notes offering is the largest among the 21 auto-lease deals HCA has issued since 2011, and the fourth that topped $1 billion. HCA’s previous transaction priced last September was among those $1 billion-plus bond sales.
The capital stack for the HALST 2021-A — which is the first auto-lease ABS deal in the new year — includes Class A term note tranches with preliminary triple-A ratings from S&P and Moody’s. Both the Class A-2 tranche due April 2023 and the Class A-3 tranche due January 2024 each total $415 million. A Class A-4 tranche due December 2024 is $88.77 million, and a double-A rated subordinate Class B tranche is $69.79 million.
HCA will also market a $128.1 million one-year, Class A-1 money-market tranche.
The presale reports note that the base end-of-lease residual value vehicles, as a percentage of securitization value, increased to 66.69% from 65.55%. HCA slightly boosted the proportion of contracts with 43-48 month original terms increased to 20.27% from the previous HSALT deal.
The share of 37-42 month leases decreased to 7.28% from 8.12%. The large majority of contracts are 36-month leases, making up 71.53% of the deal’s securitized value. .
The lease contracts have an average seasoning of 10.81 months and have staggered maturities over the next three years: 41.09% will mature in 2022; 45.93% in 2023; and 12.97% in 2024. The earliest maturities will be February 2022.
The auto-lease pool for HALST 2021-A has a weighted average borrower FICO of 761.
SG Americas Securities is lead underwriter.
