Mariner Finance, the subsidiary of MF Raven Holdings, is preparing to sponsor a $300 million securitization of consumer loans through the Mariner Finance Issuance Trust 2023-A, amid lower originations and tightened underwriting criteria.
After the closing of a previous deal, the MFIT 2023-A, Mariner added one new warehouse facility in February 2023, and renewed three existing facilities, according to ratings analysts from Kroll Bond Rating Agency. As of June 30, 2023, the warehouse facilities had $92 million available out of an $863 million capacity across its various bank facilities.
MFIT 2023-A will issue notes through five classes of notes that draw its revenue from a pool of 75,670 loans, KBRA said. On average the loans have a balance of $4,539. On a weighted average (WA) basis the loans have an original term of 45 months, and remaining term of 39 months.
The Asset Securitization Report's deal database notes that the most recent MFIT deal has BMO Capital Markets, Citigroup Global Markets, Goldman Sachs and Wells Fargo Securities as managers on the deal.
S&P Global Ratings and KBRA will assign ratings to the notes, and they are pretty much identical, with 'AAA' assigned to the class A notes; 'AA-' to the class B notes; 'A-' to the class C notes; 'BBB-' to the class D notes and 'BB-' to the class E notes. They also note that MFIT 2023-A will repay investors through a senior-subordinate structure.
The notes have the same final scheduled repayment date of Oct. 22, 2035, an initial credit enhancement that ranges from 43.85% on the class A notes to 13.15% on the class E notes, according to KBRA.
A handful of credit enhancements support the notes, including initial overcollateralization 12.65%, a cash reserve account equaling 0.50% of the original pool balance, and excess spread of 14.36%.
The loan assets are fixed rate, as are the notes, and unsecured loans account for 20.13% of the pool, the highest in KBRA's available comparison.
On the corporate side, originations for the six months ended on June 30 amounted to $1.2 billion, down about 6.9% for the same period the prior year. Mariner was profitable for the six months ended June 30, but profitability had decreased, the rating agency observed.
