Italian car giant Fiat is about to launch a securitization of performing autoloans. Called First Italian Auto Transaction, the E1 billion ($960 million) deal will be the biggest autoloan securitization yet to come out of Europe and the first such deal from Italy for ten years. The deal is expected in the market by the end of this month or the beginning of July.
Fiat has mandated Dublin-based Euro Capital Structures - a structured finance spin-off established by Fiat and UniCredito Italiano in May last year (ASRI 5/31/1999, p.1) - to arrange the deal. Merrill Lynch, Schroder Salomon Smith Barney and Unicredito have been brought in to underwrite the deal.
The deal will be backed by payments on 355,676 loans made by customers to SAVA, a wholly owned Fiat subsidiary that arranges lease funding for cars.
Credit enhancement of 11% for the E965.26 million class-A floating rate notes is provided by subordination of the E119.3 million M tranche. The senior tranche is expected to be given triple-A ratings from all three international agencies, while the retained M notes will not be rated.
The transaction is not Fiat's first venture into the securitization market. In 1998, the company issued the first CMBS deal to come out of Italy (ASRI 12/14/1998, p.1).