Royal Bank of Canada (RBC) plans to issue credit card transactions under its Golden Credit Card Trust Series 2012-5 and 2012-6.
Moody's Investors Service and DBRS gave a preliminary rating of 'Aaa (sf)' and 'AAA (sf)', repsectively, to the 2012-5 offering's U.S.-dollar denominated, fixed-rate senior notes and 'Baa1 (sf)' and 'BBB (high) (sf)' to the transaction's Canadian-dollar denominated, fixed-rate subordinated notes.
Both Moody's and DBRS have assigned provisional ratings to the Series 2012-6 deal. Moody's assigned a 'Aaa (sf)' and DBRS 'AAA (sf)' to the U.S.-dollar denominated, senior floating-rate notes. Meanwhile, the agencies assigned 'Baa1 (sf)' and 'BBB (high) (sf)', respectively, to the Canadian-dollar denominated, fixed-rate subordinated notes.
According to a DBRS report on the 2012-6 transaction, a cross-currency, interest rate swap should be in place for the senior notes.
DBRS based its rating for the 2012-6 transaction on the credit enhancement for the senior notes, which comprises subordination of 4.5%, excess spread and the Series Reserve Account. This can build up to 5% of the initial invested amount. For the subordinated notes, credit enhancement will be via excess spread and the Series Reserve Account.
According to the rating agency, the trust's portfolio's performance has been strong since the beginning and has shown resilience throughout the recent economic downturn. In the last two years, three-month average payment rates have stayed at roughly 42%. The loss rates have stayed the lowest in Canada.
Additionally, analysts said the custodial pool is a well-diversified and seasoned portfolio of prime credit quality obligors that are originated and managed by RBC. The bank is the largest financial institution in Canada.
Othere deals this week include one on the auto side. Ford Motor Co. is planning to issue an $833 millon auto ABS called Ford Credit Auto Lease Trust (FCALT) 2012-B.
According to a Fitch Ratings presale on the deal, the notes are backed by an exchange note. This, in turn, will be backed by a referenced pool of closed-end leases on various brands of new vehicles that are mostly manufactured by Ford.
The leases were originated by Ford dealers and bought by one or more Ford Motor Credit Co.-created titling companies directly from franchised dealers, the rating agency said.
Fitch said that the credit quality for the pool is consistent with that of the firm's recent pools. The weighted average FICO score for the deal is 745 and the term is 33.40 months with 26.15% of the leases having terms of over 36 months. The pool features geographic diversity with roughly nine months ofseasoning, comprising 100% new vehicles.