Synchrony Bank, formerly GE Capital Retail Bank, has launched its first credit card securitization of the year, according to rating agency presale reports.
The $694 million Synchrony Credit Card Master Note Trust's series 2015-1 issuance is backed by a pool of private-label and co-branded revolving credit card receivables.
All of the notes to be issued have a weighted average life of five years.
Both Fitch Ratings and Standard & Poor’s have assigned a triple-A rating to the $500 million of class A notes, which benefit from credit enhancement of 28%.
There are also $48 million class B notes rated AA’ by Fitch and AA+’ by S&P; $41 million class C notes rated A’/’AA- and $69 million of class D notes rated BBB+’ by S&P. Fitch is not rating the class D notes, which are not publicly offered.
Synchrony is currently 85% indirectly owned by General Electric Capital Corp. (GECC) through GECC's ownership of Synchrony Financial, the direct parent of Synchrony Bank. GECC intends to spin off its remaining ownership in Synchrony in late 2015.
GE Capital Retail Bank changed its name to Synchrony Bank on June 2, 2014. The bank offers mostly private-label credit card accounts. The private-label credit card account business consists of revolving consumer credit account programs established with retailers that have been approved by the bank. The bank currently originates co-branded credit cards for Wal-Mart, Sam's Club, JCPenney and Gap, among otehrs.
With the issuance of series 2015-1, there will be 21 series outstanding in the master note trust. Principal receivables totaled approximately $16.25 billion as of Jan. 21, 2015, according to Fitch. The active accounts designated for the trust portfolio had an average account balance of $707 and an average credit limit of $3,398. The average utilization rate for all accounts was 20.8%.
As of the same period, the average seasoning of accounts in the trust was approximately 124 months. The trust is geographically diverse, with the top five states -Texas, California, Florida, North Carolina and New York - representing approximately 34.4% of the outstanding receivables pool.
Synchrony Bank was last in the market with credit card ABS in November, when it priced $924 million f three-year class a notes at swaps plus 45 basis points to yield 1.63%.
