As its parent's corporate debt rating teeters on the brink of junk status, General Motors Acceptance Corp. will tap the ABS market with a $1.5 billion auto lease offering, marking GMAC's first foray into the auto lease sector. The deal is structured with a novel three-tiered, true-sale process which buffers it from the dual headline risk of GMAC's declining credit quality and the potential of a Pension Benefit Guaranty Corp. asset seizure in the event of a bankruptcy.

One of the deal's most unique factors is its legal structure, which insulates it from risk associated with liability to the PBGC. In a worst-case scenario, the PBGC could attach liens to the lease assets to satisfy GMAC's pension obligations in the event of a bankruptcy. Two years ago, Standard & Poor's caused a stir in the sector by placing 32 classes of auto lease ABS on watch for a downgrade due to this risk.

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