The Verizon Master Trust is preparing to issue two series of asset-backed securities (ABS) notes totaling $749.8 million, secured by interests in a pool of wireless device payment plans.
The 2025-1 series, which will sell $449.9 million in notes has a Jan. 21, 2031 legal final maturity date. The 2025-2 notes, meanwhile, will sell $249.9 million in notes that will mature two years later, the rating agencies said. Both deals are expected to close on Jan. 22, 2025.
Also in both series the class A, B and C notes benefit from 19.2%, 13.0% and 9.2% in total hard credit enhancement, respectively, the rating agencies said.
Fitch Rating says it noticed a greater preference for consumers to use cellphones for a longer period and previously decreased the assumptions for upgrade losses to 0.25%, from 0.35%. That loss assumption remains at the same, lowered level for the current transaction, the company said. In the 2025-2 and 2025-2 deals, 64.9% of customers had wireless plans with tenures of 60 months or more, the rating agency said.
There are about 23.6 million accounts among the 2025-1 and 2025-2 collateral pools, Fitch said, and on a weighted average (WA) basis they have about 24 months in remaining installments. Also, on a WA basis the underlying customers have a FICO score of 725. Most receivables, 57.5%, represent obligors with upgrade eligibility, the rating agency said.
A vast majority of the receivables are from retail customers, leaving 9.9% to business receivables.
The pool is geographically diverse, with California, Florida and Texas accounting for 9.9%, 6.2% and 6.0% of the pool, respectively.
Fitch assigns AAA to the A1/A notes; AA to the class B notes; and A to the class C notes on the 2025-1 and 2025-2 transactions.
For the 2025-1 and 2025-2 notes, S&P assigns AAA to the class A notes; AA- to the class B notes; and A- to the class C notes. The ratings remained the same on the 2025-2 notes.
