Volkswagen is marketing a $1 billion securitization of auto leases, according to a presale report published by Fitch Ratings.

Fitch has assigned a preliminary ratings to four classes of notes to be issued by Volkswagen Auto Lease Trust 2015-A: an ‘F1’ rating to a $166 million money market tranche and ‘AAA’ to a $464 million tranche with a final maturity of June 2017, a $295 million tranche with a final maturity of December 2017 and a $75 million tranche of notes with a final maturity of July 2019. All four classes benefit from credit enhancement of 15.75%.

The notes will be backed by a pool of $1.18 billion of closed-end vehicle leases, all of which are secured by new Volkswagen and Audi brand vehicles manufactured by Volkswagen and originated through Volkswagen Credit, which will also act as the servicer.

Barclays is the lead underwriter.

According to Fitch, the pool is consistent with that of Volkswagen’s prior auto lease securitization, 2014-A, with a strong weighted average FICO score of 759, 11 months of seasoning and undiscounted residual value representing 67.10% of the securitization value.

The initial credit enhancement is also consistent with that of 2014-A.

Among the risks cited in the presale report is Fitch’s expectation that used car prices could level off or even weaken this year after rising for several years. This could reduce the value of vehicles coming off lease. The rating agency said this would likely lead to “moderately higher” loss rates. “Fitch’s analysis accounts for this risk by including periods of weak wholesale vehicle market performance in the derivation of residual and credit loss expectations,” the report states.

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