Volkswagen extended its Driver auto loan securitization franchise into the French market via the €491 million ($650M) Driver France FCT Compartiment 2013-1 transaction.
The deal has been assigned preliminary ratings by Standard & Poor's. The €465 million, class A notes , structured with 8.20% credit enehancement are rated ‘AAA’. The class B notes, sized at €16.2 million and structured with 4.92% credit enehancement are rated ‘A+’. A €9.8 million subordinated loan provided by an affiliate of Volkswagen, has not been rated.
Volkswagen s acting through its French branch, Volkswagen Bank France. The collateral will comprise French fixed-rate amortizing auto loan receivables, which Volkswagen Bank France originated and granted to its private customer base.
S&P noted in the presale report that the pool is very granular. The largest single borrower represents 0.03% of the pool, and the top 20 obligors represent about 0.30% of the discounted pool balance.
The deal hits a pipeline that has seen little deal flow over the past week as Europe’s securitization market hit its tradition end of August lull. New issue activity for the month, as of Aug. 23 slowed to $1.4 billion ($1.87 billion).
The slowdown is in contrast to the pace the market saw in months prior.
Analysts at Deutsche Bank said in a report that activity in the market, in the past few months leading up to August, “could be described as anything but lackluster”. According to figures reported by the bank, approximately €21 billion of issuance occurred since the beginning of June until last week versus €12 billion over the same period last year.