ABS

Notes will repay investors on a sequential basis, S&P said. One of S&P's rationales for assigning its ratings is the available credit support, including excess spread of 49.0%, 44.7%, 37.3% and 31.5% on classes A, B, C and D notes.

A deal to avoid a government shutdown resolves one immediate risk. But a major auto strike, the resumption of student-loan repayments, and a shutdown that may yet come back after the stop-gap spending deal lapses, could easily shave a percentage point off GDP growth in Q4.

Just one class of variable funding notes (VFN), which have an anticipated repayment date of July 2026, will be issued to investors.

On average the receivables have a balance of $971, a WA average percentage rate of 32.88%, and a WA age of 24 months. Also, cardholders might pay an annual membership of up to $75.

The deal will be secured by payments on subprime auto loans and comes shortly after officer Jill Rockwood joined as chief financial officer.

Equify ABS 2023-1 is expected to close on October 11 and will issue three classes of notes secured by revenue from mid- to large-ticket equipment contracts and related assets.

The deal is the eleventh this year for Pagaya AI Debt Selection Trust, and is slated to close by September 29.

Total hard credit enhancement of 37.45% shore up the class A notes, according to Moody's. In the rest of the deal the classes B, C and D notes benefit from total hard credit enhancement of 33.1%, 23.7% and 13.7%, respectively.

Revenue from agricultural and construction equipment will secure the notes, which get a boost from a spread account and overcollateralization.

Credit enhancement to the class A notes includes a non-declining overcollateralization of 4.75% of the initial adjusted pool balance, and a non-declining reserve fund of 0.25% of the initial adjusted pool balance.