RPT-Fitch Expects to Rate AmeriCredit Automobile Receivables Trust 2013-2
April 1 (Reuters) - (The following statement was released by the rating agency)
Fitch Ratings expects to assign the following ratings and Rating Outlooks to the notes issued by AmeriCredit Automobile Receivables Trust 2013-2:
--$214,700,000 class A-1 notes 'F1+sf';
--$382,800,000 class A-2 notes 'AAAsf'; Outlook Stable;
--$183,800,000 class A-3 notes 'AAAsf'; Outlook Stable;
--$84,170,000 class B notes 'AAsf'; Outlook Stable;
--$104,490,000 class C notes 'Asf'; Outlook Stable;
--$102,750,000 class D notes 'BBBsf'; Outlook Stable;
--$27,290,000 class E notes 'BBsf'; Outlook Stable.
KEY RATING DRIVERS
Consistent Credit Quality: The credit quality of 2013-2 is consistent with 2013-1 and 2012 transactions. The weighted average (WA) Fair Isaac Corp. (FICO) score is 566, and WA internal credit score is 240. Used cars total 56.7% and WA loan-to-value (LTV) ratio is 110%, all consistent with recent pools. Consistent Credit Enhancement Structure: The cash flow distribution is a sequential-pay structure. Initial hard credit enhancement (CE) is consistent with the last four transactions. The reserve is 2.00% (non-declining) and initial overcollateralization (OC) is 5.25% (both of the initial pool balance), growing to a target of 14.25% of the current pool balance, less the reserve. Stronger Portfolio/Securitization Performance: Losses on GM Financial's portfolio and 2009 - 2012 AMCAR securitizations have declined to some of the lowest levels ever seen, supported by the gradual economic recovery and strong used vehicle values supporting higher recovery rates. Stable Corporate Health: Fitch rates GM 'BB+' with a Stable Outlook, and GM Financial 'BB' with a Positive Watch. GM Financial recorded positive corporate financial results since 2010, and the overall health of GM has also improved. Consistent Origination/Underwriting/Servicing: AFSI demonstrates adequate abilities as originator, underwriter, and servicer, as evidenced by historical portfolio delinquency and loss experience and securitization performance. Fitch deems AFSI capable of adequately servicing this series.
Unanticipated increases in the frequency of defaults and loss severity on defaulted receivables could produce CNL levels higher than the base case and would likely result in declines of CE and remaining loss coverage levels available to the notes. Decreased CE may make certain note ratings susceptible to potential negative rating actions, depending on the extent of the decline in coverage. Hence, Fitch conducts sensitivity analysis by stressing a transaction's initial base case CNL assumption by 1.5x and 2.5x and examining the rating implications on all classes of issued notes. The 1.5x and 2.5x increases of the base case CNL represent moderate and severe stresses, respectively, and are intended to provide an indication of the rating sensitivity of notes to unexpected deterioration of a trust's performance.
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