(Repeat for additional subscribers)
June 9 (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 Nissan Auto Lease Trust 2014-A:
--Class A-1 asset-backed notes 'F1+sf';
--Class A-2a asset-backed notes 'AAAsf'; Outlook Stable;
--Class A-2b asset-backed notes 'AAAsf'; Outlook Stable;
--Class A-3 asset-backed notes 'AAAsf'; Outlook Stable;
--Class A-4 asset-backed notes 'AAAsf'; Outlook Stable.
KEY RATING DRIVERS
Stable Collateral Quality: 2014-A is consistent with prior NALT transactions
with a weighted average (WA) FICO score of 741, similar vehicle composition and
seasoning of 13 months. The pool is primarily composed of 39-month leases and
the base residual value percentage has decreased to 70.12% from 71.34% for NALT
Adequate Credit Enhancement Structure: 2014-A incorporates a sequential-pay
structure. Initial credit enhancement (CE) is expected to be 16.50% of the
initial securitization value, growing to 17.50% of the initial securitization
value, a decrease from NALT 2013-B. Excess spread is expected to be 5.22%.
Strong Credit Loss: Credit losses on NMAC's portfolio and recent NALT
securitizations have declined significantly from the elevated levels seen in
2007 and 2008. This is supported by improved credit quality and a strong
wholesale used vehicle market resulting in higher recovery rates.
Weakening Residual Performance: While residual losses on NMAC's portfolio and
recent NALT securitizations remain well below the elevated levels seen in 2007
and 2008, performance has displayed some weakening.
Stabilizing Wholesale Market: The U.S. wholesale market has remained strong in
recent years however increasing off-lease supply and pressure from increased
production levels is leading to lower residual realization as exhibited by
several auto finance companies. Fitch has accounted for this in its 'AAAsf'
stressed residual loss expectation of 29.7%.
Legal Structure Integrity: The legal structure of the transaction should provide
that a bankruptcy of NMAC would not impair the timeliness of payments on
Unanticipated decreases in the value of returned vehicles and/or increases in
the frequency of defaults and loss severity on defaulted receivables could
produce loss levels higher than the base case. This would likely result in
declines of credit enhancement and loss coverage levels available to the notes.
Hence, Fitch conducts sensitivity analyses by increasing the transaction's
initial base case RV and credit loss assumptions and examining the rating
implications on all classes of issued notes. The increases to the base case
losses are applied such that they represent moderate (1.5x) and severe (2.5X)
stresses, respectively, and are intended to provide an indication of the rating
sensitivity of notes to unexpected deterioration of a trust's performance.
The presale report is available at 'www.fitchratings.com' or by clicking the
Link to Fitch Ratings' Report: Nissan Auto Lease Trust 2014-A (US ABS)