CPS Announces $240.0 Million Senior Subordinate Asset-Backed Securitization

Rhea-AI Summary

Consumer Portfolio Services (Nasdaq: CPSS) has successfully closed its second term securitization for 2021, totaling $240 million in asset-backed notes secured by automobile receivables. This marks the 39th securitization since 2011, maintaining a commendable record of receiving a triple 'A' rating from at least two agencies. The transaction includes five classes of notes with a weighted average coupon of 1.65%. Initial credit enhancement is set at 1% of the original receivable pool, and CPS plans to sell an additional $84.5 million in receivables in May 2021.

Positive

• Successfully closed a $240 million securitization, enhancing liquidity.
• Maintained a strong rating of triple 'A' from multiple agencies for all senior notes.
• Initial credit enhancement set at 1% of original receivable pool indicates strong financial structuring.

Negative

• None.

LAS VEGAS, Nevada, April 28, 2021 (GLOBE NEWSWIRE) -- Consumer Portfolio Services, Inc. (Nasdaq: CPSS) (“CPS” or the “Company”) today announced the closing of its second term securitization in 2021. The transaction is CPS's 39th senior subordinate securitization since the beginning of 2011 and the 22nd consecutive securitization to receive a triple “A” rating from at least two rating agencies on the senior class of notes.

In the transaction, qualified institutional buyers purchased $240.0 million of asset-backed notes secured by $240.0 million in automobile receivables originated by CPS. The sold notes, issued by CPS Auto Receivables Trust 2021-B, consist of five classes. Ratings of the notes were provided by Moody’s and DBRS Morningstar, and were based on the structure of the transaction, the historical performance of similar receivables and CPS’s experience as a servicer.

Note Class	Amount (in millions)		Interest Rate		Average Life (years)	Price		Moody’s Rating	DBRS Rating
A	$125.640		0.37	%	0.70	99.99532	%	Aaa	AAA
B	$30.000		0.81	%	1.90	99.99506	%	Aa1	AA
C	$36.360		1.23	%	2.57	99.99538	%	A2	A
D	$18.000		1.52	%	3.26	99.99314	%	Baa3	BBB
E	$30.000		3.41	%	3.96	99.98304	%	NR	BB

The weighted average coupon on the notes is approximately 1.65%.  

The 2021-B transaction has initial credit enhancement consisting of a cash deposit equal to 1.00% of the original receivable pool balance. The transaction agreements require accelerated payment of principal on the notes to reach overcollateralization of the lesser of 7.00% of the original receivable pool balance, or 26.00% of the then outstanding pool balance.

The transaction utilizes a pre-funding structure, in which CPS sold approximately $155.5 million of receivables at inception and plans to sell approximately $84.5 million of additional receivables in May 2021. This further sale is intended to provide CPS with long-term financing for receivables purchased pri

FAQ

What was the amount of the recent securitization by CPSS?

Consumer Portfolio Services closed a $240 million securitization secured by automobile receivables.

How many securitizations has CPSS completed since 2011?

CPSS has completed 39 securitizations since the beginning of 2011.

What is the weighted average coupon on the notes from CPSS's recent securitization?

The weighted average coupon on the notes is approximately 1.65%.

When does CPSS plan to sell additional receivables?

CPSS plans to sell approximately $84.5 million of additional receivables in May 2021.