CPS Announces $307.0 Million Senior Subordinate Asset-Backed Securitization

Rhea-AI Summary

Consumer Portfolio Services (Nasdaq: CPSS) has completed its fourth term securitization of 2022, marking the 45th senior subordinate securitization since 2011. The $307.0 million in asset-backed notes, secured by $337.4 million in automobile receivables, were purchased by institutional buyers. This deal is notable as it continues the trend of achieving a triple 'A' rating for the 28th consecutive time from two rating agencies. The weighted average coupon on the notes is approximately 8.48%, and initial credit enhancement includes a cash deposit of 1.20% and 9.00% overcollateralization.

Positive

• Achieved a total of $307.0 million in asset-backed notes issuance.
• 28th consecutive securitization receiving a triple 'A' rating.
• Notable credit enhancement with 1.20% cash deposit and 9.00% overcollateralization.

Negative

• None.

LAS VEGAS, Oct. 26, 2022 (GLOBE NEWSWIRE) -- Consumer Portfolio Services, Inc. (Nasdaq: CPSS) (“CPS” or the “Company”) today announced the closing of its fourth term securitization in 2022. The transaction is CPS's 45th senior subordinate securitization since the beginning of 2011 and the 28^th 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 $307.0 million of asset-backed notes secured by $337.4 million in automobile receivables originated by CPS.   The sold notes, issued by CPS Auto Receivables Trust 2022-D, 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	$ 172.065		6.09%	0.85	99.99296%	Aaa	AAA
B	$ 30.360		6.84%	2.03	99.99159%	Aa1	AA
C	$ 45.888		7.69%	2.69	99.98702%	A1	A
D	$ 22.605		8.73%	3.44	99.99868%	Baa3	BBB
E	$ 36.100		12.12%	4.01	99.97467%	NR	BB

The weighted average coupon on the notes is approximately 8.48%.  

The 2022-D transaction has initial credit enhancement consisting of a cash deposit equal to 1.20% of the original receivable pool balance and overcollateralization of 9.00%. The transaction agreements require accelerated payment of principal on the notes to reach overcollateralization of the lesser of 10.50% of the original receivable pool balance, or 25.00% of the then outstanding pool balance.

The transaction was a private offering of securities, not registered under the Securities Act of 1933, or any state securities law. All such securities having been sold, this announcement of their sale appears as a matter of record only.

About Consumer Portfolio Services, Inc.

Consumer Portfolio Services, Inc. is an independent specialty finance company that provides indirect automobile financing to individuals with past credit problems or limited credit histories. We purchase retail installment sales contracts primarily from franchised automobile dealerships secured by late model used vehicles and, to a lesser extent, new vehicles. We fund these contract purchases on a long-term basis through the securitization markets and service the loans over their entire contract terms.

Investor Relations Contact

Danny Bharwani, Chief Financial Officer
949-753-6811 

FAQ

What recent financial milestone did CPSS achieve?

Consumer Portfolio Services closed its fourth term securitization of 2022, totaling $307.0 million in asset-backed notes.

How many securitizations has CPSS completed since 2011?

CPSS has completed 45 senior subordinate securitizations since the beginning of 2011.

What was the average coupon rate for the notes issued by CPSS?

The weighted average coupon on the notes is approximately 8.48%.

What type of receivables secured the asset-backed notes by CPSS?

The asset-backed notes were secured by $337.4 million in automobile receivables originated by CPSS.

What kind of credit rating did the recent securitization receive?

The securitization received a triple 'A' rating from at least two rating agencies.