Santander Consumer USA has come to market for a second time this year, with a $1.06 billion dollar issuance, backed by “subprime quality” retail installment auto loan contracts, according to a presale report from Moody’s Investor Services.
Loans in the trust have a weighted average Fico of 600, an average original term of 72 months, and a weighted average seasoning of three months – all relatively unchanged from the bank’s issuances in 2015.
“The historical cumulative net loss performance of SDART’s auto ABS transactions is weak relative to other subprime issuers,” Moody’s wrote in the report, and estimated the median cumulative net loss rate for the 2016-1 trust at 17%.
SC will continue to focus on ABS as a “stable funding source,” Deputy Financial Officer Jennifer Davis said during the company’s recent fourth quarter 2015 earnings call. The bank has planned a robust issuance calendar for 2016, she added.
SC issued its first auto securitization for 2016 under its Drive platform in mid-January backed by $752.2 million in deep subprime auto loans.
