American Heritage FCU issues first auto ABS deal (Big Wheels)

American Heritage Federal Credit Union has issued its first auto asset-backed-securitization deal, pushing credit unions' total transaction volume for the year beyond last year’s record high. Philadelphia-based American Heritage on Nov. 13 issued a $300 million auto asset-backed-securitization (ABS) transaction backed by prime auto loans, according to Finsight , which monitors securities. American Heritage had $4.8 billion in total assets as of Sept. 30, with 22.1% consisting of motor vehicle loans or retail installment sales contracts, according to a Nov. 7 S&P Global presale report. Auto loans accounted for 29% of the company's loan portfolio as of Sept. 30, with around 88% in indirect lending for new and used vehicles. The lender had 396 dealer partners as of July, with 85% franchised dealerships, according to the report. American Heritage’s auto portfolio totaled about $966.3 million as of Sept. 30, down 2.3% year over year, according to the report. Meanwhile, net charge-offs came in at 0.46%, while 30-plus-day delinquencies were 2.16% , up from 1.44% a year earlier. CU auto ABS issuance surpasses $2B The latest transaction brings credit union auto ABS issuance to $2.4 billion across six deals this year, surpassing 2023’s record of around $2 billion, according to an Auto Finance News analysis of deals on Finsight. Year-to-date total auto ABS volume reached $161.1 billion as of Nov. 22, an 11.5% year-over-year increase, according to data from JPMorgan Securities . By comparison, $146 billion in auto ABS was issued in all of 2023. Other credit union ABS issuances this year, according to Finsight, include: GreenState Credit Union issued its inaugural deal on March 11, a $400 million transaction; Valley Strong Credit Union issued a $296 million transaction on March 19, which followed its first auto ABS deal in October 2023; First Community Credit Union came to market for the first time on May 22 with a $251 million deal; Space Coast Credit Union came to market with a $669 million issuance July 11, its second since a $422 million deal in December 2023; and PenFed Credit Union issued a $447 million deal on Aug. 13, the lender’s second issuance, following a $485 million deal in August 2022. Credit unions were granted the green light to issue in the securitization market in 2017 in an opinion by the National Credit Union Administration . GTE Financial became the first credit union to come to market , with a $147 million deal on Nov. 8, 2019, according to S&P Global Ratings . The Big Wheels Data service has been relaunched and reimagined to include an array of valuable industry datasets and dashboards. See BigWheelsData for details.

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