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KBRA Assigns Preliminary Ratings to Notes Issued by Continental Credit Card ABS 2019-1, LLC

NEW YORK--(BUSINESS WIRE)--

Kroll Bond Rating Agency (KBRA) assigns preliminary ratings to three classes of notes issued by Continental Credit Card ABS 2019-1, LLC (“CFCC 2019-1”), a credit card ABS transaction.

CFCC 2019-1 will issue three classes of notes in an aggregate principal amount of $127.62 million with a closing date of August 28, 2019. The Notes are backed by a pool of non-prime credit card accounts. Accounts are originated by The Bank of Missouri and Celtic Bank Incorporated.

The transaction has a two-year revolving period where no principal payments will be made on the notes during this time unless an Early Amortization Event occurs. During the amortization period, no new accounts will be added, and available funds can be used to purchase new receivables from existing accounts, pay fees and interest and pay principal on the notes sequentially. The waterfall is the same during the amortization period independent if it is the scheduled amortization period or an Early Amortization Event occurred.

CFC a privately held consumer finance company that was established in 2005 and issues general purpose credit cards with the MasterCard brand. CFC is owned directly or indirectly by its founders and as of June 30, 2019, had total assets of approximately $169.9 million. The founders and principals of CFC have experience in the financial services, credit card lending and consumer banking industry. As of June 30, 2019, CFC services approximately 483,000 credit card accounts with an aggregate outstanding balance of approximately $222.1 million.

The preliminary ratings reflect the initial credit enhancement levels ranging from 42.00% for the Class A notes to 5.00% for the Class C notes. Credit enhancement on the notes consists of i) excess cash flow generated by the pool of credit card loans ii) overcollateralization iii) a spread account and iv) subordination (in the case of the Class A Notes, and Class B Notes).

KBRA analyzed the transaction using the Global Credit Card ABS Rating Methodology published on November 28, 2017 and the Structured Finance Counterparty Methodology published on August 8, 2018. KBRA’s credit card methodology incorporates an analysis of: (1) the quality and expected performance of the underlying collateral, (2) the originator’s and servicer’s business model and operational capabilities and (3) the transaction terms, including capital structure, credit enhancement and legal structure.

To access ratings, reports and disclosures, click here.

Preliminary Ratings: Continental Credit Card ABS 2019-1, LLC

Class

Preliminary Rating

Principal Balance

A

A (sf)

$77,910,000

B

BBB (sf)

$22,170,000

C

BB- (sf)

$27,540,000

Related Publications: (available at www.kbra.com)

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About KBRA and KBRA Europe

KBRA is a full-service credit rating agency registered with the U.S. Securities and Exchange Commission as an NRSRO. In addition, KBRA is designated as a designated rating organization by the Ontario Securities Commission for issuers of asset-backed securities to file a short form prospectus or shelf prospectus. KBRA is also recognized by the National Association of Insurance Commissioners as a Credit Rating Provider, and is a certified Credit Rating Agency (CRA) by the European Securities and Markets Authority (ESMA). Kroll Bond Rating Agency Europe Limited is registered with ESMA as a CRA.

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