LONDON, March 17 (IFR) - Volkswagen Bank is marketing a
French auto loan ABS, offering much-needed supply and
potentially tight spreads.
Driver Three is expected to offer a €448m Triple A rated
(S&P/DBRS) Class A tranche with a weighted average life of 1.23
years and 11.60% credit enhancement. It is also expected to
offer €19.5m of Class B notes, with a weighted average life of
1.33 years and credit enhancement of 7.70%.
Coupons have not been set.
The deal comes two weeks after Driver Five, off Volkswagen's
UK auto loan issuance shelf, which saw €340m of Class As price
at a tight 45bp over one-month Libor.
Though that was in sterling, levels pointed to a marked
improvement in ABS deal execution for Volkswagen since its
September 2015 emissions scandal.
“I think the French auto space is usually pretty tight - too
tight for us, unfortunately. But a great deal, no doubt, from a
fundamental point of view,” said an investor.
The provisional portfolio for Driver Three is composed of
60,883 contracts with an average size of €8,212.5. The majority
of the collateral, 57.75%, is made up of new car loans. The
remainder is composed of used car loans.
The roadshow starts in France on March 20 and will continue
to Germany, Holland, and London through to Wednesday, March 22.
The joint leads and bookrunners are Commerzbank and HSBC.
The co-managers are DZ Bank, ING, and SEB.
(This story will appear in the March 18 issue of IFR Magazine)