DBRS Confirms Rating on ARI Funding 9 LLC

DBRS, Inc. (DBRS) has confirmed the AA (sf) rating on the ARI Funding 9 LLC warehouse facility secured by fleet leases originated by Automotive Rentals, Inc. (ARI). The facility has been reduced to $150 million from $250 million when the program was first rated in April 2012.

The confirmation takes into consideration amendments that modify the revolving period, credit enhancement, and concentration limits. Current performance of the transaction is in line with DBRS expectations.

The originator, Automotive Rentals Inc. (“ARI”), is a fleet services provider specializing in complex car and truck fleets. Overall performance in ARI’s managed portfolio has been excellent. Although there are some special obligors in the pool, the pool is well diversified because ARI provides leasing and management services to multiple industries. The performance is taken into account when DBRS evaluates this asset class, but the obligor and special obligor concentrations drive our loss assumptions. DBRS also assumes that the leases would be rejected in Bankruptcy but in the limited number of obligor bankruptcies ARI has experienced over the last few years, leases have been affirmed resulting in continued collection of lease payments.

The transaction is protected by enhancement equivalent to four times coverage of maximum obligor concentrations after giving credit for recoveries.

Notes:
The applicable methodology is DBRS Master U.S. ABS Surveillance Methodology, which can be found on our website under Methodologies.

This rating is endorsed by DBRS Ratings Limited for use in the European Union.