DBRS Assigns Provisional Ratings to Asset-Backed Notes to Be Issued by CCG Receivables Trust 2016-1

DBRS, Inc. (DBRS) has today assigned provisional ratings to the following classes of the asset-backed notes (the Notes) to be issued by CCG Receivables Trust 2016-1:

-- Class A-1 Notes rated R-1 (high) (sf)
-- Class A-2 Notes rated AAA (sf)
-- Class B Notes rated A (high) (sf)

This issuance represents the sixth term asset-backed securitization sponsored by Commercial Credit Group, Inc. (CCG) and rated by DBRS, which is secured by a larger small-ticket equipment loan and lease contracts, security interest in the related equipment and related accounts, insurance proceeds and other related assets. The Notes will be issued under Rule 144A. The provisional ratings assigned by DBRS to each class of Notes are based on the following considerations:

-- Credit enhancement available to each class of Notes is sufficient to ensure timely periodic interest payments and repayment of principal by the final maturity date for each class of Notes in DBRS’s cash flow modeling analysis.
-- The sequential amortization of the Notes, subordination, the non-declining replenishable reserve amount and the overcollateralization floor are expected to create credit enhancement for the Notes that increases over time.
-- The historical performance of the assets originated by CCG with respect to recoveries and net losses has been consistent.
-- The expected collateral pool is granular. The collateral composition is similar to that included in CCG’s previous term securitizations, all of which have performed well within DBRS’s expectations.
-- The originator’s management team has considerable experience and expertise in the equipment leasing industry and continues to maintain a strong competitive position by focusing on financing of the essential income-producing commercial equipment to small and medium-sized businesses.
-- A satisfactory review of the legal structure and presence of legal opinions that address true sale and non-consolidation of the assets, which are held by the special-purpose vehicle, and a valid first-priority security interest of the Indenture Trustee in the assets. The transaction is also reviewed for consistency with the DBRS “Legal Criteria for U.S. Structured Finance.”
-- The presence of Portfolio Financial Services Company, an experienced servicer of equipment-backed collateral, as the Backup Servicer for this transaction.

Notes:
All figures are in U.S. dollars unless otherwise noted.

The rated entity or its related entities did participate in the rating process. DBRS had access to the accounts and other relevant internal documents of the rated entity or its related entities.

The applicable methodology is Rating U.S. Equipment Lease and Loan Securitizations (June 2015), which can be found on our website under Methodologies.

Please see the attached appendix for additional information regarding sensitivity of assumptions used in the rating process.

The full report providing additional analytical detail is available by clicking on the link below or by contacting us at info@dbrs.com.