DBRS Assigns Provisional Ratings to Westlake Automobile Receivables Trust 2016-2

DBRS, Inc. (DBRS) has today assigned provisional ratings to the following classes issued by Westlake Automobile Receivables Trust 2016-2:

-- $149,000,000 Class A-1 rated R-1 (high) (sf)
-- Class A-2-A rated AAA (sf)*
-- Class A-2-B rated AAA (sf)*
-- $42,000,000 Class B rated AA (sf)
-- $60,800,000 Class C rated A (sf)
-- $50,660,000 Class D rated BBB (sf)
-- $28,540,000 Class E rated BB (sf)

*The combination of Classes A-2-A and A-2-B is expected to equal $219 million.

The provisional ratings are based on a review by DBRS of the following analytical considerations:
-- Transaction capital structure, proposed ratings and form and sufficiency of available credit enhancement.
-- The ability of the transaction to withstand stressed cash flow assumptions and repay investors according to the terms under which they have invested. For this transaction, the rating addresses the payment of timely interest on a monthly basis and principal by the legal final maturity date for each class.
-- The credit quality of the collateral and performance of the auto loan portfolio by origination channels.
-- The capabilities of Westlake Services, LLC (Westlake) with regard to originations, underwriting and servicing.
-- The quality and consistency of provided historical static pool data for Westlake originations and performance of the Westlake auto loan portfolio.
-- Wells Fargo Bank, N.A. (rated AA (high)/R-1 (high)/Stable by DBRS) has served as a backup servicer for Westlake since 2003, when a conduit facility was put in place.
-- The legal structure and presence of legal opinions that address the true sale of the assets to the Issuer, the non-consolidation of the special-purpose vehicle with Westlake, that the trust has a valid first-priority security interest in the assets and the consistency with the DBRS “Legal Criteria for U.S. Structured Finance” methodology.

The collateral securing the notes consists primarily of a pool of retail automobile contracts secured by predominantly used vehicles that typically have high mileage. The loans are primarily made to obligors that are categorized as subprime, largely because of their credit history and credit scores.

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

The applicable methodology is Rating U.S. Retail Auto Loan Securitizations, which can be found on our website under Methodologies.

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.

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 under Related Research at the right of the screen or by contacting us at info@dbrs.com.