DBRS Confirms Ratings on Globaldrive UK Dealer Floorplan Funding I Limited Series 2007-1 and 2010-1 Asset Backed Floating Rate Notes

DBRS, Inc. (DBRS) has confirmed the AAA (sf) ratings of Globaldrive UK Dealer Floorplan Funding I Limited (Funding I), Asset Backed Floating Rate Notes, Series 2007-1 and Series 2010-1.

Funding I is a beneficiary of a trust consisting of wholesale auto receivables from FCE Bank Plc’s (FCE Bank) UK wholesale portfolio. FCE Bank is a wholly owned subsidiary of FCSH GmbH (Switzerland), itself a wholly owned subsidiary of Ford Credit International, Inc. (USA). DBRS considers these assets to be core assets of FCE Bank, whose ultimate parent is Ford Motor Company USA.

The rating confirmation is based upon review by DBRS of the following analytical considerations:

-- The transaction provides the Issuer the ability to finance vehicles in England, Wales, Scotland, Northern Ireland, the Isle of Man, Jersey or Guernsey.
-- The transaction amendments, as well as certain other program amendments, were analyzed in DBRS’s reconfirmation process.
-- Transaction capital structure and form and sufficiency of available credit enhancement.
-- DBRS review of historical market data to determine the sufficiency of available credit enhancement relative to the assumed market value stresses in the event of a vehicle liquidation.
-- The credit enhancement for each series of 27.85% overcollateralization and/or subordination, and a cash reserve account (0.85% of the Class A balance of each series).
-- The minimum seller interest at the greater of £1 or the sum of overconcentration and ineligible receivables.
-- These credit enhancement levels are sufficient to support various stress assumptions to vehicle liquidations and/or dealer concentration levels under the AAA (sf) standard for the Class A Notes of each series.
-- The transaction parties’ financial strength, historical presence and capabilities with respect to managing the wholesale operations and the dealer network in the region.
-- The legal structure and presence of legal opinions addressing the assignment of the assets to the Issuer and consistency with the DBRS Legal Criteria for European Structured Finance Transactions.

Notes:
All figures are in British pounds sterling unless otherwise noted.

The principal methodology applicable is Rating U.S. Wholesale Auto Securitizations.

DBRS has applied the principal methodology consistently and conducted a review of the transaction in accordance with the principal methodology.

A cash flow analysis was conducted for each series. However, due to the inclusion of a revolving period in the transaction and no change in assumptions, the initial analysis based on worst-case criteria set forth in the transaction legal documents was assumed.

Other methodologies referenced in this transaction are listed at the end of this press release.

These may be found on www.dbrs.com at: http://www.dbrs.com/about/methodologies.

For a more detailed discussion of the sovereign risk impact on Structured Finance ratings, please refer to DBRS commentary “The Effect of Sovereign Risk on Securitisations in the Euro Area” on: http://www.dbrs.com/industries/bucket/id/10036/name/commentaries/.

The sources of information used for this rating include monthly investor reports and certain historical performance information provided by FCE Bank. DBRS considers the information available to it for the purposes of providing this rating was of satisfactory quality.

DBRS does not rely upon third-party due diligence in order to conduct its analysis.

DBRS was not supplied with third-party assessments. However, this did not impact the rating analysis.

DBRS does not audit the information it receives in connection with the rating process, and it does not and cannot independently verify that information in every instance.

The last rating action on this transaction took place on 12 June 2015, when the ratings were confirmed.

Information regarding DBRS ratings, including definitions, policies and methodologies, is available on www.dbrs.com.

Under typical stress assumptions, DBRS assumes the payment rate trigger is breached and the modelling scenarios decline to a floor of 50% below that trigger. Along with this stress, DBRS also assumes losses increase in its AAA scenarios. To assess the impact of changing certain transaction parameters on the rating, DBRS concludes that for the Class A Notes of each series:
-- A hypothetical decrease of the base case payment rate stress by 25% or a hypothetical increase in default rates by 25%, ceteris paribus, would not lead to a change in the ratings of the Class A Notes.
-- A hypothetical decrease of the base case payment rate stress by 50% or a hypothetical increase in default rates by 50%, ceteris paribus, would not lead to a change in the ratings of the Class A Notes.

This rating included participation by the rated entity or any related third party. DBRS had access to accounts, management and other relevant internal documents for the rated entity or a related third party.

For further information on DBRS historical default rates published by the European Securities and Markets Authority (“ESMA”) in a central repository, see: http://cerep.esma.europa.eu/cerep-web/statistics/defaults.xhtml.

This credit rating has been issued outside the European Union (EU) and is endorsed by DBRS Ratings Limited. It may be used for regulatory purposes by financial institutions in the EU.

Lead Analyst: Chris O’Connell, Senior Vice President, US ABS - Global Structured Finance
Rating Committee Chair: Chuck Weilamann, Managing Director, Head of US ABS – Global Structured Finance
Series 2007-1 Initial Rating Date: June 2012
Series 2010-1 Initial Rating Date: January 2010

DBRS, Inc.
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New York, NY 10005 USA

The rating methodologies and criteria used in the analysis of this transaction can be found at: http://www.dbrs.com/about/methodologies.

-- Rating U.S. Wholesale Securitizations
-- Legal Criteria for U.S. Structured Finance Transactions
-- Operational Risk Assessment for U.S. ABS Servicers
-- DBRS Master U.S. ABS Surveillance Methodology

A description of how DBRS analysis structured finance transactions and how the methodologies are collectively applied can be found at: http://www.dbrs.com/research/278375.