DBRS Assigns Provisional Ratings to AmeriCredit Automobile Receivables Trust 2017-3

DBRS, Inc. (DBRS) has today assigned provisional ratings to the following classes of notes issued by AmeriCredit Automobile Receivables Trust 2017-3 (AMCAR 2017-3):

-- $227,000,000 Class A-1 at R-1 (high) (sf)
-- Class A-2-A at AAA (sf)*
-- Class A-2-B at AAA (sf)*
-- $240,460,000 Class A-3 at AAA (sf)
-- $94,700,000 Class B at AA (sf)
-- $117,500,000 Class C at A (sf)
-- $115,600,000 Class D at BBB (sf)

• The total Class A-2 size is expected to be $404,800,000, split between Classes A-2-A and A-2-B. Class A-2-B will be floating rate and will not exceed 75.00% of total Class A-2 issuance.

The provisional ratings are based on DBRS’s review 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 ratings address the timely payment of interest on a monthly basis and principal by the legal final maturity date.
-- AmeriCredit’s capabilities with regard to originations, underwriting and servicing and ownership by General Motors Company.
-- The credit quality of the collateral and performance of AmeriCredit’s auto loan portfolio.
-- The legal structure and presence of legal opinions that will address the true sale of the assets to the Issuer, the non-consolidation of the special-purpose vehicle with AmeriCredit, and that the Trust has a valid first-priority security interest in the assets and the consistency with DBRS’s “Legal Criteria for U.S. Structured Finance” methodology.

The receivables securitized in AMCAR 2017-3 will be subprime auto loan contracts secured by new and used automobiles, light-duty trucks and vans.

This transaction is being structured as a public transaction offering four classes of notes: Class A (split into three sequential tranches — Classes A-1, A-2 and A-3), Class B, Class C and Class D. The Class E Notes are not being publicly offered and will initially be retained by the Depositor or an affiliate thereof. Initial Class A credit enhancement of 35.20% will include a reserve account (2.00% of the initial pool balance, funded at inception and non-declining), overcollateralization (OC) of 5.75% and subordination of 27.45% of the initial pool balance. Initial Class B enhancement of 27.95% will include a 2.00% reserve account, 5.75% OC and 20.20% subordination. Initial Class C enhancement of 18.95% will include OC of 5.75%, subordination of 11.20% and a reserve account of 2.00%. Initial Class D enhancement of 10.10% will include OC of 5.75%, subordination of 2.35% and a reserve account of 2.00%. OC will build to a target of 14.75% of the pool balance, less the amount on deposit in the reserve account, based on excess spread available in the structure and will be subject to a floor of 0.50% of the initial pool balance.

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

The principal methodology is Rating U.S. Retail Auto Loan Securitizations, which can be found on dbrs.com 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.