DBRS Assigns Rating to AT&T Receivables Funding, LLC

DBRS, Inc. (DBRS) assigned a rating of A (sf) to the September 28, 2017, Investment (the Investment) and defined yield created under the Second Receivables Purchase Agreement (the Purchase Agreement) dated September 28, 2017, among AT&T Receivables Funding, LLC as the Seller; New Cingular Wireless PCS, LLC, doing business as AT&T Mobility, as the Servicer, the pool purchaser agents from time to time and the pool purchasers from time to time; and Citibank, N.A. as the Agent. The Investment was made in an amortizing pool of receivables that were originated by AT&T Mobility for obligors to finance the purchase of mobile phones and were sold by the Seller under the Purchase Agreement.

RATING RATIONALE
The ratings are based on DBRS’s review of the following analytical considerations:
-- Transaction advance rate, form and sufficiency of available credit enhancement and assigned ratings. The transaction benefits from (1) credit enhancement in the form of overcollateralization, implied excess spread and a full turbo structure, credit enhancement levels that are sufficient to support the DBRS expected loss under various stress scenarios and (2) other benefits provided by the structured Investment, including (a) a discrete pool of assets via specified selection criteria, (b) the application of conservative assumptions assumed in the stress analysis and (c) the inclusion of additional enhancement provided by cross-collateralization from outstanding pool purchases.
-- DBRS has performed an operational review of the servicer of the receivables and considers the entity to be an acceptable servicer of handset loans.
-- DBRS was provided sufficient performance data from program-originated contracts.
-- The transaction pool contained high-quality collateral characteristics.
-- The legal structure and presence of legal opinions will address the true sale of the assets to the purchasers; the non-consolidation of the special-purpose vehicles with AT&T Receivables Funding, LLC; and that the purchasers have a valid first-priority security interest in the assets and are consistent with DBRS’s “Legal Criteria for U.S. Structured Finance” methodology.

Notes:
The principal methodology is Rating U.S. Structured Finance Transactions (December 2016), including the appendix related to rating U.S. Consumer Loan ABS Transactions, 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.

For the purpose of clarity, the Investment has been categorized under Debt Rated in the Rating Table below.