DBRS Confirms Ratings of Liquidity Agreements Supporting Pool Number 235 within Old Line Funding

DBRS, Inc. (DBRS) confirmed ratings of the Liquidity Asset Purchase Agreements (LAPAs), dated as of March 10, 2016, by and among Old Line Funding, LLC, a Delaware limited liability company, as Issuer and the Royal Bank of Canada as Purchaser and Liquidity Agent. The ratings of the LAPAs will support Old Line Funding, LLC.

-- Old Line Funding, LLC – Liquidity Agreement Supporting Pool Number 235A: AAA (sf)
-- Old Line Funding, LLC – Liquidity Agreement Supporting Pool Number 235B: AA (sf)
-- Old Line Funding, LLC – Liquidity Agreement Supporting Pool Number 235C: AA (sf)
-- Old Line Funding, LLC – Liquidity Agreement Supporting Pool Number 235E: AA (sf)
-- Old Line Funding, LLC – Liquidity Agreement Supporting Pool Number 235F: A (sf)

The ratings assumes that the LAPAs been invoked, and as such, the Liquidity Institution is the investor of the notes secured by a revolving pool of automobile leases, automobile loans and wholesale securitizations.

DBRS has confirmed ratings of five variable funding asset-backed notes collateralized by auto loans, auto leases and wholesale dealer floorplan receivables. These receivables are generated by a nationally recognized finance company and its subsidiaries (the Company). The ratings address the timely payment of interest and ultimate payment of principal of the notes in accordance with the transaction documents.

Consistent with the DBRS “Rating U.S. Retail Auto Loan Securitizations,” “Rating U.S. Auto Lease Securitizations” and “Rating U.S. Wholesale Securitizations” methodologies and as part of the operational risk review of an originator and servicer, DBRS typically performs an on-site visit or has a call with the originator and servicer. For this transaction, DBRS was asked to provide the rating by the Committed Purchaser, Royal Bank of Canada, not the servicer or any affiliate. This resulted in limited access to the Company; consequently, no on-site review or call was conducted by DBRS.

DBRS deems the operational capacity of the Company to be acceptable, with potential risks related to not conducting an on-site review or call mitigated by a number of factors, including the following:

(1) The Company is rated BBB (low)/R-3 with Stable trends by DBRS.

(2) The Company has sponsored and serviced numerous securitizations of auto loans, auto leases and wholesale dealer floorplans supported by its own originated collateral.

(3) DBRS deems the Company to be an experienced originator and servicer, which is demonstrated by strong performance on its outstanding transactions.

(4) DBRS reviewed credit materials prepared in connection with this transaction.

The Retail Loan and Lease Facilities include derivative counterparties. Some of these counterparties have ratings below the level of A (high) set forth in the DBRS “Legal Criteria for U.S. Structured Finance” methodology. However, given the ratings of such counterparties, the replacement threshold of below “A” and the diversity of hedge counterparties, DBRS believes the associated risk is consistent with the assigned ratings on the individual facilities.

Notes:
The rated entity or its related entities did participate in the rating process for this rating action. DBRS had access to the accounts and other relevant internal documents of the rated entity or its related entities in connection with this rating action.

The principal methodologies are Asset-Backed Commercial Paper Criteria Report: U.S. ABCP Conduits, Rating U.S. Retail Auto Loan Securitizations, Rating U.S. Auto Lease Securitizations and Rating U.S. Wholesale Securitizations, which can be found on dbrs.com under Methodologies.

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