DBRS Assigns Provisional Ratings to Prestige Auto Receivables Trust 2018-1

DBRS, Inc. (DBRS) assigned provisional ratings to the following classes of notes to be issued by Prestige Auto Receivables Trust 2018-1 (PART 2018-1):

-- $70,000,000 Class A-1 Notes rated R-1 (high) (sf)
-- $130,000,000 Class A-2 Notes rated AAA (sf)
-- $51,480,000 Class A-3 Notes rated AAA (sf)
-- $39,360,000 Class B Notes rated AA (sf)
-- $55,760,000 Class C Notes rated A (sf)
-- $42,640,000 Class D Notes rated BBB (sf)
-- $18,590,000 Class E Notes rated BB (sf)

The 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.
-- Credit enhancement is in the form of overcollateralization, subordination, amounts held in the reserve account and excess spread. Credit enhancement levels are sufficient to support DBRS projected expected cumulative net loss assumptions under various stress scenarios.
-- 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 payment of timely interest on a monthly basis and principal by the legal final maturity date.
-- The transaction parties’ capabilities with regard to originations, underwriting and servicing.
-- DBRS has performed an operational risk review of Prestige Financial Services, Inc. (Prestige) and considers the entity to be an acceptable originator and servicer of subprime auto receivables with an acceptable backup servicer.
-- Prestige’s management team has extensive experience. They have been lending to the subprime auto sector since 1994 and have considerable experience lending to Chapter 7 and 13 obligors.
-- The credit quality of the collateral and performance of Prestige’s auto loan portfolio.
-- DBRS base case cumulative net loss (CNL) assumed for modeling purposes was 13.70%. Prestige shared vintage CNL data with DBRS that dates back to 2009. The data was broken down by payment to income ratio and other buckets. The analysis indicated a pattern of increasing losses that was consistent with expected trends.
-- Prestige continues to evaluate and adjust its underwriting standards as necessary to target and maintain the credit quality of its loan portfolio.
-- DBRS rating category loss multiples for each rating assigned are within the published criteria.
-- 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 Prestige and that the trust has a valid first-priority security interest in the assets and consistency with the DBRS “Legal Criteria for U.S. Structured Finance.”

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 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.

Please see the related appendix for additional information regarding the sensitivity of assumptions used in the rating process.

The full report providing additional analytical detail is available by clicking on the link under Related Documents below or by contacting us at info@dbrs.com.