DBRS Discontinues the Rating of Purchasing Power Funding 2017-A, LLC and Removes from Under Review – Developing and Confirms the Ratings of Purchasing Power Funding 2018-A, LLC

DBRS, Inc. (DBRS) discontinued the rating of A (sf) on the Class A Loans issued by Purchasing Power Funding 2017-A, LLC (PPF 2017-A) due to repayment in full. DBRS also removed from Under Review with Developing Implications the four publicly rated securities issued by Purchasing Power Funding 2018-A, LLC (PPF 2018-A; together, with PPF 2017-A, the Transactions), where they were placed on July 2, 2018. The four securities include Class A, Series 2018-A; Class B, Series 2018-A; Class C, Series 2018-A; and Class D, Series 2018-A. Subsequently, DBRS confirmed the ratings of the same four classes of the PPF 2018-A transaction as follows: Class A, Series 2018-A at AA (sf); Class B, Series 2018-A at A (high) (sf); Class C, Series 2018-A at BBB (sf); and Class D, Series 2018-A at BB (low) (sf).

These rating actions follow the notification on June 25, 2018, by Purchasing Power, LLC (the Company) of certain historical inaccuracies relating to the reporting of deemed collections on certain of the receivables due to returned merchandise, as well as certain other errors in reporting the balances of certain of the receivables of the Transactions (the Reporting Inaccuracies). The notification stated that as of June 22, 2018, no borrowing base deficit existed in PPF 2017-A and the overcollateralization test was in compliance for PPF 2018-A.

On July 10, 2018, as a result of the discovery of the Reporting Inaccuracies, PPF 2018-A requested a waiver from noteholders of any servicer defaults, seller events of default or any other event that may have occurred that would have caused a rapid amortization event. On July 12, 2018, PPF 2018-A received consent from the required noteholders to enter into such a waiver.

Concluding discussions with the Company and the review of corrected and restated remittance reports and third-party due diligence reports for the Transactions, DBRS determined that no servicer defaults, seller events of default or any other event occurred that would have caused a rapid amortization event.

Notes:
The principal methodology is the DBRS Master U.S. ABS Surveillance Methodology, which can be found on dbrs.com under Methodologies.

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

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.

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