AT&T UNIT SECURITIZES $1 BILLION OF CREDIT CARD RECEIVABLES.NEW YORK--(BUSINESS WIRE)--August 23, 1995--AT&T Universal Card Services The software support for PC Cards. PC Card applications talk to Card Services. See PC Card. Corp. (UCS (Universal Character Set) An ISO/IEC format for coding character sets. ISO/IEC 10646 was synchronized with Unicode; however, Unicode adds additional constraints, and compliance with 10646 does not guarantee compatibility with Unicode. See Unicode. ) which markets a consumer credit card, today announced that it has priced a $1 billion credit card securitization Securitization The process of creating a financial instrument by combining other financial assets and then marketing them to investors. Notes: Mortgage backed securities are a perfect example of securitization. May also be spelled as "securitisation. transaction. The securitization, Series 1995-1, consists of two classes of publicly traded floating rate certificates which will be issued by AT&T Universal Card Master Trust. The senior class, Class A, represents $870 million in receivables. The three-year Class A certificates will accrue interest at 8 basis points over the three-month London Interbank Offered Rate London Interbank Offered Rate A short-term interest rate often quoted as a 1,3,6-month rate for U.S.dollars. (LIBOR LIBOR See: London Interbank Offered Rate LIBOR See London interbank offered rate (LIBOR). ), and were priced at par. The $60 million in subordinated three-year Class B Certificates were also priced at par and will accrue interest at three-month LIBOR plus 20 basis points. The initial interest rate on both the Class A and Class B certificates will be set on August 29, 1995 and will reset quarterly. Series 1995-1 also includes a privately-funded $70 million collateral invested amount, which will be subordinated to the Class A and Class B certificates and will provide credit enhancement Credit Enhancement A method whereby a company attempts to improve its debt or credit worthiness. Notes: Credit enhancements take many different forms. An example of a credit enhancement would be conversion rights added on to a debt instrument in order to lower the issuing for the benefit of certificate-holders. The transaction was negotiated by an underwriting group led by Merrill Lynch & Co. with CS First Boston and Salomon Brothers Inc as co-managers. The Class A Certificates are expected to be rated "AAA AAA: see American Automobile Association. (Triple A) A common single-cell battery used in a myriad of electronic devices of all variety. Like its double A (AA) cousin, it provides 1.5 volts of DC power. When used in series, the voltage is multiplied. " by Standard & Poor's and Fitch, and "Aaa" by Moody's; the Class B Certificates are expected to be rated "A" by Standard & Poor's and Fitch, and "A2" by Moody's. AT&T UCS will retain the servicing and customer relationships of the credit card accounts. UCS currently has 16.4 million accounts and 23 million cards issued. It has $12.5 billion in outstanding receivables. This notice does not constitute an offering to sell securities, which can be made only by means of a prospectus. CONTACT: Eileen M. Connolly 908-221-6731 (office) 914-361-4615 (home) or Mitch Montagna 904-954-8896 (office) 904-241-6589 (home) |
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