CPS Announces $327.5 Million Securitization and Renewal of Credit Facility.IRVINE, Calif. -- Consumer Portfolio Services, Inc. (Nasdaq:CPSS CPSS Committee on Payment and Settlement Systems CPSS Commission on Public Secondary Schools CPSS Cincinnati Prehospital Stroke Scale (STR - Smile, Talk, Raise both arms) CPSS Certified Professional Soil Scientist ) ("CPS (1) (Characters Per Second) The measurement of the speed of a serial printer or the speed of a data transfer between hardware devices or over a communications channel. CPS is equivalent to bytes per second. " or the "Company") announced that it closed a term 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 today, issuing $294.750 million of investment grade notes backed by automotive receivables. The Company also announced that it has renewed one of its $200 million revolving warehouse credit facilities credit facilities npl → facilidades fpl de crédito credit facilities npl → facilités fpl de paiement credit facilities . The renewed facility now extends through September 30, 2008. In the term transaction, qualified institutional buyers In law, a Qualified Institutional Buyer is a purchaser of securities that is financially sophisticated and is legally recognized by security market regulators to need less protection from sellers than most members of the public. purchased $294,750,000 of notes backed by automotive receivables purchased by CPS. The notes, issued by CPS Auto Receivables Trust 2007-C, consist of four classes. The ratings of the notes were provided by Standard & Poor's and Moody's Investors Services Moody's Investors Service A leading global credit rating, research and risk analysis firm. Moody's Investors Service A leading firm engaged in credit rating, risk analysis, and research of fixed-income securities and their issuers. and were based on the structure of the transaction, CPS's experience as a servicer and a financial guaranty As a verb, to agree to be responsible for the payment of another's debt or the performance of another's duty, liability, or obligation if that person does not perform as he or she is legally obligated to do; to assume the responsibility of a guarantor; to warrant. insurance policy issued by Financial Security Assurance Inc. [TABLE OMITTED] The weighted average effective coupon on the notes is approximately 5.69%. The 2007-C transaction has initial 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 of 12.00% consisting of a cash deposit in the amount of 2.00% of the original receivable pool balance, plus subordinated interests of 10.00%. That enhancement level is to be supplemented by accelerated payment of principal on the notes to reach a combined level of 16.75% of the then-outstanding receivable pool balance. These levels represent a decrease of 50 and 100 basis points, respectively, from the Company's last regular quarterly term securitization, CPS Auto Receivables Trust 2007-B, in June 2007. The transaction utilized a pre-funding structure, in which CPS sold approximately $230.9 million of receivables today and plans to sell approximately $96.6 million of additional receivables during October 2007. This further sale is intended to provide CPS with financing for receivables originated primarily in the month of September. "We are pleased with the execution of our most recent securitization and the renewal of one of our credit lines amid the lingering effects of the recent credit squeeze credit squeeze Restricted bank lending that is accompanied by rising short-term interest rates and a decline in economic growth. Credit squeezes are generally attributed to policy actions of the Federal Reserve. ," said Charles E. Bradley, Jr., Chairman and Chief Executive Officer of CPS. "Our consistent portfolio performance has resulted in lower credit enhancement levels and continued access to the capital markets despite ongoing market volatility. While the credit spreads required by investors widened from our last term deal in June, much of this increase was offset by lower yields in the Treasury market. The resulting blended cost was only slightly higher than the June transaction." The transaction was a private offering of securities, not registered under the Securities Act of 1933, or any state securities law. All of such securities having been sold, this announcement of their sale appears as a matter of record only. About Consumer Portfolio Services, Inc. Consumer Portfolio Services, Inc. is a specialty finance company engaged in purchasing and servicing new and used retail automobile contracts originated primarily by franchised automobile dealerships and to a lesser extent by select independent dealers of used automobiles in the United States United States, officially United States of America, republic (2005 est. pop. 295,734,000), 3,539,227 sq mi (9,166,598 sq km), North America. The United States is the world's third largest country in population and the fourth largest country in area. . We serve as an alternative source of financing for dealers, facilitating sales to sub-prime customers, who have limited credit history, low income or past credit problems and who otherwise might not be able to obtain financing from traditional sources. |
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