Printer Friendly

UFSB 1993-B AUTO TRUST RATED 'AAA' BY FITCH -- FITCH FINANCIAL WIRE --

 NEW YORK, Sept. 30 /PRNewswire/ -- UFSB 1993-B Auto Trust's $212.7 million 4.45 percent automobile receivable pass-through certificates class A are rated "AAA" by Fitch. The interest-only class I certificates also are rated "AAA." The ratings are based on the characteristics of the retail auto receivables, credit enhancement levels, and strong servicing capabilities of Union Federal Savings Bank of Indianapolis (UFSB). The rating also reflects the sound financial and legal structures.
 Union Federal Savings Bank of Indianapolis, a wholly owned subsidiary of Union Holding Co. (UHC), is a federally chartered stock savings bank operating through offices in Indiana and Ohio.
 The receivables consist of simple interest retail installment sales contracts secured by new and used automobiles, light duty trucks, and vans originated by UFSB. Almost 64 percent of the pool is comprised of used vehicles. While a high concentration of used vehicles could expose the pool to a large number of repossessions, this risk is offset by UFSB's emphasis on borrower credit quality and capacity to repay. The implementation of a credit score model in 1989 has enabled UFSB to maintain a stronger borrower profile as demonstrated by lower delinquencies and losses.
 Loan seasoning is approximately two months. Therefore, the borrower's willingness and ability to repay is not yet established. However, this risk is more than offset by the credit enhancement level, monthly excess cash, and UFSB's underwriting standards emphasizing credit quality. Geographic locations range from the Midwest to southern and mountain states. UFSB performs a thorough analysis of a region before entering a new market and, thereafter, monitors the regional scorecards to ensure performance is as expected and makes adjustments as necessary. The pool's state concentrations include Texas (24.7 percent), Oklahoma (16.3 percent), Arizona (14.5 percent), Ohio (12.9 percent), and Indiana (8.4 percent).
 Credit enhancement for class A and class I certificates will consist of an initial cash deposit of 1 percent of the original pool balance in a cash collateral account and an 11 percent letter of credit provided by State Street Bank for a total "AAA" credit enhancement level of 12 percent. In addition, excess cash of approximately 400 bps will be available on a monthly basis to cover losses and delinquencies. Any remaining excess cash will be deposited in the cash collateral account and a corresponding decrease will be made to the letter of credit. The required level of credit enhancement will always at least equal 12 percent of the pool balance. Considering UFSB's improved portfolio performance and its previous securitizations, Fitch believes that the certificateholders are sufficiently protected by the level of credit enhancement.
 The legal structure provides assurance that in the event of a UFSB insolvency, the certificateholders should remain insulated. Thus, the likelihood of a disruption in payments to the certificateholders is remote.
 UFSB will act as servicer for the transaction. The bank's strong servicing capabilities are demonstrated by the improved level of delinquencies and losses on its portfolio, as well as its highly automated operations and experienced management. Fitch believes UFSB will maintain asset quality due to the expertise of its staff and the policies and procedures in place.
 -0- 9/30/93
 /CONTACT: Rita Duggan, 212-908-0628 or Suzanne Mistretta, 212-908-0637, of Fitch/


CO: Union Federal Savings Bank; Union Holding Co. ST: Indiana IN: FIN SU: RTG

LG -- NY067 -- 7319 09/30/93 13:20 EDT
COPYRIGHT 1993 PR Newswire Association LLC
No portion of this article can be reproduced without the express written permission from the copyright holder.
Copyright 1993 Gale, Cengage Learning. All rights reserved.

Article Details
Printer friendly Cite/link Email Feedback
Publication:PR Newswire
Date:Sep 30, 1993
Words:560
Previous Article:CABLEVISION CONCLUDES RETRANSMISSION AGREEMENT WITH ABC; CABLEVISION CALLS ON HOLDOUT BROADCASTERS TO CONCLUDE SIMILAR NEGOTIATIONS
Next Article:CARBOMEDICS HEART VALVE APPROVED FOR SALE IN THE UNITED STATES
Topics:

Terms of use | Copyright © 2016 Farlex, Inc. | Feedback | For webmasters