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 CHICAGO, Nov. 22 /PRNewswire/ -- Duff & Phelps Credit Rating Co. has assigned a rating of "Duff 1+" (one-plus) to the $400 million Class A-1 variable-rate certificates and a rating of "AAA" (Triple-A) to the $100 million Class A-2 variable-rate certificates issued by the CARCO Auto Loan Master Trust. The certificates are backed by receivables generated from a master pool of wholesale automobile dealer lines of credit (floorplan accounts) originated by Chrysler Credit Corporation ("CCC" or the servicer) and sold to U.S. Auto Receivables Company (the seller or "USA").
 The Class A-1 certificates are money-market extendible and pay interest only for one month. At that time, the interest only/revolving period is automatically extended for another month unless Class A-1 investors have elected not to extend. Bear, Stearns & Co., as the remarketing broker-dealer, would have the right (but not the obligation) to remarket the non-extended Class A-1 certificates. If Bear Stearns chooses not to remarket, then Class A-1 principal amortizes monthly until the certificates are paid in full.
 Class A-1 investors receive a certificate rate equal to the 30-day commercial paper rate plus 0.75 percent while the Class A-2 investors receive one-month LIBOR plus 0.26 percent. However, if the certificate rate should ever exceed the underlying interest earned by the receivables, then investors would only receive the available receivables rate.
 The overall revolving period for the 1993-2 Series (including Class A-1) is expected to last anywhere from 54 to 59 months, as determined by the servicer (CCC). If, in any month, additional receivables are not available for sale, then principal collections are held in an "excess funding account" until CCC has generated enough new receivables. After the revolving period, principal collections are placed into a separate trust account to fund payments of investor principal. Full repayment of principal is expected to be on November 15, 1998, but may be earlier depending on the selected length of the revolving period or the occurrence of an early amortization event.
 Initially, only approximately $234.5 million of receivables are funded from the issuance. CCC anticipates that within four months the balance of the proceeds will be used to purchase newly generated receivables. Any potential negative carry on the certificates during that time is borne by the certificateholders. Although the 1993-2 Series provides for a yield supplement account (YSA) to support any potential investor interest shortfalls, D&P's rating of the certificates does not address the likelihood that any interest shortfalls may occur nor the ability of the YSA to sufficiently cover any such shortfall.
 Payments to investors are primarily supported by subordination of a portion of the seller's interest in the master trust and is equal equal to 12 percent. In addition, there is a reserve fund equal to 0.55 percent of the outstanding certificate balance. Any draws on the subordinated amount or the reserve fund are replenished with any excess receivables cash flow that otherwise would go to the seller. If the Series 1993-2 certificates are not repaid in full, then principal collections will flow through each month until full repayment occurs or up to the 1993-2 termination date in January 2000.
 The ratings on the certificates is based on an analysis of the characteristics of CCC's entire U.S. wholesale portfolio of floorplan accounts, the historical loss experience of CCC, a stress analysis of projected cash flows, the legal structure of the transaction, and the origination and servicing policies of CCC.
 In order to qualify for a "Duff 1+" rating, the Class A-1 certificates are intended to amortize out within any 12-month period. The liquidity available to ensure this payout period is provided by the inherent liquidity of the receivables and the available subordinated and reserve fund amounts. The sizing of the Class A-1 certificate amount was accomplished through an analysis of expected cash flows under a worst-case stress for payment rates, losses and portfolio yield.
 The "Duff 1+" rating of the Class A-1 and "AAA" rating of the Class A-2 certificates reflects credit enhancements in the form of 12 percent subordination and a 0.55 percent reserve fund. In addition, during any early amortization, the subordinated amount is frozen thereby causing subordination to increase as a percentage of remaining certificate principal. Also, although not considered in the cash flow analysis, certificate holders do have the benefit of any excess receivables cash flow from the difference between the certificate rates and the finance rate on the receivables (Prime + 50bp to 200bp). D&P believes the credit enhancement provides for the highest credit quality and protection of timely payment of interest and the ultimate full repayment of principal by the 1993-2 termination date.
 -0- 11/22/93
 /CONTACT: Andrew Leszczynski of Duff & Phelps, 312-368-3177/

CO: Duff & Phelps Rating Co.; CARCO Auto Loan Master Trust ST: IN: FIN SU: RTG

LG -- NY075 -- 6895 11/22/93 15:14 EST
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Publication:PR Newswire
Date:Nov 22, 1993

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