Kroll upgrades CPS subprime auto bonds

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By Jennifer Kang
11 May 2020

Kroll Bond Rating Agency has upgraded three classes of notes in three CPS subprime auto ABS deals, highlighting increased level of credit enhancements. Despite a lack of obvious red flags in the sector, even as the pandemic persists, sources warn that highly levered subprime auto sponsors still face a rocky road ahead as used car values plummet.

The ratings actions affected the ‘C’ notes for CPS 2017-A and CPS 2017-B, both of which were upgraded to AAA from a previous rating of AA+. The ‘B’ notes in CPS 2018-D were also upgraded from AA+ to AAA.

Kroll decided to upgrade the transactions as a ...

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