Mercedes introduces YSOC to China auto ABS

Daimler 230px
By Rev Hui
15 Mar 2016

Mercedes-Benz Auto Finance is set to bring a landmark transaction to China next week with its inaugural Auto ABS, Silver Arrow China 2016-1. The Rmb2.5bn ($385m) is not only notable for being Mercedes’ first ABS outing in China, but is also the first in the country to spot a yield supplement over-collateralization (YSOC) feature.

YSOC is a form of credit enhancement that is usually seen in auto ABS when a portion of the underlying loans carrylow interest rates. The money set aside in ...

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