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Silver Arrow S.A. Compartment UK 2017-1: 04 October 2017

A standalone issue, which will be the first public securitisation of UK assets from Mercedes-Benz Financial Services.

The Issuer will make payments on the notes from payments of principal and interest it receives from borrowers pursuant to automotive hire purchase agreements and personal contract plan agreements originated by Mercedes-Benz Financial Services UK Limited which will be purchased by the issuer on the purchase date (being identical with the issue date). These hire purchase agreements and personal contract plan agreements provide for equal monthly payments over the term of the contract or monthly payments and a final bullet payment or, in respect of the personal contract plan agreements, an additional larger optional "balloon" Optional Final Payment at the end of the term.

Eligibility criteria (includes): such Receivable has been originated by the Seller pursuant to a Financing Contract in the ordinary course of the Seller's business in compliance with the Credit and Collection Policy; the obligor is not Insolvent; pays its monthly instalments through Direct Debit; if it is a corporate entity has its registered office in England, Scotland, Wales or Northern Ireland or, if it is an individual has its place of residence in England, Scotland, Wales or Northern Ireland; has made at least one scheduled monthly payment; is denominated and payable in Sterling; is governed by the laws of England and Wales; MBFS holds legal title to the related Vehicle.

The portfolio consists of 28,875 agreements, where the average current outstanding balance is £18,905 and the largest is £113,826. Product type (by agreement/current balances): New Contract Purchase 16,122 / 68.29%; Used Contract Purchase 7,058 / 21.67%, Used Hire Purchase 3,286 / 5.28% and New Hire Purchase 2,409 / 4.76%. Vehicle status: New Passenger Car 16,445 / 67.99%, Used Passenger Car 9,478 / 25.52%, New Commercial Vehicle 2,076 / 5.06% and Used Commercial Vehicle 866 / 1.42%. Customer type: Private Individual 25,240 / 90.60%, Company 2,900 / 7.47%, Sole trader 586 / 1.45%, Partnership 149 / 0.48%. The WA seasoning is 15.51 months. Regional distribution: London 17.97%, South East England 13.17%, North West England 12.66% and the East of England 10.57%.

CRR 405: The Seller as "originator" for the purposes of Article 405(1) of the CRR will retain for the life of the transaction a material net economic interest of not less than 5% in accordance with Article 405 of Regulation (EU) No 575/2013 of the European Parliament, Article 17 of Directive (EU) No 2011/61 and Article 254 of Regulation (EU) 2015/35. As of the Issue Date, such interest will be comprised of an investment in the Class B Notes and the granting of the Subordinated Loan, which is together equivalent to no less than 5% of the nominal amount of the securitised exposures.

U.S. Risk Retention Rules: The issuance of the Notes has not been designed to comply with the U.S. Risk Retention Rules other than the exemption under Section _.20 of the U.S. Risk Retention Rules and no other steps have been taken by the Issuer, the Seller, the Arranger, the Joint Lead Managers, the Joint Bookrunners, the Managers or any of their respective affiliates or any other party to accomplish such compliance.

Volcker Rule: The Issuer is structured not to be a "covered fund" under the regulations adopted to implement section 619 of the Dodd-Frank Wall Street Reform and Consumer Protection Act, commonly known as the "Volcker Rule". In making this determination, the Issuer is relying on the "loan securitization exclusion" under sub-section 10(c)(8) of the Volcker Rule, although other exclusions or exemptions may also be available to the Issuer.

Compare/contrast: Silver Arrow S.A. Compartment 8, Driver UK (Series Six), Globaldrive Auto Receivables UK 2017-A