DCR Assigns Ratings to Premier Auto Trust 1999-2
29 April 1999
DCR Assigns Ratings to Premier Auto Trust 1999-2
NEW YORK, April 28 -- Duff & Phelps Credit Rating Co. (DCR)
has assigned the following preliminary ratings to the notes issued by
Premier Auto Trust 1999-2:
Security Preliminary Rating Amt Final Maturity
4.94 percent
Class A-1 Notes D-1+ (D-One-Plus) $330,000,000 January 28, 2000
5.28 percent
Class A-2 Notes AAA (Triple-A) $490,000,000 November 8, 2001
5.49 percent
Class A-3 Notes AAA (Triple-A) $520,000,000 February 10, 2003
5.59 percent
Class A-4 Notes AAA (Triple-A) $344,369,000 February 9, 2004
Class B
Certificates N/R $65,625,000 August 8, 2005
Chrysler Financial Company L.L.C. (CFC) is the seller and servicer for the
transaction and the lead underwriter is Salomon Smith Barney.
The ratings on the notes are based on credit enhancement in the form of
overcollateralization, subordination of the Class B Certificates, and a
reserve account supporting Class A Notes; full turbo structure which uses
excess spread to fast pay the notes, creating further overcollateralization;
CFC's considerable experience in servicing the receivables; and the strong
legal structure of the transaction.
DCR's ratings on the Premier Auto Trust 1999-2 notes are comparable to
those on the previous CFC transactions. Credit enhancement levels are
identical to that of Series 1999-1. The Class B certificates (retained by
CFC) do not bear interest and principal distributions until all of the Class A
notes are paid in full. This feature offers more protection for the Class A
notes by making available all monthly collections to the Class A notes until
the Class A notes are paid in full. The only significant difference in the
current transaction is that the Class A-1 notes will make two distributions in
January 2000, on the 8th and the 28th if necessary, in order to meet the
scheduled final maturity date.
Full turbo structure of the transaction uses excess spread to sequentially
fast-pay the notes, creating further overcollateralization until it reaches at
least 4.50 percent of the current pool balance.
Credit enhancement for the Class A notes is provided by subordination,
overcollateralization, and a reserve account. The Class A notes depend on the
approximately 3.75 percent subordination of the Class B certificates. In
addition, overcollateralization, initially 4.00 percent of the initial
security balance (approximately $70 million) will grow as the notes are
turboed. The overcollateralization for this transaction is the same as in
Premier Auto Trust 1999-1. So long as excess spread is maintained, credit
enhancement in the form of overcollateralization will grow throughout the life
of the transaction. Furthermore, a cash reserve account with an initial
deposit of approximately $4.4 million will be available to cover losses
The credit enhancement in the form of a cash reserve account,
approximately $4,375,000 (0.25 percent of the initial security balance), is
the same as the cash reserve account in Premier Auto Trust 1999-1, 1998-5 and
1998-4. The cash must be maintained at 0.25 percent of the initial security
balance throughout the life of the transaction. The smaller cash reserve, as
compared to pre 1998-4 transactions, reflects the reduced liquidity needs of
the subordinate Class B certificates since that class is being retained.
Duff & Phelps Credit Rating Co. (DCR) is a leading global rating agency
with 32 local market offices providing ratings and research on debt issues and
insurance claims paying ability in more than 50 countries. For additional
research on Premier Auto Trust 1999-2, visit DCR's web site at
http://www.dcrco.com (Quick Search: Premier). DCR's research is also
available on Bloomberg at DCR and First Call's BondCall Direct/Research
Direct at http://www.firstcall.com , as well as through other third-party
providers.
For a copy of the New Financing Report Summary on this transaction, please
call the DCR Hotline at 312-368-3198 or e-mail hotline@dcrco.com.