Westar Financial Places $28.8 Million of Investment Grade Bond
5 July 2000
Firm's First European Placement
OLYMPIA, Wash. - Westar Financial Services Incorporated, the leading automobile e-finance portal, today announced it has directly sold $28.8 million of automobile lease receivable certificates primarily to a group of insurance companies. The bonds, rated by Fitch Inc. earned an `A' rating for the largest tranche of $27.8 million and BBB for the smaller tranche of $1 million. The securitization is cash positive to Westar. In a first for the company, $5 million of the bonds were placed with institutional investors in Europe."This transaction, its strong rating, pre-funding character and the European placement speak well of the quality of Westar's portfolio," said Cindy Kay, Vice President & Controller. "We're pleased with the execution afforded Westar by some of its unique tools and structure and we're delighted to expand our network of investors, partners and allies."
The investors purchased securitization certificates with a five and a half-year term backed by auto contracts from the prime-credit sector of the consumer auto lease market. The transaction included leases from all four of Westar's origination channels. The securitization is a fixed rate instrument, was created using the re-usable Carlson Trust and does not carry any third party credit enhancements. It is the Company's 21st ABS or SBAS transaction.
"A cash positive investment grade securitization is still very rare, though it has become commonplace with Westar," added Ms. Kay. "It is definitely a tribute to both the elegance of our structure as well as the comfort that investors and rating agencies have in our decisioning."
WEST is the only publicly traded automobile-oriented financial portal. Through DriveOff.com, (which recently agreed to be acquired by Microsoft, Corp.), Westar completed the first entirely electronic Internet automobile purchase and lease transaction in October 1999. The company operates its Dealer Direct leasing program in the western states and is rapidly expanding its e-finance activities nationally through alliances with DriveOff.com, AmSouth Bank and others.
Statement regarding "Forward Looking Statements": Statements concerning future performance, developments or events, including expansion of operations, growth of loan originations, quality of the company's lease portfolio, the ability to place securitizations, success of the e-commerce model, trends in interest rates, various statements concerning expectations for growth or profits and any other guidance on future periods, constitute forward-looking statements which are subject to a number of risks and uncertainties which might cause actual results to differ materially from stated expectations.