Link to Fitch Ratings' Report: Ford Credit Auto Owner Trust 2015-REV1 (US ABS)
http://www.fitchratings.com/creditdesk/reports/report_frame.cfm?rpt_id=850968
Fitch Ratings assigns the following ratings and Outlooks to the notes issued by Ford Credit Auto Owner Trust 2015-REV1:
--$1,500,000,000 class A 'AAAsf'; Outlook Stable;
--$60,811,000 class B 'AAsf'; Outlook Stable;
--$60,811,000 class C 'Asf'; Outlook Stable.
KEY RATING DRIVERS
Strong Initial Credit Quality: The initial 2015-REV1 pool is consistent with 2014-REV2 and prior FCAOT deals, with a weighted average (WA) Fair Isaac Corp. (FICO) score of 731. The pool is geographically diverse with approximately nine months of seasoning, while 44.3% of the pool consists of loans with terms of more than 60 months. However, as the transaction will incorporate a five-year revolving period, focus was placed on future receivables eligibility parameters.
Restrictive Pool Composition Requirements: The 2015-REV1 pool includes strict criteria for new receivables eligibility, mitigating potential pool deterioration during the revolving period. Fitch's base case credit loss proxies of 2.30% (floor credit enhancement composition test) and 2.75% (pool composition test) reflect the worst, potential pool composition under these two sets of criteria.
Adequate CE Structure: Initial hard credit enhancement (CE) for class A, B and C notes totals 9.50%, 5.75% and 2%, respectively (unchanged from 2014-REV2). Loss coverage provided by the structure under each of the floor CE composition and pool composition test scenarios is adequate to support loss multiples consistent with the expected ratings.
Stable Portfolio/Securitization Performance: Delinquencies and losses on Ford Credit's portfolio and 2009-2014 securitizations have performed well, supported by the improving U.S. economy and stable used vehicle values.
Positive Corporate Performance: Fitch currently has a long-term Issuer Default Rating (IDR) of 'BBB-' and Positive Rating Outlook on Ford Motor Company (Ford), the parent of Ford Credit (rated 'BBB-' with a Positive Outlook).
Consistent Origination/Underwriting/Servicing: Ford Credit demonstrates adequate abilities as originator, underwriter and servicer, as evidenced by historical performance. Furthermore, the historical stability of Ford's origination profile and investment-grade financial health provides mitigants to the long-term nature of the 2015-REV1 revolving period.
RATING SENSITIVITIES
Unanticipated increases in the frequency of defaults and loss severity on defaulted receivables could produce loss levels higher than the base case. This could result in potential rating actions on the notes. Fitch evaluated the sensitivity of the ratings assigned to all classes of Ford Credit Auto Owner Trust 2015-REV1 to increased losses over the life of the transaction. Fitch's analysis found that the class B, and C notes display some sensitivity to increased defaults and losses, showing potential downgrades of up to one category under Fitch's moderate (1.5x base case loss) scenario. All classes of notes could experience downgrades of up to two rating categories under Fitch's severe (2.5x base case loss) scenario.
Key Rating Drivers and Rating Sensitivities are further detailed in the accompanying presale report, available at 'www.fitchratings.com' or by clicking on the above link.
Additional information is available at 'www.fitchratings.com'.,
Applicable Criteria and Related Research:
--'Global Structured Finance Rating Criteria' (August 2014);
--'Rating Criteria for U.S. Auto Loan ABS' (April 2014);
--'Structured Finance Tranche Thickness Metrics' (July 2011);
--'Ford Credit Auto Owner Trust 2015-REV1 -- Appendix' (January 2015).
Applicable Criteria and Related Research:
Global Structured Finance Rating Criteria
http://www.fitchratings.com/creditdesk/reports/report_frame.cfm?rpt_id=754389
Rating Criteria for U.S. Auto Loan ABS
http://www.fitchratings.com/creditdesk/reports/report_frame.cfm?rpt_id=738718
Structured Finance Tranche Thickness Metrics
http://www.fitchratings.com/creditdesk/reports/report_frame.cfm?rpt_id=646951
Ford Credit Auto Owner Trust 2015-REV1 -- Appendix
http://www.fitchratings.com/creditdesk/reports/report_frame.cfm?rpt_id=851928
Additional Disclosure
Solicitation Status
http://www.fitchratings.com/gws/en/disclosure/solicitation?pr_id=974615
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