KBRA Assigns Preliminary Ratings to SFS Asset Securitization LLC, Series 2019-1

NEW YORK–(BUSINESS WIRE)–Kroll Bond Rating Agency (KBRA) assigns preliminary ratings to three classes of notes (the “Notes”) issued by SFS Asset Securitization LLC, Series 2019-1.

This transaction is the second securitization for Kapitus, formerly known as Strategic Funding Source, Inc. (“SFS” or the “Company”). The proceeds of the sale of the Series 2019-1 Notes will also be used to pay down the SFS 2018-1 transaction, purchase receivables, fund the reserve account and pay related fees and expenses. The Notes are “expandable” term notes such that at any time during the revolving period, the Issuer may periodically issue additional Notes, up to a maximum amount of $500.0 million, as long as certain conditions are met, including receipt of Rating Agency Confirmation.

Founded in 2006, Kapitus is a specialty financial services and technology company that uses its proprietary risk scoring model, transactional data, technology systems and platforms to provide capital to small and medium-sized businesses. Kapitus’ underwriting approach relies on multiple data sources and metrics related to a business owner that the Company believes to be predictive of the business owner’s credit performance.

The transaction features a revolving period, which will end on the earlier of (i) November 30, 2022, approximately 36 months after the closing date and (ii) the date on which a rapid amortization event has occurred that is not later cured or waived. Credit enhancement will consist of overcollateralization, subordination (in the case of the Class A and Class B Notes), excess spread, an excess funding account, a capitalized interest account, and a reserve account, which will initially be funded in an amount equal to 0.50% of the aggregate balance of the Series 2019-1 Notes divided by 95.00%.

To access ratings, reports and disclosures, click here.

Notes

Preliminary Rating

 

Initial Principal Balance

Class A

A (sf)

 

$130,526,000

Class B

BBB- (sf)

 

$21,210,000

Class C

BB+ (sf)

 

$3,264,000

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About KBRA and KBRA Europe

KBRA is a full-service credit rating agency registered with the U.S. Securities and Exchange Commission as an NRSRO. In addition, KBRA is designated as a designated rating organization by the Ontario Securities Commission for issuers of asset-backed securities to file a short form prospectus or shelf prospectus. KBRA is also recognized by the National Association of Insurance Commissioners as a Credit Rating Provider, and is a certified Credit Rating Agency (CRA) by the European Securities and Markets Authority (ESMA). Kroll Bond Rating Agency Europe Limited is registered with ESMA as a CRA.

Contacts

Analytical Contacts:

Chris Baffa, Associate Director

(646) 731-3312

cbaffa@kbra.com

Pritam Patel, Associate

(646) 731-3374

ppatel@kbra.com

Eric Neglia, Managing Director

(646) 731-2456

eneglia@kbra.com

Sandy Azer, Associate Director

(646) 731-1200

sazer@kbra.com

Business Development Contact:

Ted Burbage, Managing Director

(646) 731-3325

tburbage@kbra.com

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