Kroll Bond Rating Agency ("KBRA") upgrades the rating on one class and affirms the ratings on two classes of Flagship Credit Auto Trust 2012-1 ("FCAT 2012-1"), an auto loan ABS transaction, which closed on July 12, 2012. This action on the ratings reflects the fact that losses have been below KBRA's initial loss expectations to date while the credit enhancement has built for each class of notes. In addition, the FCAT 2012-1 transaction initially had higher enhancement levels as there was limited historical performance data due to the restart of the originator/servicer.

The collateral in the FCAT 2012-1 deal currently includes $67.1 million of loans, as of November 30, 2013. The collateral in the transaction has amortized from $114.7 million at closing. The action on the ratings reflect the current credit enhancement levels of 40.49% for the Class B notes, 24.25% for the Class C notes and 13.67% for the Class D notes. Credit enhancement consists of overcollateralization, subordination of junior notes, cash reserves and excess spread.

Flagship Credit Acceptance ("FCA") is an experienced originator and servicer of subprime auto loans. FCA and its predecessor, Flagship Credit Corporation have originated and serviced subprime auto loans for over 8 years. FCA is majority owned by investment funds affiliated with Perella Weinberg Partners Asset Based Value Strategy who purchased Flagship in 2010.

Class   Rating   Original Balance   Current Balance   Rating Action
B   AA-(sf)   $55,000,000   $42,232,238   Upgrade
C   A-(sf)   $10,900,000   $10,900,000   Affirm
D   BBB-(sf)   $7,100,000   $7,100,000   Affirm

Related Publications:

  • Flagship Credit Auto Trust 2012-1 New Issue Report
  • Flagship Credit Auto Trust 2012-1 17g-7 Report
  • U.S Auto Loan ABS Rating Methodology
  • Flagship Credit Auto Trust 2012-1 Surveillance Report (Published July 15, 2013)

Kroll Bond Rating Agency
Rosemary Kelley, Senior Director
rkelley@krollbondratings.com, 646-731-2337
or
William Carson, Director
wcarson@krollbondratings.com, 646-731-2405
or
Yuting Zhang, Analyst
yzhang@krollbondratings.com, 646-731-2406