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      THURSDAY, 13/10/2022 - Scope Ratings GmbH
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      Scope has completed a monitoring review of Red & Black Auto Germany 6 UG - German Auto ABS

      No action has been taken following the monitoring review.

      Scope Ratings GmbH (Scope) monitors and reviews its credit ratings on an ongoing basis and at least annually, or every six months in the case of sovereigns, sub-sovereigns and supranational organisations.

      Scope performs monitoring reviews to determine whether material changes and/or changes in macroeconomic or financial market conditions could have an impact on the credit ratings. Scope considers all available and relevant information when undertaking the monitoring review.

      Monitoring reviews are conducted by performing a peer comparison, benchmarking against the rating-change drivers, and/or reviewing the credit ratings’ performance over time, as deemed appropriate by the Lead Analyst or Analytical Team Head, in addition to an assessment of all aspects of the relevant methodology/ies, including key rating assumptions and model(s). Scope publicly announces the completion of each monitoring review on its website. 

      Scope completed a monitoring review of the following notes issued by Red & Black Auto Germany 6 UG on 11 October 2022 and considered the investor reporting up to August 2022 payment date. The credit ratings remain as follows:

      Class A: EUR 243.2m outstanding amount: AAASF

      Class B: EUR 17.5m outstanding amount: AA+SF

      Class C: EUR 6.5m outstanding amount: A-SF

      Class D: EUR 4.4m outstanding amount: BBB-SF

      Red & Black Auto Germany 6 UG is the sixth auto ABS transaction of Bank Deutsches Kraftfahrzeuggewerbe GmbH (BDK). The transaction is a static cash securitisation of German auto loans, originated and serviced by BDK. The current portfolio (EUR 276.6m versus EUR 1,000.0m at closing) is comprised of private clients (90.1%) and commercial clients (9.90%) based in Germany, who used the loans to acquire new (20.8%), newly used (44.01%) and used (35.19%) vehicles. The notes amortisation has recently switched to pro-rata from sequential, as the following conditions have been met: the class A credit enhancement has exceeded 11% and the net loss ratio remains below 1.1%. Amortisation may revert to sequential if such conditions, among other performance triggers, ceased to be met.

      The review was conducted considering available investor reports up to the August 2022 payment date. This monitoring note does not constitute a credit rating action, nor does it indicate the likelihood that Scope will conduct a credit rating action in the short term. Information about the latest credit rating action connected with this monitoring note along with the associated rating history can be found on www.scoperatings.com.

      Key rating factors

      The ratings are supported by the positive portfolio performance and by the transaction´s structural features. The notes have amortised to 27.7% of their initial balance. The level of cumulative defaults is low at 0.63% of initial pool balance, with a cumulative recovery rate of 72.7%. The current levels of credit enhancement (excluding the reserve fund) stand at 12.1%, 5.8%, 3.4% and 1.8%, for classes A to D, respectively. The reserve fund remains fully funded and the level of excess spread (including stressing of fees applied by Scope) has been stable at around 1.4% since closing.

      The methodologies applicable for the reviewed ratings (General Structured Finance Rating Methodology, 17 December 2021; Consumer and Auto ABS Rating Methodology, 3 March 2022; Counterparty Risk Methodology, 14 July 2022) are available on https://scoperatings.com/governance-and-policies/rating-governance/methodologies
      This monitoring note is issued by Scope Ratings GmbH, Lennéstraße 5, D-10785 Berlin, Tel +49 30 27891-0.
      Lead analyst: Elom Kwamin, Specialist

      Potential conflicts
      See www.scoperatings.com under Governance & Policies/EU Regulation/Disclosures for a list of potential conflicts of interest related to the issuance of Credit Ratings. A member of the Board of Trustees of Scope Foundation has a significant relationship with Société Generale SA, a related third party to this transaction. The Scope Foundation is a 20% shareholder of Scope Management SE, the general manager of Scope SE & Co KGaA (“Scope Group”). Scope Foundation has no financial or economic interest in Scope SE & Co KGaA and the main function of the foundation is to preserve the European identity of the shareholder structure of Scope Group.

      © 2022 Scope SE & Co. KGaA and all its subsidiaries including Scope Ratings GmbH, Scope Ratings UK Limited, Scope Analysis GmbH, Scope Investor Services GmbH, and Scope ESG Analysis GmbH (collectively, Scope). All rights reserved. The information and data supporting Scope’s ratings, rating reports, rating opinions and related research and credit opinions originate from sources Scope considers to be reliable and accurate. Scope does not, however, independently verify the reliability and accuracy of the information and data. Scope’s ratings, rating reports, rating opinions, or related research and credit opinions are provided ‘as is’ without any representation or warranty of any kind. In no circumstance shall Scope or its directors, officers, employees and other representatives be liable to any party for any direct, indirect, incidental or other damages, expenses of any kind, or losses arising from any use of Scope’s ratings, rating reports, rating opinions, related research or credit opinions. Ratings and other related credit opinions issued by Scope are, and have to be viewed by any party as, opinions on relative credit risk and not a statement of fact or recommendation to purchase, hold or sell securities. Past performance does not necessarily predict future results. Any report issued by Scope is not a prospectus or similar document related to a debt security or issuing entity. Scope issues credit ratings and related research and opinions with the understanding and expectation that parties using them will assess independently the suitability of each security for investment or transaction purposes. Scope’s credit ratings address relative credit risk, they do not address other risks such as market, liquidity, legal, or volatility. The information and data included herein is protected by copyright and other laws. To reproduce, transmit, transfer, disseminate, translate, resell, or store for subsequent use for any such purpose the information and data contained herein, contact Scope Ratings GmbH at Lennéstraße 5 D-10785 Berlin. 

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