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Consumer Portfolio Services Inc. announced the closing of its fourth term securitization in 2012. The transaction is CPS's seventh senior subordinate securitization since 2011.
In the transaction, qualified institutional buyers purchased $160 million of asset-backed notes secured by automobile receivables purchased by CPS. The sold notes, issued by CPS Auto Receivables Trust 2012-D, consist of five classes. Ratings of the notes were provided by Standard & Poor's and Moody's and were based on the structure of the transaction, the historical performance of similar receivables and CPS's experience as a servicer.
The weighted average effective coupon on the notes is approximately 2.06 percent.
The 2012-D transaction has initial credit enhancement consisting of a cash deposit equal to 1 percent of the original receivable pool balance. The final enhancement level requires accelerated payment of principal on the notes to reach overcollateralization of 11.50 percent of the then-outstanding receivable pool balance.
The transaction utilizes a pre-funding structure, in which CPS sold approximately $115.0 million of receivables today and plans to sell approximately $45 million of additional receivables during January 2013. This further sale is intended to provide CPS with long-term financing for receivables purchased primarily in the month of December. The transaction also included $10.7 million of receivables originally originated by CPS in 2007 that were recently repurchased from a securitization transaction, which closed in 2007.
The transaction was a private offering of securities.