August 17, 2015
CRISIL reaffirms ratings on the pass through certificates (PTCs) and resets credit collateral under the securitisation transaction backed by commercial vehicle and passenger vehicle loan receivables originated by Shriram Transport Finance Company Limited
|Outstanding Amount Rated (Rs. Mn)||Original Tenure# (Months)||Balance Tenure# (Months)||Rating/ Credit Opinion||Credit support pre reset |
(Rs. Mn )
|Credit support post reset|
Sansar Trust Sep 2013 –II||Series A PTCs||6,003.2
34||CRISIL AAA (SO) [Reaffirmed]||703.0||496.2$||Second Loss Facility||402.8||284.3@
||CRISIL BBB (SO) Equivalent [Reaffirmed]||300.2||211.9|
*As of June 2015 payouts
#Indicates door-to-door tenure; actual tenure will depend on the level of prepayments in the pool and the extent of shortfalls
$Additionally, scheduled excess interest spread (EIS) amounting to Rs.110.6 million (assuming zero prepayments) also provides credit support to PTCs
@Post reset, the second loss facility stands at Rs. 284.3 million
CRISIL has reaffirmed its rating on Series A pass-through certificates (PTCs) issued under the transaction ‘Sansar Trust Sep 2013 –II’ at ‘CRISIL AAA (SO). CRISIL has also reaffirmed its credit opinion on the second loss facility at ‘CRISIL BBB (SO) Equivalent’. The underlying receivables arise from a pool of commercial vehicle and passenger vehicle loans originated by Shriram Transport Finance Company Limited (STFCL; rated ‘CRISIL AA+/FAAA/Stable/CRISIL A1+’).
The performance of the pool is in line with CRISIL’s expectations. The pool has seen a stable collection performance with a CCR of 95.4 per cent and a 3 month average MCR of 98.9 per cent as of June 2015 payouts. The healthy collection performance coupled with high amortisation of around 68 per cent has led to an increase in the credit cover available to the future PTC payouts from the cash collateral.
The cash collateral in the transaction has been reset. At the time of securitisation, this transaction had cash collateral of Rs. 703.0 million. Following the reset, Rs. 206.8 million (29.4 per cent of the initial cash collateral) will be released and the revised CE stands at Rs. 496.2 million. The cash collateral, after reset, remains commensurate with the outstanding ratings on the pool. CRISIL has ensured its conformity to all aspects mentioned in the RBI reset guidelines.
Pool Performance Summary (as of June 2015 payouts)
Parameters||Sansar Trust Sep 2013 –II|
|Asset Class||Commercial vehicle and passenger vehicle loan receivables|
|Months Post Securitisation||20|
|Balance Tenure (Months)||34|
|Cumulative Collection Ratio*||95.4%|
|Average Monthly Collection Ratio* over Past 3 Months||98.9%|
|Credit collateral utilisation||0.0%|
|Credit collateral as percentage of Future payouts||33.6%|
|First loss facility as percentage of Future payouts||14.3%|
|Threshold Collection Ratio (TCR)%||63.1%|
* Due to data limitation, billings and collection amount considered in calculation of CCR and MCR include advance collections
# 90+ delinquency = (Overdues + principal outstanding of contracts overdue for more than 90 days) ÷ Initial pool principal
^ 180+ delinquency = (Overdues + principal outstanding of contracts overdue for more than 180 days) ÷ Initial pool principal
%Threshold collection ratio (TCR) = the minimum cumulative collection ratio (cumulative collections/cumulative billings) required on a pool’s future cash flows, to be able to service the PTC payouts on time.
About the Originator
STFCL, incorporated in 1979, is the flagship company of the Shriram group. The company is registered with the Reserve Bank of India as a deposit-taking, asset-financing non-banking financial company. STFCL operates in the asset-financing sector and provides financing for vehicles such as CVs (both pre-owned and new), tractors, and passenger vehicles. The company has pan-India presence, with 741 branches and 776 rural centers as on March 31, 2015.
STFCL reported total income (net of interest expense) and profit after tax (PAT) of Rs.41.8 billion and Rs.12.4 billion, respectively, for 2014-15, against Rs.38.1 billion and Rs.12.6 billion, respectively, for 2013-14.
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August 17, 2015