DBRS Assigns Provisional Ratings to CCG Receivables Trust 2018-1

DBRS, Inc. (DBRS) assigned provisional ratings to the following Series 2018-1 notes (the Notes) to be issued by CCG Receivables Trust 2018-1 (the Issuer):

-- $91,200,000, Class A-1 Notes rated R-1 (high) (sf)
-- $176,302,000, Class A-2 Notes rated AAA (sf)
-- $30,366,000, Class B Notes rated A (sf)
-- $7,826,000, Class C Notes rated BBB (sf)

This issuance represents the eighth term asset-backed securitization sponsored by Commercial Credit Group Inc. (CCG) and the seventh rated by DBRS. It is secured by larger small-ticket equipment loan and lease contracts, a security interest in the related equipment and related accounts, insurance proceeds and other related assets. The Notes will be issued under Rule 144A.

The ratings are based on a review by DBRS of the following analytical considerations:

-- Credit enhancement available to each class of Notes is sufficient to ensure timely periodic interest payments and repayment of principal by the final maturity date for each class of Notes in DBRS’s cash flow analysis.
-- The sequential amortization of the Notes; subordination; the non-declining, replenishable reserve account; and the overcollateralization floor are expected to create credit enhancement for the Notes that increases over time.
-- The historical performance of the assets originated by CCG with respect to recoveries and net losses has been consistent.
-- The expected collateral pool is granular. The collateral composition is similar to that included in CCG’s previous term securitizations, all of which have performed well within DBRS’s expectations.
-- The originator’s management team has considerable experience and expertise in the equipment leasing industry and continues to maintain a strong competitive position by focusing on financing essential income-producing commercial equipment to small and medium-sized businesses.
-- A satisfactory review of the legal structure and presence of legal opinions that address true sale and non-consolidation of the assets, which are held by the special-purpose vehicle, and a valid first-priority security interest of the Indenture Trustee in the assets. The transaction is also reviewed for consistency with the DBRS “Legal Criteria for U.S. Structured Finance.”
-- The presence of Portfolio Financial Servicing Company, an experienced servicer of equipment-backed collateral, as the Backup Servicer for this transaction.

Notes:
All figures are in U.S. dollars unless otherwise noted.

The principal methodology is Rating U.S. Equipment Lease and Loan Securitizations, which can be found on dbrs.com under Methodologies.

The rated entity or its related entities did participate in the rating process for this rating action. DBRS had access to the accounts and other relevant internal documents of the rated entity or its related entities in connection with this rating action.

Please see the related appendix for additional information regarding the sensitivity of assumptions used in the rating process.

For more information on this credit or on this industry, visit www.dbrs.com or contact us at info@dbrs.com.