Kroll Bond Rating Agency assigned preliminary ratings to four classes of notes issued by MassMutual Asset Finance Equipment Finance 2023-A (MMAF 2023-A), MassMutual Asset Finance’s 19th equipment ABS transaction.
The MMAF 2023-A transaction is secured by a portfolio of equipment lease and loan contracts, together with interests in the related equipment and other collateral (together, the financed units). The financed units include various types of equipment, including transportation equipment, federal energy equipment, machinery and equipment, marine equipment, computers, vending equipment, railcars, software, intermodal containers, real estate, corporate aircraft, material handling equipment, construction equipment, furniture and fixtures, medical equipment, energy management and service vehicles. MMAF 2023-A will issue four classes of notes. The notes benefit from credit enhancement in the form of overcollateralization, excess spread and a reserve account.
The aggregate securitization value (ASV), which represents the discounted value of the cash flows, other than interest or implicit yield on floating rate contracts, from the financed units, is $889 million, as of May 31, and based on the statistical discount rate of 7.75%. The ASV includes 422 financed units to 76 obligors. The average financed unit balance is approximately $2.11 million and the average obligor exposure is approximately $11.7 million. The maximum obligor exposure, which is to the U.S. government, is $223.2 million, or 25.11% of the ASV. The next largest obligor exposure is $77.24 million, or 8.69% of the ASV.
