Stonebriar Commercial Finance Closes Eighth Asset-Backed Securitization

Stonebriar Commercial Finance closed its eighth asset-backed securitization, SCFET 2021-1. The ABS issuance is secured by a portfolio of commercial equipment loans and leases with an aggregate discounted contract balance of more than $1 billion and with 64 obligors and a weighted average IRR of 8.24%. According to Stonebriar, the top tranches earned the highest possible short-term and long-term ratings from Moody’s Investors Service and Kroll Bond Ratings.

The SCFET 2021-1 portfolio is diversified across a variety of asset classes, including rail, aviation, marine transportation and manufacturing in the U.S. and Canada. As with the company’s SCFET 2020-1 ABS issuance last summer, the A-1 tranche achieved “P-1” and “K1+” ratings from Moody’s and Kroll, respectively, while the A-2 and A-3 tranches of the transaction each received ratings of “Aaa” and “AAA.” SCFET 2021-1 included assets from Stonebriar’s five business platforms — general equipment, aviation capital, rail leasing, real estate and sponsor finance — including transactions from its Canadian portfolio.

BofA Securities and Credit Suisse Securities each served as co-structuring agents and co-lead bookrunners. Citizens Capital Markets, Fifth Third Securities and RBC Global Markets served as co-managers on the financing. Stonebriar will continue to service the assets, with US Bank acting as backup servicer and custodian. Vedder Price provided legal counsel to Stonebriar.

“Our eighth securitization will serve as a foundation for the company’s continued growth in 2021. SCFET 2021-1 provides Stonebriar with cost-efficient funding to refinance existing indebtedness while continuing to meet the strong demand we see in our marketplace,” Dave B. Fate, president and CEO of Stonebriar Commercial Finance, said. “The transaction was met with over $3.0bn of demand from 48 third party investors across 88 separate orders. The teams at Bank of America and Credit Suisse provided excellent service in structuring and marketing the deal. Our strong, committed bank group remains an essential ingredient in Stonebriar’s success, and we value their continued efforts.

“Stonebriar’s strong credit performance and disciplined underwriting during periods of dislocation, such as 2020, resonate with both rating agencies and investors. Our team’s diligent focus on the left side of the balance sheet continues to foster tremendous results on the right side. SCFET 2021-1 continues to validate that approach. We’re proud to count over 70 institutions in our ABS investor base, including some of the largest global asset managers, pension funds and insurance companies.”

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