Regional Management, a diversified consumer finance company, closed its first securitization backed by large loan receivables. The senior class of the securitization received an “AA” rating from DBRS.
Qualified institutional buyers purchased $150 million of asset-backed notes, secured by $168.5 million of large loan receivables originated by Regional Management. The sold notes, issued by Regional Management Issuance Trust 2018-1, consist of three classes.
“We are excited to have successfully completed our first term securitization,” said Peter R. Knitzer, president and CEO of Regional Management. “This milestone both increases and diversifies our funding capabilities, positioning Regional for further growth while reducing our overall cost of capital. We remain very well positioned to generate long-term value for our shareholders.”
Ratings of the notes were based on a variety of factors, including the structure of the transaction, the ability of the transaction to withstand stressed cash flow assumptions and repay investors, Regional’s capabilities with regard to originations, underwriting and servicing and the credit quality of the collateral and performance of Regional’s consumer loan portfolio.
Regional Management provides a broad array of loan products primarily to customers with limited access to consumer credit from banks, thrifts, credit card companies and other traditional lenders. Regional Management began operations in 1987 in South Carolina and currently has branches in nine states.