Fitch Rates Golden Credit Card Trust, Series 2015-4; Outlook Stable
December 01 2015 - 4:54PM
Business Wire
Fitch Ratings assigns the following ratings to Golden Credit
Card Trust, series 2015-4 asset-backed notes:
--CAD400,000,000 CAD class A 'AAAsf'; Outlook Stable;
--CAD19,251,337 CAD class B 'Asf'; Outlook Stable;
--CAD8,556,150 CAD class C 'BBB+sf'; Outlook Stable.
KEY RATING DRIVERS
High Collateral Quality: The underlying collateral
characteristics play a vital role in the performance of a credit
card ABS transaction. Fitch closely examines such collateral
characteristics as credit quality, seasoning, geographic
concentration, delinquencies and utilization rates.
Strong Collateral Performance Metric: As of November 2015,
Golden Credit Card Trust's (GCCT) collateral performance metrics
were in line with the Fitch indices. Charge-offs, 60+ day
delinquencies and monthly payment rate have remained relatively
stable over the past 24 months. Gross yield has been robust over
the past two years.
Adequate Credit Enhancement (CE): The class A notes will benefit
from 6.50% CE derived through the subordination of both class B and
class C notes and the cash reserve account.
The class B notes will benefit from 2.00% CE derived through the
subordination of class C notes and the cash reserve account.
The class C notes CE is based solely on the cash reserve
account.
Quality Servicing Capabilities: Royal Bank of Canada (RBC) is an
effective servicer, as evidenced by historical delinquency and loss
performance of securitized receivables. Deterioration in the credit
quality of RBC may affect the performance of the collateral pool
backing the notes.
RATING SENSITIVITIES
Fitch models three different scenarios when evaluating the
rating sensitivity compared to expected performance for credit card
asset-backed securities transactions: 1) increased defaults; 2) a
reduction in monthly payment rate (MPR); and 3) a combination
stress of higher defaults and lower MPR.
The harshest stress scenario of a combined 75% increase to
defaults and a 35% reduction of MPR could lead to a two-notch
downgrade for classes A and B, while class C has no rating impact.
The rest of the stress scenarios are unlikely to impact the
ratings.
DUE DILIGENCE USAGE
No third-party due diligence was provided or reviewed in
relation to this rating action.
The publication of a RW&Es appendix is not required for this
transaction.
Additional information is available at www.fitchratings.com
Applicable Criteria
Counterparty Criteria for Structured Finance and Covered Bonds
(pub. 14 May 2014)
https://www.fitchratings.com/creditdesk/reports/report_frame.cfm?rpt_id=744158
Counterparty Criteria for Structured Finance and Covered Bonds:
Derivative Addendum (pub. 14 May 2014)
https://www.fitchratings.com/creditdesk/reports/report_frame.cfm?rpt_id=744175
Criteria for Interest Rate Stresses in Structured Finance
Transactions and Covered Bonds (pub. 19 Dec 2014)
https://www.fitchratings.com/creditdesk/reports/report_frame.cfm?rpt_id=838868
Global Credit Card ABS Rating Criteria (pub. 26 Jun 2015)
https://www.fitchratings.com/creditdesk/reports/report_frame.cfm?rpt_id=867482
Global Structured Finance Rating Criteria (pub. 06 Jul 2015)
https://www.fitchratings.com/creditdesk/reports/report_frame.cfm?rpt_id=867952
Additional Disclosures
Dodd-Frank Rating Information Disclosure Form
https://www.fitchratings.com/creditdesk/press_releases/content/ridf_frame.cfm?pr_id=995739
Solicitation Status
https://www.fitchratings.com/gws/en/disclosure/solicitation?pr_id=995739
Endorsement Policy
https://www.fitchratings.com/jsp/creditdesk/PolicyRegulation.faces?context=2&detail=31
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ENTITY SUMMARY PAGE FOR THIS ISSUER ON THE FITCH WEBSITE.
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version on businesswire.com: http://www.businesswire.com/news/home/20151201006796/en/
Fitch RatingsPrimary AnalystJenny Ovalle,
+1-212-908-0849Associate DirectorFitch Ratings, Inc.33 Whitehall
StreetNew York, NY 10004orSecondary AnalystHerman Poon,
+1-212-908-0847DirectorCommittee ChairpersonMichael Dean,
+1-212-908-0556Managing DirectororMedia RelationsSandro Scenga, New
York, +1-212-908-0278sandro.scenga@fitchratings.com