OREANDA-NEWS. S&P Global Ratings today assigned its preliminary ratings to USAA Auto Owner Trust 2016-1's $500.00 million asset-backed notes series 2016-1 (see list).

The note issuance is an asset-backed securities transaction backed by prime auto loan receivables.

The preliminary ratings are based on information as of Sept. 8, 2016. Subsequent information may result in the assignment of final ratings that differ from the preliminary ratings.

The preliminary ratings reflect:The availability of 4.30% and 2.66% of credit support for the class A-1 through A-4 (collectively, the class A) and B notes, respectively, based on stressed cash flow scenarios (including excess spread), which provide coverage of more than 5.0x and 3.0x our 0.60%-0.80% expected cumulative net loss. The timely interest and principal payments made under stressed cash flow modeling scenarios appropriate to the assigned preliminary ratings. Our expectation that under a moderate ('BBB') stress scenario, all else being equal, our ratings on the class A and B notes will remain within one rating category of the assigned preliminary ratings during the first year, which is within the outer bounds of our credit stability criteria (see "Methodology: Credit Stability Criteria," published May 3, 2010).The loss projections based on our review of USAA Federal Savings Bank's (USAA FSB) previous securitizations' performance, origination static pool data, and managed portfolio data; USAA FSB's deal-level collateral characteristics and comparison with its prime auto finance peers; and our forward-looking view of the economy. USAA FSB's long securitization track record, having securitized auto loans since 1993.The transaction's payment and legal structures.