Fitch Affirms Mercedes-Benz Auto Lease Trust 2013-A
--Class A-3 notes at 'AAAsf'; Outlook Stable;
--Class A-4 notes at 'AAAsf'; Outlook Stable.
KEY RATING DRIVERS:
The affirmations reflect the increase in credit enhancement since closing and strong collateral performance. Credit and residual losses have been well within Fitch's expectations to date. The Stable Outlook reflects Fitch's expectation that the notes will remain sufficiently enhanced to cover 'AAAsf' stressed loss levels.
Fitch will continue to monitor economic conditions and their impact as well as trust level performance variables and update the ratings accordingly.
RATING SENSITIVITY:
Unanticipated increases in the frequency of defaults or deterioration in vehicle values could produce loss levels higher than the current expectations and impact available loss coverage. Lower loss coverage could impact ratings and Rating Outlooks, depending on the extent of the decline in coverage.
To date, the transaction has exhibited strong credit and residual performance, well within Fitch's initial expectations with rising loss coverage. Due to the growing credit enhancement levels and increased loss coverage afforded to the notes, a substantial deterioration in used vehicle values would have to occur to have a negative impact on the updated ratings.
Fitch's stress and rating sensitivity analyses are discussed in the presale reports titled 'Mercedes-Benz Auto Lease Trust 2013-A (US ABS)', published April 2013, which is available on Fitch's web site.
Fitch's analysis of the Representations and Warranties (R&W) of this transaction can be found in 'Mercedes-Benz Auto Lease Trust 2013-A -- Appendix'. These R&W are compared to those of typical R&W for the asset class as detailed in the special report 'Representations, Warranties, and Enforcement Mechanisms in Global Structured Finance Transactions' published October 2014.
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