OREANDA-NEWS. April 04, 2016. Fitch Ratings affirms two classes and upgrades one class of Susquehanna Auto Receivables Trust 2014-1 (SART 2014-1) as follows:

--Class A-3 asset-backed notes affirmed at 'AAAsf'; Outlook Stable;
--Class A-4 asset-backed notes affirmed at 'AAAsf'; Outlook Stable;
--Class B asset-backed notes upgraded to 'AAsf' from 'Asf'; Outlook Positive.

KEY RATING DRIVERS
The ratings are based on available credit enhancement and loss performance. Under the credit enhancement structure, the securities are able to withstand stress scenarios consistent with the current ratings and make full payments to investors in accordance with the terms of the documents. The Positive Outlook on the subordinate notes reflects Fitch's expectation that as loss coverage levels improve positive rating actions are likely over the course of the next 12 months.

Following the acquisition of Susquehanna Bancshares Inc. (SBI) on Aug. 1, 2015 by BB&T Corporation (BB&T), Hann Financial (Hann) has taken over all servicing and administrative responsibilities for the portfolio, including collections and repossession activity. Prior to the acquisition, Hann had been servicing approximately 25% of the collateral and Fitch had assessed their servicing capabilities at close. Fitch does not believe the transfer of responsibilities to Hann will negatively impact performance moving forward and deems Hann an adequate servicer capable of servicing the SART 2014-1 pool of receivables.

RATING SENSITIVITIES
Unanticipated increases in the frequency of defaults and loss severity could produce loss levels higher than the current projected base case loss proxy and impact available loss coverage and multiple levels. Lower loss coverage could impact ratings and Outlooks, depending on the extent of the decline in coverage.

In Fitch's initial review of the transaction, the notes were found to have limited sensitivity to a 1.5x and 2.5x increase of Fitch's base case loss expectation. To date, the transaction has exhibited strong performance with losses well within Fitch's initial expectation with rising loss coverage and multiple levels. As such, a material deterioration in performance would have to occur within the asset pool to have potential negative impact on the outstanding ratings.

DUE DILIGENCE USAGE
No third-party due diligence was provided or reviewed in relation to these rating actions.