KBRA Assigns Preliminary Ratings to OneMain Direct Auto Receivables Trust 2023-1

KBRA assigns preliminary ratings to four classes of notes issued by OneMain Direct Auto Receivables Trust 2023-1 (“ODART 2023-1”), an auto loan ABS transaction.

ODART 2023-1 will issue four classes of notes totaling $400.0 million. The preliminary ratings reflect initial credit enhancement levels ranging from 31.75% for the Class A notes to 5.75% for the Class D notes. This transaction represents the first auto loan ABS securitization issued by OneMain Finance Corporation (“OneMain” or “OMFC”, or the “Company”), a wholly-owned subsidiary of OneMain Holdings, Inc. (“OMH”), in 2023. OneMain has also issued seven auto loan and 27 consumer loan securitizations through its subsidiaries since 2013. ODART 2023-1 includes a three-year revolving period during which collections may be used to purchase new collateral so long as it meets the eligibility criteria and reinvestment criteria.

OneMain Holdings, Inc. (“OMH”) is a consumer finance company which offers loan products through a nationwide network of branches and through its online platform. OMH completed its acquisition of OneMain Financial Holdings, LLC on November 15, 2015 from CitiFinancial Credit Company for $4.49 billion in cash. OMH is now listed on the NYSE under the ticker symbol “OMF”.

KBRA applied its Auto Loan ABS Global Rating Methodology, as well as its Global Structured Finance Counterparty Methodology and ESG Global Rating Methodology as part of its analysis of the transaction’s underlying collateral pool and the capital structure using stressed cash flow assumptions. KBRA considered its operational review of OneMain, as well as periodic update calls with the Company. Operative agreements and legal opinions will be reviewed prior to closing.

To access ratings and relevant documents, click here.

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Related Publications

• Auto Loan ABS Global Rating Methodology
• Global Structured Finance Counterparty Methodology
• ESG Global Rating Methodology

Disclosures

Further information on key credit considerations, sensitivity analyses that consider what factors can affect these credit ratings and how they could lead to an upgrade or a downgrade, and ESG factors (where they are a key driver behind the change to the credit rating or rating outlook) can be found in the full rating report referenced above.

A description of all substantially material sources that were used to prepare the credit rating and information on the methodology(ies) (inclusive of any material models and sensitivity analyses of the relevant key rating assumptions, as applicable) used in determining the credit rating is available in the Information Disclosure Form(s) located here.

Information on the meaning of each rating category can be located here.

Further disclosures relating to this rating action are available in the Information Disclosure Form(s) referenced above. Additional information regarding KBRA policies, methodologies, rating scales and disclosures are available at www.kbra.com.

About KBRA

Kroll Bond Rating Agency, LLC (KBRA) is a full-service credit rating agency registered with the U.S. Securities and Exchange Commission as an NRSRO. Kroll Bond Rating Agency Europe Limited is registered as a CRA with the European Securities and Markets Authority. Kroll Bond Rating Agency UK Limited is registered as a CRA with the UK Financial Conduct Authority. In addition, KBRA is designated as a designated rating organization by the Ontario Securities Commission for issuers of asset-backed securities to file a short form prospectus or shelf prospectus. KBRA is also recognized by the National Association of Insurance Commissioners as a Credit Rating Provider.

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