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

This transaction represents Veros Credit LLC (“Veros” or the “Company”) first term ABS securitization of 2023 and sixth overall. VEROS 2023-1 will issue four classes of notes totaling $214.46 million. The Notes are collateralized by a pool of auto loan contracts originated on an indirect basis mainly through independent auto dealers. In the fall of 2022, the Company began originating luxury vehicle loans to high net-worth customers where the original finance amount can range from $50,000 to $500,000. VEROS 2023-1 is expected to be collateralized by approximately 4.0% of luxury vehicle loans.

Veros is a privately-owned indirect auto finance company based in California. The Company was founded in 1998 as Credit One Corporation and rebranded as Veros Credit LLC in 2010. Based on financials provided by the Company, Veros has been profitable since inception. As of March 31, 2023, Veros operates in 23 states and has a loan portfolio with an aggregate outstanding balance of $540.3 million.

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, the proposed capital structure, and Veros’ historical static pool data. KBRA considered its operation review of Veros, as well as periodic due diligence calls with Veros. Operative agreements and legal opinions were reviewed prior to closing.

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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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