NEW YORK--(BUSINESS WIRE)--Kroll Bond Rating Agency (KBRA) assigns preliminary ratings to three classes of notes issued by Mosaic Solar Loan Trust 2018-1 (“Mosaic 2018-1”). This is a $235.250 million term ABS securitization collateralized by a pool of approximately $257.9 million residential solar loans.
Mosaic 2018-1 will issue three classes of notes in an aggregate principal amount of $235.250 million with an expected closing date of April 20, 2018. The Class A and Class B Notes will bear interest and the Class C Notes are principal only notes and will not bear interest. The Notes are backed by a pool of mostly prime quality residential consumer solar loans and underlying solar energy systems, including, without limitation, solar panels or modules, inverters, electricity storage, charging/monitoring equipment (including batteries and automobile charging equipment), prepaid operations and maintenance agreements and related landscaping, roofing or re-roofing, wiring, electrical system upgrades and any additional equipment or services related to installation. Credit enhancement on the Notes consists of i) overcollateralization ii) yield supplement overcollateralization iii) subordination (in the case of Class A and Class B Notes) and iv) amounts on deposit in a reserve account.
Mosaic is a California based specialty finance company focused on originating and servicing consumer loans used for the purchase of grid tied residential solar systems. Founded in 2011, Mosaic originates loans to mostly prime credit quality homeowners through its partnerships with more than 150 prescreened, independent solar system installers/dealers, including 15 of the top 25 installers nationally. Mosaic disburses funds directly to installers, equal to the system cost minus installer discounts.
KBRA applied its General Rating Methodology for Asset-Backed Securities as part of its analysis of the transaction’s underlying collateral pool and the proposed capital structure. KBRA also conducted an operational assessment of Mosaic in August 2017, as well as a review of the transaction’s legal structure and transaction documents. KBRA will review the operative agreements and legal opinions for the transaction prior to closing.
| Class | Preliminary Rating | Principal Balance | ||||||||||
| A | A (sf) | $195,750,000 | ||||||||||
| B | BBB- (sf) | $23,200,000 | ||||||||||
| C | BB- (sf) | $16,300,000 | ||||||||||
Representations & Warranties Disclosure
All Nationally Recognized Statistical Rating Organizations are required, pursuant to SEC Rule 17g-7, to provide a description of a transaction’s representations, warranties and enforcement mechanisms that are available to investors when issuing credit ratings. KBRA’s disclosure for this transaction can be found in the report available here.
Related Publications: (available at www.kbra.com)
- Mosaic Solar Loans Trust 2018-1 Pre-Sale Report
- General Rating Methodology for Asset-Backed Securities
- Mosaic Solar Loans Trust 2018-1 Peer Comparison
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KBRA is a full service credit rating agency registered with the U.S. Securities and Exchange Commission as an NRSRO. In addition, KBRA is recognized by the National Association of Insurance Commissioners as a Credit Rating Provider and a certified Credit Rating Agency (CRA) by the European Securities and Markets Authority (ESMA). Kroll Bond Rating Agency Europe Limited is registered with ESMA as a CRA.
