Thursday August 19, 7:28 pm Eastern Time
Company Press Release
SOURCE: Westar Financial Services Incorporated
Westar Places $28.8 Million of A+ Bonds
Auto Lease Backed Securities Earn Investment Grade Ratings
OLYMPIA, Wash., Aug. 19 /PRNewswire/ -- Westar Financial Services Incorporated (OTC Bulletin Board: WEST - news), a prime-credit auto lessor, today announced it has directly placed $28.8 million of automobile lease receivable certificates with a group of insurance companies. The bonds, graded by Duff & Phelps, earned an A+ rating for the largest tranche of $27.8 million and BBB for the smaller tranche of $1 million. The securitization is immediately cash positive to Westar by approximately 1% of the cost of the contracts. At their request, Westar also granted the institutional investor group rights of first refusal for $100 million in auto lease securities over the next two years.
''We continue building our network of financial partners and have now developed ongoing relationships with some of the largest and most respected institutions in the industry, including Bank One and First Union,'' said R.W. Christensen, Jr., Westar's Chairman and Chief Executive Officer. ''We expect to add others over the course of this year, particularly as we prepare to ramp up loan and lease originations through our e-finance alliance with DriveOff.com,'' he added. DriveOff.com, Inc. is a subsidiary of Navidec, Inc.
The securitization certificates were issued with a five and one-half year term and are backed by auto contracts from the prime-credit sector of the consumer auto market. The transaction includes a six-month funding period, which allows Westar to originate new leases over the next six months at the same cost. The securitization is a fixed rate instrument, was created using Westar's uniquely re-usable Carlson Trust, and does not carry any third party credit enhancements. ''The achievement of a cash-positive, investment-grade securitization is unusual. The transaction is a tribute to both our structuring expertise and the senior-subordinated enhancement and reflects the comfort that investors have in our business. By locking in rates in April, when this transaction was finalized, we benefited from the rising interest rate environment. In addition, as the transaction includes a six month funding period, we expect these fixed rate notes will contribute to strong margins for the duration of this economic cycle,'' noted Christensen.
Westar Financial Services Incorporated is an innovative, fast-growing, Washington-based automobile financing company. It has focused solely on the prime-credit segment of the $110 billion auto-lease finance market and has completed thirteen securitizations of auto lease receivable certificates for the prime credit market. WEST is the only publicly-traded automobile lease finance company focused solely on this huge market.
Statement regarding ''Forward Looking Statements'': Statements concerning future performance, developments or events, including the ability to penetrate new markets and capture market share, gain product acceptance, achieve technological success, maintain access to the capital markets, operate under fluctuating interest rates or any other guidance on future periods, constitute forward-looking statements which are subject to a number of risks and uncertainties which might cause actual cause results to differ from stated expectations.
SOURCE: Westar Financial Services Incorporated |
