Small business loan ABS trust first to be assigned rating

Prospa’s Australian small business loan asset-backed securities trust has become the first in Australasia to be assigned a rating.

The ABS issuance, which involved a total of $83.25 million in debt securities, is backed by unsecured small business loans and was rated by Moody’s Investors Service (Moody’s).

The Prospa Trust Series 2018-1 was rated as follows:

  • $64.80 million Class A Notes, Assigned A3
  • $14.67 million Class B Notes, Assigned Ba2
  • $3.78 million Class C Notes, Assigned B3 

The initial underlying receivables are short-term, high-yield, unsecured, amortising loans made to Australian small businesses.

The initial average term of the unsecured loans is approximately 12 months, with the maximum loan term of 24 months.

The average loan size is $26,000. 

Speaking of the rating, Prospa’s joint chief executive, Beau Bertoli, said: “We are delighted to have been assigned ratings by Moody’s for our small business loan ABS trust.

“This is an important milestone in the diversification of our funding that will appeal to a broader group of fixed income institutional investors.”

[Related: Reckon Loans passes $10m milestone]

Small business loan ABS trust first to be assigned rating
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