XML 23 R13.htm IDEA: XBRL DOCUMENT v3.22.0.1
(5) Securitization Trust Debt
 12 Months Ended
Dec. 31, 2021
Securitization Trust Debt  
(5) Securitization Trust Debt

(5) Securitization Trust Debt

 

We have completed numerous term securitization transactions that are structured as secured borrowings for financial accounting purposes. The debt issued in these transactions is shown on our Consolidated Balance Sheets as “Securitization trust debt,” and the components of such debt are summarized in the following table: 

                  
                  Weighted
                  Average
   Final  Receivables     Outstanding  Outstanding  Contractual
   Scheduled  Pledged at     Principal at  Principal at  Interest Rate at
   Payment  December 31,  Initial  December 31,  December 31,  December 31,
Series  Date (1)  2021 (2)  Principal  2021  2020  2021
(Dollars in thousands)
CPS 2015-B  September 2022  $–   $250,000   $–   $17,984    – 
CPS 2015-C  December 2022   –    300,000    –    28,529    – 
CPS 2016-A  March 2023   –    329,460    –    37,158    – 
CPS 2016-B  June 2023   –    332,690    –    46,079    – 
CPS 2016-C  September 2023   –    318,500    –    47,325    – 
CPS 2016-D  April 2024   –    206,325    –    36,455    – 
CPS 2017-A  April 2024   21,381    206,320    17,644    40,619    7.07%
CPS 2017-B  December 2023   27,922    225,170    12,491    39,016    5.75%
CPS 2017-C  September 2024   30,061    224,825    25,846    47,553    5.68%
CPS 2017-D  June 2024   30,994    196,300    26,744    49,297    4.95%
CPS 2018-A  March 2025   34,363    190,000    29,518    53,549    4.68%
CPS 2018-B  December 2024   42,054    201,823    36,092    66,955    5.10%
CPS 2018-C  September 2025   47,708    230,275    42,765    77,345    5.27%
CPS 2018-D  June 2025   58,204    233,730    49,634    88,228    5.12%
CPS 2019-A  March 2026   72,750    254,400    62,667    114,373    4.90%
CPS 2019-B  June 2026   72,683    228,275    61,730    118,982    4.61%
CPS 2019-C  September 2026   85,381    243,513    75,065    142,080    3.76%
CPS 2019-D  December 2026   109,469    274,313    98,625    181,485    3.20%
CPS 2020-A  March 2027   104,000    260,000    99,485    184,944    3.32%
CPS 2020-B  June 2027   110,962    202,343    87,048    164,403    4.58%
CPS 2020-C  November 2027   150,173    252,200    138,899    231,961    2.35%
CPS 2021-A  March 2028   162,217    230,545    147,516    –    0.97%
CPS 2021-B  June 2028   189,319    240,000    179,856    –    1.24%
CPS 2021-C  September 2028   264,525    291,000    250,003    –    1.11%
CPS 2021-D  December 2028   340,451    349,202    330,325    –    1.39%
      $1,954,617   $6,271,209   $1,771,953   $1,814,320      

_________________________

(1)The Final Scheduled Payment Date represents final legal maturity of the securitization trust debt. Securitization trust debt is expected to become due and to be paid prior to those dates, based on amortization of the finance receivables pledged to the Trusts. Expected payments, which will depend on the performance of such receivables, as to which there can be no assurance, are $687.9 million in 2022, $621.2 million in 2023, $150.6 million in 2024, $167.0 million in 2025, $92.1 million in 2026, and $41.2 million in 2027.

 

(2)Includes repossessed assets that are included in Other Assets on our Consolidated Balance Sheets.

 

Debt issuance costs of $12.0 million and $10.6 million as of December 31, 2021 and December 31, 2020, respectively, have been excluded from the table above. These debt issuance costs are presented as a direct deduction to the carrying amount of the Securitization trust debt on our Consolidated Balance Sheets.

 

All of the securitization trust debt was issued in private placement transactions to qualified institutional investors. The debt was issued by our wholly-owned, bankruptcy remote subsidiaries and is secured by the assets of such subsidiaries, but not by any of our other assets.

 

The terms of the various securitization agreements related to the issuance of the securitization trust debt require that certain delinquency and credit loss criteria be met with respect to the collateral pool, and require that we maintain minimum levels of liquidity and net worth and not exceed maximum leverage levels. We were in compliance with all such covenants as of December 31, 2021.

 

We are responsible for the administration and collection of the contracts. The securitization agreements also require certain funds be held in restricted cash accounts to provide additional credit enhancement for the Notes or to be applied to make payments on the securitization trust debt. As of December 31, 2021, restricted cash under the various agreements totaled approximately $146.6 million. Interest expense on the securitization trust debt is composed of the stated rate of interest plus amortization of additional costs of borrowing. Additional costs of borrowing include facility fees, insurance premiums, amortization of deferred financing costs, and amortization of discounts required on the notes at the time of issuance. Deferred financing costs related to the securitization trust debt are amortized using the interest method. Accordingly, the effective cost of borrowing of the securitization trust debt is greater than the stated rate of interest.

 

Our wholly-owned, bankruptcy remote subsidiaries were formed to facilitate the above asset-backed financing transactions. Similar bankruptcy remote subsidiaries issue the debt outstanding under our warehouse line of credit. Bankruptcy remote refers to a legal structure in which it is expected that the applicable entity would not be included in any bankruptcy filing by its parent or affiliates. All of the assets of these subsidiaries have been pledged as collateral for the related debt. All such transactions, treated as secured financings for accounting and tax purposes, are treated as sales for all other purposes, including legal and bankruptcy purposes. None of the assets of these subsidiaries are available to pay any of our other creditors.