Scope Ratings GmbH (Scope) monitors and reviews its credit ratings on an ongoing basis and at least annually, or every six months in the case of sovereigns, sub-sovereigns and supranational organisations.

Scope performs monitoring reviews to determine whether material changes and/or changes in macroeconomic or financial market conditions could have an impact on the credit ratings. Scope considers all available and relevant information when undertaking the monitoring review.

Monitoring reviews are conducted by performing a peer comparison, benchmarking against the rating-change drivers, and/or reviewing the credit ratings’ performance over time, as deemed appropriate by the Lead Analyst or Analytical Team Head, in addition to an assessment of all aspects of the relevant methodology/ies, including key rating assumptions and model(s). Scope publicly announces the completion of each monitoring review on its website.

Scope completed the monitoring review of Debt Marketplace SARL - Compartment B on 22 September 2022. The credit ratings remain as follows:

Lessee payment contingent fixed rate notes, EUR 79.87m outstanding: BBB-_SF

Debt Marketplace SARL - Compartment B is a cash securitisation of bike lease receivables originated by Hofmann Leasing GmbH, with a corresponding total issuance amount of up to EUR 100mn. The issue period ended in April 2022 with the maximum amount of EUR 100m of notes issued. In total EUR 102.53 of leases were financed, representing a purchase price of EUR 97.61m. The unused issuance proceeds were used to fill the cash reserve. During the issue period, the transfer value of receivables was adjusted downwards by 75 bps, in accordance with the transaction contracts, as the operational servicer received an issuer credit rating with satisfactory credit quality from Scope. Amortisation of the notes started after conclusion of the issue period. The notes continue being overcollateralized with an overcollateralization ratio of 105.2% at end of August.

The review was conducted based on available investor reports reflecting performance up to the August 2022 payment date.

This monitoring note does not constitute a credit rating action, nor does it indicate the likelihood that Scope will conduct a credit rating action in the short term. Information about the latest credit rating action connected with this monitoring note along with the associated rating history can be found on www.scoperatings.com.

Key rating factors

CREDIT-POSITIVE (+)

Portfolio concentration limits. The portfolio after end of the issue period is more granular with respect to obligors and industry exposures than assumed by Scope at closing. Obligor selection during the issue period (based on third-party credit scores) resulted in metrics below the thresholds set by the portfolio concentration limits.

Good performance. As of August 2022, only two borrowers defaulted and two more are at risk to default, which is below Scope’s default assumptions.

CREDIT-NEGATIVE (-)

Macroeconomic uncertainties. Scope has revised downward GDP growth expectations to 1.6% from 2.8% in December 2021. Employment conditions continue to be tight, but risks are tilted to the downside. The steep rise in energy prices resulting from the war in Ukraine is driving up the already high inflation rate (7.9% in August 2022), eroding households’ purchasing power. Increased supply bottlenecks are throttling production and exports are also suffering from weaker demand. Overall economic performance is considerably weaker than was assumed in last year’s projections. These challenges might reflect negatively on the portfolio’s credit quality.

The methodologies applicable for the reviewed ratings (General Structured Finance Rating Methodology, 17 December 2021; Counterparty Risk Methodology, 14 July 2022) are available on https://scoperatings.com/governance-and-policies/rating-governance/methodologies.
This monitoring note is issued by Scope Ratings GmbH, Lennéstraße 5, D-10785 Berlin, Tel +49 30 27891-0.
Lead analyst: Martin Hartmann, Associate Director

© 2022 Scope SE & Co. KGaA and all its subsidiaries including Scope Ratings GmbH, Scope Ratings UK Limited, Scope Analysis GmbH, Scope Investor Services GmbH, and Scope ESG Analysis GmbH (collectively, Scope). All rights reserved. The information and data supporting Scope’s ratings, rating reports, rating opinions and related research and credit opinions originate from sources Scope considers to be reliable and accurate. Scope does not, however, independently verify the reliability and accuracy of the information and data. Scope’s ratings, rating reports, rating opinions, or related research and credit opinions are provided ‘as is’ without any representation or warranty of any kind. In no circumstance shall Scope or its directors, officers, employees and other representatives be liable to any party for any direct, indirect, incidental or other damages, expenses of any kind, or losses arising from any use of Scope’s ratings, rating reports, rating opinions, related research or credit opinions. Ratings and other related credit opinions issued by Scope are, and have to be viewed by any party as, opinions on relative credit risk and not a statement of fact or recommendation to purchase, hold or sell securities. Past performance does not necessarily predict future results. Any report issued by Scope is not a prospectus or similar document related to a debt security or issuing entity. Scope issues credit ratings and related research and opinions with the understanding and expectation that parties using them will assess independently the suitability of each security for investment or transaction purposes. Scope’s credit ratings address relative credit risk, they do not address other risks such as market, liquidity, legal, or volatility. The information and data included herein is protected by copyright and other laws. To reproduce, transmit, transfer, disseminate, translate, resell, or store for subsequent use for any such purpose the information and data contained herein, contact Scope Ratings GmbH at Lennéstraße 5 D-10785 Berlin.