Eleven Ratings Raised, One Affirmed On Three Series From OneMain Financial Issuance Trust And Springleaf Funding Trust

OVERVIEW
  • We reviewed OneMain Financial Issuance Trust's (OMFIT's) 2015-1 and 2016-2 issuances and Springleaf Funding Trust's (SLFT's) 2015-A issuance, which are backed by personal consumer loan receivables.
  • We raised our ratings on the class B, C, and D notes from OMFIT's series 2015-1 and on the class A, B, C, and D notes from OMFIT's series 2016-2 and SLFT's series 2015-A.
  • We affirmed our ratings on the class A notes from OMFIT's series 2015-1.
  • The rating actions reflect collateral performance to date, our views regarding future collateral performance, and each transaction's structure and credit enhancement, among other factors.
NEW YORK (S&P Global Ratings) Dec. 6, 2018--S&P Global Ratings today raised 
its ratings on 11 classes and affirmed its ratings on one class from OneMain 
Financial Issuance Trust's (OMFIT's) series 2015-1 and 2016-2 and Springleaf 
Funding Trust (SLFT's) series 2015-A (see list).

The rating actions reflect collateral performance to date and our expectations 
regarding future collateral performance, as well as each transaction's 
structure and credit enhancement. Our analysis also incorporated secondary 
credit factors, including credit stability, payment priorities under various 
scenarios, and sector- and issuer-specific analyses. Considering all of these 
factors, we believe the notes' creditworthiness is consistent with the raised 
and affirmed rating levels.

All of the transactions were structured with revolving periods, and they have 
all entered scheduled amortization within the past 12 months: OMFIT 2015-1 on 
Dec. 31, 2017; OMFIT 2016-2 on Feb. 28, 2018; and SLFT 2015-A on Jan. 31, 
2018. During the revolving periods the pool concentrations for the three 
transactions migrated toward the weaker-performing risk levels as compared to 
the initial pools, though all remained within the concentration limits 
dictated by the transactions' structures. Our original base-case modelling 
assumed each pool would revolve to a worst-case composition; however, although 
weaker than the initial pool, the compositions have consistently been stronger 
than the worst-case concentrations and are reflected by each pool's loss 
performance. As of the November 2018 distribution date, the annualized 
three-month net loss percentages for OMFIT 2015-1 and 2016-2 were 9.96% and 
10.70%, respectively, while the annualized three-month net loss percentages 
for SLFT 2015-A was 9.37%. These are all well below the reinvestment criteria 
event triggers of 17.00% for each transaction. In our review, we considered 
the lower loss performance relative to our original base-case modelling 
assumptions.

Each OMFIT and SLFT transaction contains a sequential principal payment 
structure in which the notes are paid principal by seniority. The transactions 
also benefit from credit enhancement in the form of a nonamortizing reserve 
account, overcollateralization, subordination for the higher-rated tranches, 
and excess spread. Each transaction's hard credit enhancement is above the 
specified target or floor:

Hard Credit Support (%)
As of the November 2018 distribution date
                    
ONEMAIN FINANCIAL ISSUANCE TRUST

                       Total hard    Current total hard
                   credit support        credit support
Series     Class   at issuance(i)     (% of current)(i)
2015-1     A                36.12                 70.12
2015-1     B                27.17                 52.71
2015-1     C                21.95                 42.55
2015-1     D                12.50                 24.18

2016-2     A                38.95                 66.49
2016-2     B                28.18                 47.75
2016-2     C                19.99                 33.50
2016-2     D                12.64                 20.72


SPRINGLEAF FUNDING TRUST

                       Total hard    Current total hard
                   credit support        credit support
Series     Class   at issuance(i)     (% of current)(i)
2015-A     A                26.50                 54.17
2015-A     B                17.45                 35.67
2015-A     C                13.25                 27.08
2015-A     D                 8.00                 16.35

(i)Calculated as a percentage of the total gross receivables pool balance, 
consisting of a reserve account, overcollateralization, and subordination. 

We incorporated a cash flow analysis to assess the loss coverage level, giving 
credit to excess spread. Our various cash flow scenarios included 
forward-looking assumptions that we believe are appropriate given each 
transaction's performance to date. Aside from our break-even cash flow 
analysis, we also conducted sensitivity analyses for these series to determine 
the impact that a moderate ('BBB') stress scenario would have on our ratings 
if losses began trending higher than our base-case loss expectation.

The upgrades and affirmations reflect our view that the total credit support 
as a percentage of the pool balances, compared with our expectation of 
remaining losses, is commensurate with each raised and affirmed ratings. 

We will continue to monitor the performance of all of the outstanding 
transactions to ensure that the credit enhancement remains sufficient, in our 
view, to cover our net loss expectations under our stress scenarios for each 
of the rated classes.