World Financial Network Credit Card Master Note Trust Series 2019-A Notes Assigned Preliminary Ratings

  • World Financial Network Credit Card Master Note Trust's issuance is an ABS transaction backed by a collateral certificate representing an ownership interest in the receivables held by World Financial Network Credit Card Master Trust. The receivables are generated under consumer credit card accounts originated through various merchant agreements.
  • We assigned our preliminary ratings to the class A, M, and B notes.
  • The preliminary ratings reflect our view of the transaction's credit support and payment structure, and the collateral pool's credit risk, among other factors.
 
NEW YORK (S&P Global Ratings) Feb. 11, 2019--S&P Global Ratings today assigned 
its preliminary ratings to World Financial Network Credit Card Master Note 
Trust's asset-backed notes series 2019-A (see list).

The note issuance is an asset-backed securities (ABS) transaction backed by a 
collateral certificate representing an ownership interest in the receivables 
held by World Financial Network Credit Card Master Trust. The receivables are 
generated under consumer credit card accounts originated through various 
merchant agreements.

The preliminary ratings are based on information as of Feb. 11, 2019. 
Subsequent information may result in the assignment of final ratings that 
differ from the preliminary ratings.

The preliminary ratings reflect: 
  • Our view that the credit support for each class of notes is sufficient to withstand the simultaneous stresses we apply to our 10.50% base-case loss rate assumption, our 14.50% base-case payment rate assumption, and our 25.25% base-case yield assumption for each preliminary rating category. In addition, we use stressed excess spread assumptions to determine if sufficient credit support is available for each preliminary rating category. Our purchase rate assumption for this transaction is zero. All of the stress assumptions outlined above are based on our current criteria (see "U.S. Credit Card Securitizations: Methodology And Assumptions" published Aug. 24, 2017.) The class A, M, and B notes are supported by 26.00%, 20.50%, and 16.75% subordination, respectively, as a percentage of series 2019-A's aggregate note balance.
  • Our view that the 4.00% minimum seller's interest (6.00% for November, December, and January) is sufficient in our stress scenarios to absorb dilutions, or noncash reductions, in the receivables.
  • Our expectation that under a moderate ('BBB') stress scenario, all else being equal, our ratings on the class A and M notes will remain within one rating category of the assigned preliminary 'AAA (sf)' and 'AA (sf)' ratings, respectively, in the next 12 months, and our rating on the class B notes will remain within two rating categories of our preliminary 'A+ (sf)' rating in the next 12 months, based on our credit stability criteria (see "Methodology: Credit Stability Criteria," published May 3, 2010).
  • Our view of the credit risk inherent in the collateral loan pool based on our economic forecast, the trust portfolio's historical performance, and the collateral's characteristics.
  • Our view of Comenity Bank's (Comenity; not rated) servicing experience, Comenity Servicing LLC's experience as a subservicer, and our opinion of the quality and consistency of Comenity's account origination, underwriting, account management, collections, and general operational practices. Comenity is a wholly owned subsidiary of Alliance Data Systems Corp.
  • Our expectation for the timely interest and ultimate principal payments by the legal maturity date based on stressed cash flow modeling scenarios using assumptions that are commensurate with the assigned preliminary ratings.
  • The transaction's underlying payment structure, cash flow mechanics, and legal structure.
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