KBRA assigns preliminary ratings to five classes of notes issued by NMEF Funding 2023-A, LLC (NMEF 2023-A), an equipment ABS. NMEF 2023-A represents North Mill Equipment Finance LLC’s (North Mill) seventh equipment ABS. North Mill is an independent equipment finance company created in 2012 when Colford Capital Holdings LLC acquired and re-branded Equilease Financial Services, which had been founded in 1957. InterVest Capital Partners Inc. (formerly Wafra Capital Partners Inc.) subsequently acquired North Mill from Colford Capital Holdings LLC in August 2018.

NMEF 2023-A is backed by a pool of equipment loans and leases (Equipment Contracts). The statistical discounted pool balance (Statistical Pool) totals $388.65 million and represents the projected cash flows of the Equipment Contracts discounted at a rate of 8.25%. As of the initial cutoff date, the discounted contract value will be at least $388.65 million and the initial pool characteristics are expected to be substantially similar to the Statistical Pool. The total collateral may increase by up to $68.59 million (15% of the collateral balance) through the addition of Equipment Contracts during the three-month prefunding period (Prefunding Period). NMEF 2023-A will issue five classes of notes, including a short-term tranche. Credit enhancement includes a reserve account, overcollateralization (O/C) and subordination for senior classes. The O/C is subject to a target equal to 18.25% of the current pool balance and a floor equal to 0.50% of the initial pool balance, accounting for any prefunding that occurs. The reserve account is funded at 1.00% of the initial pool balance, including the maximum amount of prefunding, and is non-amortizing.

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Related Publications

• Equipment Lease & Loan Global ABS Methodology
• Global Structured Finance Counterparty Methodology
• ESG Global Rating Methodology

Disclosures

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