Fitch Ratings has taken various rating actions on CNH Equipment Trusts 2011-B and 2014-A as follows:
CNH 2011-B
Class A-4 affirmed at 'AAAsf'; Outlook Stable;
Class B affirmed at 'AAAsf'; Outlook Stable.
CNH 2014-A
Class A-2 affirmed at 'AAAsf'; Outlook Stable;
Class A-3 affirmed at 'AAAsf'; Outlook Stable;
Class A-4 affirmed at 'AAAsf'; Outlook Stable;
Class B affirmed at 'Asf'; Outlook revised to Positive from Stable.
KEY RATING DRIVERS
The affirmation of the class A notes in both transactions and the class B notes in 2011-B reflects loss coverage levels consistent with the current ratings. The Outlook, , maintained at Stable for the above mentioned notes, reflects Fitch's expectation for loss coverage and credit enhancement (CE) to continue to improve as the transactions amortize. As of the December 2014 reporting period, cumulative net losses totaled 16 basis points (bps) and 1 bp for 2011-B and 2014-A, respectively. Both transactions' forecasts are below Fitch's initial base case loss proxies.
The Outlook revision to Positive for the 2014-A class B notes reflects Fitch's expectation for loss coverage and CE to continue to improve as the transaction amortizes. It also reflects the possibility for positive rating actions in the next 12 to 18 months.
RATING SENSITIVITY
Unanticipated increases in the frequency of defaults and loss severity could produce loss levels higher than the current projected base case loss proxies which would impact available loss coverage. Lower loss coverage could affect ratings and Outlooks, depending on the extent of the decline in coverage. In Fitch's initial review of the transactions, the notes were found to have limited sensitivity to 1.5x and 2.5x higher of Fitch's base case loss expectations. Initial key rating drivers and rating sensitivities are further described in the presale reports dated Sept. 12, 2011 for 2011-B and Feb. 10, 2014 for 2014-A.
To date, the transactions have exhibited strong performance with losses well within Fitch's initial expectations with rising loss coverage and multiple levels. As such, continued strong performance for these transactions would most likely result in further positive rating actions. Conversely, a material deterioration in performance would have to occur within the asset pools to have potential negative impact on the outstanding ratings.
Fitch's analysis of the Representations and Warranties (R&W) for the 2014-A transaction can be found in 'CNH Equipment Trusts 2014-A - Appendix'. These R&W are compared to those of typical R&W for the asset class as detailed in the special report 'Representations, Warranties, and Enforcement Mechanisms in Global Structured Finance Transactions' dated Oct. 31, 2014.
Additional information is available at 'www.fitchratings.com'.
Applicable Criteria and Related Research:
--'Criteria for Rating U.S. Equipment Lease and Loan ABS' (Dec. 23, 2014);
--'Global Structured Finance Rating Criteria' (Aug. 4, 2014);
--'Representations, Warranties, and Enforcement Mechanisms in Global Structured Finance Transactions' (Oct. 31, 2014);
--'CNH Equipment Trusts 2011-B' (Sept. 12, 2011);
--'CNH Equipment Trusts 2014-A' (Feb. 10, 2014);
--'CNH Equipment Trusts 2014-A - Appendix' (Feb. 10, 2014).
Applicable Criteria and Related Research:
CNH Equipment Trust 2014-A (US ABS)
http://www.fitchratings.com/creditdesk/reports/report_frame.cfm?rpt_id=735381
CNH Equipment Trust 2014-A -- Appendix
http://www.fitchratings.com/creditdesk/reports/report_frame.cfm?rpt_id=735418
Representations, Warranties and Enforcement Mechanisms in Global Structured Finance Transactions
http://www.fitchratings.com/creditdesk/reports/report_frame.cfm?rpt_id=799248
Global Structured Finance Rating Criteria
http://www.fitchratings.com/creditdesk/reports/report_frame.cfm?rpt_id=754389
Additional Disclosure
Solicitation Status
http://www.fitchratings.com/gws/en/disclosure/solicitation?pr_id=971355
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