OREANDA-NEWS. S&P Global Ratings today assigned its ratings to Dell Equipment Finance Trust 2016-1's $908.997 million notes series 2016-1 (see list).

The note issuance is asset-backed securities transaction backed by equipment leases and loans.

The ratings reflect our view of:The availability of 19.65%, 16.25%, 12.30%, and 8.25% initial hard credit support for the class A, B, C, and D notes, respectively. The hard credit support includes a cash reserve, funded at closing, equal to 1% of the initial aggregate discounted contract balance, and that is subject to a floor of the same amount. The availability of approximately 1.74% annual excess spread based on the unstressed estimate. An overcollateralization target mechanism (a target level of 10.90% of the current discounted contract balance and a floor of 7.00% of the initial discounted contract balance) that results in relatively little credit enhancement releasing to the seller in our stressed cash flow modeling scenarios. The transaction's ability to withstand elevated losses in a moderate stress scenario, which includes several top obligors defaulting and flow losses above what we projected in the base case before becoming vulnerable to a downgrade. The timely interest and principal payments made under stressed cash flow modeling scenarios, which we believe are appropriate for the ratings. The pool's collateral characteristics, including the relatively short weighted average original terms (40 months), weighted average seasoning of approximately eight months, that eight of the top obligor concentrations each exceed 1.50%, the low (below 3%) concentration of contracts from Dell Financial Services' (DFS) small business segment, and the high (approximately 60.5%) concentration of contracts from DFS's public and large enterprise (PLE) segment. The obligors in the PLE segment tend to be large high-credit-quality corporate and public entities. DFS's servicing experience. This is DFS's fourth stand-alone term securitization. In addition, its contracts were part of several CIT Group-sponsored small-ticket equipment transactions that we rated in the early-to-mid 2000s. Also, DFS maintains and services conduit securitized funding facilities that have been in place for years. The backup servicer, Wells Fargo Bank N. A.The transaction's legal structure.