Fitch Upgrades One and Affirms Four Classes of CarMax Auto Owner Trust 2014-4
KEY RATING DRIVERS
The rating upgrades and affirmations are based on available credit enhancement (CE) and loss performance. The collateral pool continues to perform within Fitch's expectations. Based on the current structure and CE, the securities are able to withstand stress scenarios consistent with the assigned ratings and make full payments to investors in accordance with the terms of the documents.
The ratings reflect the quality of CarMax Business Services, LLC's retail auto loan originations, the strength of its servicing capabilities, and the sound financial and legal structure of the transactions.
Unanticipated increases in the frequency of defaults and loss severity could produce loss levels higher than the current projected base case loss proxy and impact available loss coverage and multiples levels for the transaction. Lower loss coverage could also impact ratings and Rating Outlooks, depending on the extent of the decline in coverage.
In Fitch's initial review of the transaction, the notes were found to have limited sensitivity to a 1.5x and 2.5x increase of Fitch's base case loss expectation. To date, the transaction has exhibited strong performance with losses well within Fitch's initial expectations with rising loss coverage and multiple levels. Therefore, a material deterioration in performance would have to occur within the asset pool to have potential negative impact on the outstanding ratings.
USE OF THIRD-PARTY DUE DILIGENCE PURSUANT TO SEC RULE 17G-10
Form ABS Due Diligence-15E was not provided to, or reviewed by, Fitch in relation to this rating action.
Fitch has taken the following rating actions:
CarMax Auto Owner Trust 2014-4
--Class A-3 affirmed at 'AAAsf'; Outlook Stable;
--Class A-4 affirmed at 'AAAsf'; Outlook Stable;
--Class B upgraded to 'AAAsf' from 'AAsf'; Outlook revised to Stable from Positive;
--Class C affirmed at 'Asf'; Outlook Positive;
--Class D affirmed at 'BBBsf'; Outlook Stable.