Sunbit, an entity that develops technology for point-of-sale lending and other financial services, has accomplished its first asset-backed securitisation (ABS) valued at USD 200 million. The senior tranche of the notes received an AA rating.
Details of the Deal
The fixed yield for these notes is set at 5.713%, with a two-year revolving feature included to cater to future funding needs. Citibank was appointed as the sole structuring agent and joint lead bookrunner, while J.P. Morgan and ATLAS SP Partners were named as joint lead bookrunners.
Enhanced Funding Capacity
Combining this ABS deal with Sunbit’s existing warehouse facilities brings the company’s total funding capacity to over USD 1.5 billion, an increase from its pre-existing capacity of more than one billion dollars. More than 25 institutional investors participated in this transaction, including insurance companies, asset managers, and hedge funds.
Recent Growth and Future Expectations
Sunbit experienced a series of positive operating income over the past three quarters and recorded a 35% year-over-year revenue growth. Management decided to enter the ABS market due to its stable profitability and ongoing expansion plans. The deal is expected to provide Sunbit with broader access to institutional investors at fixed rates, along with enhanced funding capacity for its existing portfolio of over four and a half million transactions.
Furthermore, Sunbit saw a 100% quarter-over-quarter increase in gross merchandise volume through its Stripe partnership for point-of-sale financing. The company anticipates an 80% annual rise in co-branded credit card receivables.
Comprehensive Due Diligence
The transaction underwent thorough due diligence by independent rating agencies, which assessed Sunbit’s credit performance, operational procedures, and financial reporting. Company officials noted that the process highlighted the transparency and operational controls necessary for involvement in institutional capital markets.
Sunbit’s offerings include fee-free credit cards for major retailers and a buy now, pay later solution available at most U.S. auto dealership service centers. The company also provides financing options for dental services.
