Silver Arrow China 2016-2: 19 November 2016

This transaction will be the second static cash securitisation of retail auto loans to be extended by Mercedes-Benz Auto Finance Ltd to individual obligors in China.

Eligibility criteria (includes): the receivables are denominated in RMB; has been originated by the Originator pursuant to a Loan Agreement governed by PRC Law; each Obligor is a resident of the PRC; the Financed Vehicles are classified as Mercedes-Benz or smart passenger cars or vans by MBAFC; monthly instalment payments; the interest rate is fixed; has a seasoning above or equal to one month; each receivable requires the obligor to maintain insurance on the financed vehicle.

At the cut-off the portfolio consisted of 28,040 fixed-rate loans (advanced to 28,025 borrowers) for the purchase of new vehicles, where the average outstanding principal balance per borrower is Rmb169,956 and the highest is for Rmb1.282mln. Type of credit (by principal outstanding): non-balloon 99.91%, balloon 0.09%. The WA LTV ratio at origination was 62.96% and the WA seasoning is 10.72 months.

Risk retention: On the Issue Date, MBAFC plans to hold 100% of the Subordinated Notes, the size of which is at least 5% of the total issuance size. The associated economic risks relating to 100% of the Subordinated Notes will be assumed by MBAFC. The holding period will be no shorter than the tenor of the relevant Notes.

Compare/contrast: Silver Arrow China 2016-1, Driver Japan Six