Prestige Financial Services Inc. has established a $150 million asset-backed commercial paper conduit facility through JPMorgan Chase Bank N.A. in Chicago.
Prestige said the new arrangement, which has a renewable one-year term, provides a substantial and committed source of liquidity to fund the Salt Lake City-based auto finance company’s consumer lending activities.
In some ways similar to a secured line of credit from a bank, a conduit facility aggregates installment receivables which, in turn, back short-term commercial paper sold to institutional investors. This funding source allows lenders to methodically build their portfolios toward the higher volumes required for asset-backed securitization, which is a longer-term arrangement through which large pools of receivables are financed in bulk through the capital markets.
“The competitive structure and outstanding pricing we achieved on this transaction owe to several factors,” said Prestige’s Chief Operating Officer Bryant Henrie. “Foremost among them are the valued, long-standing relationship between J.P. Morgan and Prestige’s parent, the Larry H. Miller Group of Companies, as well as our proven track record in originating and servicing subprime auto loans.”
Now in its 17th year of operations, Prestige Financial provides consumer financing solutions for dealerships both within and outside of the Miller Group, the nation’s 10th-largest auto retailer. Prestige manages a $440 million portfolio.