Publicly owned independent finance company specializing in near-prime indirect auto loans to consumers on a nationwide basis
Issues -- Prior to the demise of the capital markets, the company had completed multiple securitizations in both the public and private markets. However as each securtitzation required an initial cash deposit, and a healthy level of over collateralization he company required significant additional funding in order to sustain its growth targets. Previously this growth capital had been provided through additional equity offerings.
Solution -- Woodcliff developed a proprietary cash flow model which after taking into account previous pool performance was able to more accurately project future cash flows on seasoned asset pools. The model was updated monthly using actual monthly pool performance to project future pool performance. This information provided the formula that was used to create a multi-year credit facility with a dynamic borrowing base.