3 Rating Actions Taken on Leasing Receivables Funding LLC Transactions

We [S&P Global Ratings] raised our ratings on three classes and affirmed our ratings on nine classes from the transactions.

NEW YORK (S&P Global Ratings) Nov. 12, 2021--S&P Global Ratings today raised its ratings on three classes from GreatAmerica Leasing Receivables Funding LLC' s series 2018-1, 2019-1, and 2020-1 transactions. At the same time, we affirmed our ratings on nine classes from the transactions (see list on S&P site).

Today's rating actions reflect each transaction's collateral performance to date, expected future collateral performance, structure, and credit enhancement. Additionally, we incorporated secondary credit factors, including credit stability, payment priorities under various scenarios, and sector- and issuer-specific analyses. Considering these factors, we believe the creditworthiness of the notes remains consistent with the raised and affirmed ratings.

Each transaction continues to perform better than our initial lifetime cumulative net loss (CNL) ranges, partly because our initial ranges accounted for stressed recovery rates (of about 10%) along with other factors. As a result, we had lowered our CNL range for series 2018-1 to 1.20%-1.30% and for series 2019-1 to 1.45% to 1.65% in October 2020. We are now lowering our CNL range to no more than 0.95% for series 2018-1, to 1.00%-1.20% for series
2019-1, and to 1.35%-1.55% for series 2020-1 (see tables 1 and 2).

Our stressed loss level for each pool considers obligor concentrations. Each individual obligor concentration is below 1.50% of the pool balance--the threshold level we generally focus on to begin incorporating obligor default risk into our stressed loss analysis. Therefore, we have not included top obligor defaults in our stressed loss analysis as an additive factor to the flow level of losses. We also considered the supplemental largest-obligor default test. However, given the low obligor concentrations, the total hard credit enhancement in each pool can cover many top obligor concentrations.