#United States #Credit Cards #Continental Finance #Securitization #Wilmington, Delaware

Continental Finance Company Secures $550 Million in Credit Card Securitization

On December 5, 2024, Continental Finance Company, LLC, known for its innovative marketing and servicing of credit cards aimed at the near-prime market, announced the successful issuance of $550 million in credit card asset-backed securities. This significant financial maneuver marks the company's seventh term securitization and is notable for being their largest to date.

The newly issued securities, branded as Series 2024-A notes, are part of the Continental Finance master trust, CFCCMT. This transaction involved five classes of fixed-rate notes, with ratings assigned by Kroll Bond Rating Agency (KBRA) as AA-, A-, BBB, BB, and B, respectively. The securitization was led by ATLAS SP with JP Morgan and Piper Sandler serving as co-managers, reflecting the strong market interest in these financial products.

Strong Investor Demand

Steve McSorley, President of Continental Finance, expressed enthusiasm over the response from investors, stating, "The amount of investor demand for the Series 2024-A notes issued out of the company's master trust was met with incredible enthusiasm." This overwhelming interest not only led to an upsizing of the transaction but also highlighted the securities' multiple times oversubscription, which signifies strong market confidence in Continental Finance's strategy and outlook.

This transaction affirms the robustness of Continental Finance's securitization program, which has developed a solid reputation for providing investors with quality financial instruments. According to McSorley, this was the company’s largest securitization yet, with several first-time investors participating in the program. The company has significantly broadened its access to the capital markets, which in turn empowers it to enhance its comprehensive marketing and servicing platform to better serve its consumers.

Commitment to Customer Support

Brett Landrum, Chief Financial Officer of CFC, emphasized the essential nature of their product offerings to customers, noting that those with near-prime credit often rely on their cards for recurring transactions such as retail, gas, and groceries. This reliance leads to resilient consumer behavior even during economic downturns. Landrum stated, "Our disciplined lending strategy and focus on providing best-in-class customer support have positioned our company to provide long-term value to our investors. We are committed to supporting our customers, particularly in this underserved segment of the American consumer market."

Since its inception in 2005, Continental Finance Company has championed the near-prime market, serving over 5.3 million credit card accounts. The company's strategic focus involves providing innovative and responsible credit solutions to consumers with less-than-perfect credit, thereby promoting financial literacy and responsible credit management.

Looking Forward

Continental Finance continues to prioritize creating trust and value in the eyes of its consumers. The company aims to establish itself firmly within the credit card industry by gaining customer loyalty and striving to be their lifelong provider. As they advance, the company plans to uphold its mission of delivering exceptional service and competitive products which appeal to the needs of consumers navigating their credit journeys.

This recent securitization effort not only showcases the financial health and operational capability of Continental Finance but also reinforces a commitment to innovation and user-centered financial services.

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