KBRA Assigns Preliminary Ratings to Golub Capital Partners ABS Funding 2022-1

KBRA assigns preliminary ratings to four classes of notes issued by Golub Capital Partners ABS Funding 2022-1 (GCPAF 2022-1), a securitization backed by a portfolio of recurring revenue and middle market corporate loans.

Golub Capital Partners ABS Funding 2022-1 (“GCPAF 2022-1”) is a loan securitization managed by GC Investment Management LLC (“GCIM” or the “Collateral Manager”), an investment adviser and affiliate of GC Advisors LLC (collectively, with these affiliates and other funds managed by them and their affiliates “Golub Capital”). The securitization consists of $75.0 million Class A-1-R variable funding notes, $200.0 million Class A-2A-R floating-rate notes, $17.5 million Class A-2B-R fixed-rate notes, $40.5 million Class B-R fixed-rate notes (collectively the “Notes”), $26.4 million Class A Subordinated Notes and $90.6 million Class B Subordinated Notes (collectively the “Subordinated Notes”). The notes will be collateralized by a $450.0 million portfolio of recurring revenue loans (“RRLs”) and middle market loans (“MMLs”). The CLO originally closed in September 2022. This transaction will reset the terms of the CLO, including the stated maturity, non-call period, reinvestment period, note interest rates and notional balances.

Golub Capital’s recurring revenue lending strategy focuses on first-lien senior secured loans to business-to-business software and health care service companies with a minimum level of recurring revenue and low loan-to-value ratios. Despite the low level of earnings, the obligors in the portfolio usually have strong liquidity profiles and loan covenants. The overall K-WARF of the portfolio is 3461, which represents a weighted average portfolio assessment around B-. The portfolio presented to KBRA contains exposures to 59 obligors with 56.5% of the par exposed to the RRLs.

GC Investment Management LLC is an investment adviser established in 2010. GCIM is a USVI company providing investment management, fund accounting, operational and administrative services to manage certain of Golub Capital’s offshore funds. Through services agreements, the collateral manager will leverage the Golub Capital platform, including its investment professionals and other resources. Founded in 1994, Golub Capital has over $70 billion in capital under management as of June 30, 2024 with over $55 billion in middle market direct lending and over $10 billion in broadly syndicated leveraged loans.

KBRA’s preliminary ratings on the Class A-1-R, Class A-2A-R, Class A-2B-R, and Class B-R notes considers timely payment of interest and ultimate payment of principal by the applicable stated maturity date.

To access ratings and relevant documents, click here.

Click here to view the report.

Methodologies

• Structured Credit: Structured Credit Global Rating Methodology
• Structured Finance: Global Structured Finance Counterparty Methodology
• ESG Global Rating Methodology

Disclosures

Further information on key credit considerations, sensitivity analyses that consider what factors can affect these credit ratings and how they could lead to an upgrade or a downgrade, and ESG factors (where they are a key driver behind the change to the credit rating or rating outlook) can be found in the full rating report referenced above.

A description of all substantially material sources that were used to prepare the credit rating and information on the methodology(ies) (inclusive of any material models and sensitivity analyses of the relevant key rating assumptions, as applicable) used in determining the credit rating is available in the Information Disclosure Form(s) located here.

Information on the meaning of each rating category can be located here.

Further disclosures relating to this rating action are available in the Information Disclosure Form(s) referenced above. Additional information regarding KBRA policies, methodologies, rating scales and disclosures are available at www.kbra.com.

About KBRA

Kroll Bond Rating Agency, LLC (KBRA) is a full-service credit rating agency registered with the U.S. Securities and Exchange Commission as an NRSRO. Kroll Bond Rating Agency Europe Limited is registered as a CRA with the European Securities and Markets Authority. Kroll Bond Rating Agency UK Limited is registered as a CRA with the UK Financial Conduct Authority. In addition, KBRA is designated as a designated rating organization by the Ontario Securities Commission for issuers of asset-backed securities to file a short form prospectus or shelf prospectus. KBRA is also recognized by the National Association of Insurance Commissioners as a Credit Rating Provider.

Doc ID: 1006826

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