By Mary-Katherine Stinson
Lexington, Ky., Feb. 16 – Frontier Securitization XXXVII Ltd. issued $300 million of class 2A secured floating-rate social notes due March 2029 (Fitch (Hong Kong): AAA) at par, according to a prospectus and a related press release.
The class A2 notes are limited recourse obligations of the issuer and are secured by, among other things, a $300 million class A2 floating-rate bond due 2029 issued to the note issuer by Challenger XXXVII Securitization Specialty Co., Ltd., which is indirectly backed by a pool of credit card receivables originated by Samsung Card Co., Ltd.
The notes will bear interest at SOFR plus 92 basis points.
The transaction features a 43-month revolving period up to Aug. 31, 2027 if no early amortization events occur. There are scheduled amortization payments of $50 million scheduled to start in October 2027.
The expected maturity date is March 2028, but if funds are not sufficient for the redemption at that time then the redemption will occur on the notes’ legal maturity date of March 2029.
DBS Bank Ltd. is the lead manager.
The total proceeds of the class A2 notes offering will be used by the note issuer to purchase the class A2 bond from the bond issuer. The bond issuer will use the proceeds of the issue of the class A1 bond and the class A2 bond to subscribe for a KRW 806.1 billion interest in the assets of a trust established Jan. 16.
Samsung Card will use the net proceeds to finance and/or refinance investments in projects which meet some eligibility criteria under the originator’s sustainable financing framework, specifically, in the category of access to essential services.
A second party opinion was obtained from Sustainalytics on Feb. 25, 2021.
Based in Seoul, Samsung Card is a South Korean credit card company.
| Issuer: | Frontier Securitization XXXVII Ltd.
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| Originator: | Samsung Card Co., Ltd.
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| Amount: | $300 million
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| Issue: | Floating-rate social notes
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| Maturity: | March 2029
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| Lead manager: | DBS Bank Ltd.
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| Trustee: | Citicorp International Ltd.
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| Counsel to issuer: | Walkers (Hong Kong) (Cayman Islands law)
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| Counsel to underwriters: | Tiang & Partners (English law) and Shin & Kim (Korean law)
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| Counsel to the originator: | Lee & Ko (Korean law)
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| Second party opinion: | Sustainalytics
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| Coupon: | SOFR plus 92 bps
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| Price: | Par
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| Yield: | SOFR plus 92 bps
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| Call features: | Non-callable
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| Trade date: | Feb. 15
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| Ratings: | Fitch (Hong Kong) Ltd: AAA
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| Distribution: | Regulation S
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| ISIN: | XS2748209850
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