World Omni ditched term SOFR tranche in latest ABS

Toyota deal drew ARRC’s ire, but some bankers still see a case for using term SOFR in auto ABS


An auto finance company dropped plans to include a floating rate tranche linked to a term version of the secured overnight financing rate, or SOFR, in its latest securitisation after underwriting banks got cold feet about the idea, which has since drawn the ire of the Federal Reserve-backed group tasked with ushering US markets away from Libor.

World Omni, a captive finance provider to 177 Toyota dealers in the US, issued $1 billion of debt backed by auto receivables on November 7. Pre-sale

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