Consumer Portfolio Services (Nasdaq: CPSS) closed a $514.07 million senior subordinate asset-backed securitization on April 22, 2026.
The transaction securitized $526.17 million of automobile receivables, is the company’s largest securitization and the first above $500 million, and the senior class received Aaa/AAA ratings.
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Positive
Largest securitization in company history: $514.07 million of notes
Senior class received dual Aaa/AAA ratings from Moody’s and DBRS
Weighted average coupon on notes approximately 5.51%
Initial credit enhancement: 1.00% cash deposit plus 2.30% overcollateralization
Negative
Lower tranches carry weaker ratings (Class D Baa2/BBB, Class E BB)
Class E pays higher coupon of 7.14%, indicating greater credit risk
Transaction requires accelerated principal to reach OC target of 7.70% or 19.20% outstanding
News Market Reaction – CPSS
+1.05%
+1.05%Session close to close
In the Apr 22 session, CPSS gained 1.05%, reflecting a mild positive market reaction.
This announcement details CPS’s largest securitization to date, with $514.07 million of asset-backed...
Analysis
This announcement details CPS’s largest securitization to date, with $514.07 million of asset-backed notes supported by $526.17 million in auto receivables and initial credit enhancement via a 1.00% cash reserve and 2.30% overcollateralization. The deal continues a long securitization track record and follows earlier 2026 funding actions. Investors may watch future securitization volumes, credit performance of the receivables, and how these structures interact with CPS’s broader leverage and funding mix.
Key Figures
Notes sold:$514.07 millionReceivables pool:$526.17 millionWeighted average coupon:5.51%+5 more
8 metrics
Notes sold$514.07 millionAsset-backed notes purchased by qualified institutional buyers
Receivables pool$526.17 millionAutomobile receivables securing CPS Auto Receivables Trust 2026-B
Weighted average coupon5.51%Weighted average coupon on 2026-B notes
Cash reserve1.00%Initial cash deposit as percent of original receivable pool balance
Initial overcollateralization2.30%Initial overcollateralization on 2026-B transaction
Target OC (original pool)7.70%Maximum target overcollateralization of original receivable pool balance
Target OC (outstanding pool)19.20%Alternative target overcollateralization of then outstanding pool balance
Historical securitizations109 transactionsTotal securitizations in company history; 59 senior subordinate since 2011
Completed $345.61M senior subordinate ABS backed by auto receivables.
24h Move is the share-price change in the day after each event; other market factors may also have contributed.
Pattern Detected
Funding and securitization updates have often coincided with flat or negative next-day moves, even when operational news skewed positive.
Recent Company History
Recent news shows CPS steadily expanding funding capacity and securitization activity. On Jan 27, 2026, it closed a $345.61 million senior subordinate securitization backed by $352.66 million in receivables, followed by a $50.0 million residual interests deal on Mar 4, 2026. Earnings on Mar 10, 2026 highlighted $434.5 million in 2025 revenue and $19.33 million net income. A warehouse capacity increase to $390 million was announced in early April, framing today’s larger 2026-B securitization as part of a consistent funding build-out.
Key Terms
asset-backed securitization, asset-backed notes, overcollateralization, credit enhancement, +4 more
8 terms
asset-backed securitizationfinancial
"CPS Announces $514.07 Million Senior Subordinate Asset-Backed Securitization"
Asset-backed securitization is a process where a financial institution pools together a group of assets—such as loans or receivables—and converts them into a security that can be sold to investors. This allows the original lender to raise funds quickly, while investors gain access to a stream of payments derived from the underlying assets. It’s similar to bundling multiple small income sources into a single investment, providing both liquidity for lenders and investment opportunities for others.
asset-backed notesfinancial
"purchased $514.07 million of asset-backed notes secured by $526.17 million in"
Asset-backed notes are investment papers that pay investors from the income produced by a pooled set of assets, such as loans, leases, or receivables. Think of buying a slice of a fruit basket where your returns come from sales of the fruit; the value and safety of the notes depend on how healthy the underlying assets are and how the payments are prioritized, so investors watch expected returns, default risk and liquidity closely.
overcollateralizationfinancial
"initial credit enhancement consisting of a cash deposit ... and overcollateralization of 2.30%"
Overcollateralization is the practice of pledging assets worth more than the amount of debt they secure, creating a built-in safety cushion for lenders or bond investors if the underlying assets lose value. Think of it like leaving a larger-than-required security deposit: it lowers the chance investors suffer losses, can improve credit ratings, and usually means lower yields or stricter terms for borrowers because the investment is safer.
credit enhancementfinancial
"The 2026-B transaction has initial credit enhancement consisting of a cash deposit"
Credit enhancement is a set of tools or arrangements—such as guarantees, insurance, reserve funds, or priority of payments—designed to reduce the chance lenders or bondholders lose money if a borrower defaults. Investors care because these measures make a debt issue look safer and can raise its credit rating; like a co-signer or loan insurance, credit enhancement typically lowers the yield an issuer must pay but also reduces the investor’s risk.
qualified institutional buyersfinancial
"In the transaction, qualified institutional buyers purchased $514.07 million of"
Qualified institutional buyers are large organizations, like big investment firms or banks, that are allowed to buy certain types of investment opportunities not available to everyday investors. Their size and experience matter because it ensures they understand and can handle complex financial deals, making markets more efficient and secure.
private offeringregulatory
"The transaction was a private offering of securities, not registered under"
A private offering is the sale of securities—such as shares or bonds—directly to a limited group of investors rather than through public markets or a broad auction. It matters to investors because it changes who owns the company and how much cash the business has available, which can dilute existing shareholders, affect share liquidity and price discovery, and signal strategic moves or funding needs; think of it as selling a batch of goods to a few trusted customers instead of opening a shop to everyone.
senior class of notesfinancial
"triple “A” rating from at least two rating agencies on the senior class of notes"
A senior class of notes is a group of debt securities that get paid before other debts if a borrower faces trouble or insolvency, giving holders a higher claim on the borrower’s cash and assets. For investors this usually means lower risk and typically lower interest rates compared with junior debt, much like standing at the front of a line to be paid first after a business winds down.
credit enhancementfinancial
"accelerated payment of principal on the notes to reach overcollateralization"
Credit enhancement is a set of tools or arrangements—such as guarantees, insurance, reserve funds, or priority of payments—designed to reduce the chance lenders or bondholders lose money if a borrower defaults. Investors care because these measures make a debt issue look safer and can raise its credit rating; like a co-signer or loan insurance, credit enhancement typically lowers the yield an issuer must pay but also reduces the investor’s risk.
LAS VEGAS, April 22, 2026 (GLOBE NEWSWIRE) -- Consumer Portfolio Services, Inc. (Nasdaq: CPSS) (“CPS” or the “Company”) announced the closing of its second term securitization in 2026 on Wednesday April 22, 2026. The transaction is CPS's 59th senior subordinate securitization since the beginning of 2011 and the 42nd consecutive securitization to receive a triple “A” rating from at least two rating agencies on the senior class of notes.
In the transaction, qualified institutional buyers purchased $514.07 million of asset-backed notes secured by $526.17 million in automobile receivables originated by CPS. The sold notes, issued by CPS Auto Receivables Trust 2026-B, consist of five classes. Ratings of the notes were provided by Moody’s and DBRS Morningstar, and were based on the structure of the transaction, the historical performance of similar receivables and CPS’s experience as a servicer. This transaction is the largest of the 109 securitizations in the company’s history and marks the first transaction of over $500 million of notes sold.
Note Class
Amount (in millions)
Interest Rate
Average Life (years)
Price
Moody’s Rating
DBRS Rating
A
$237.620
4.35%
0.68
99.99986%
Aaa
AAA
B
$76.400
4.59%
1.81
99.98841%
Aaa
AA
C
$78.660
4.93%
2.52
99.98836%
Aa3
A
D
$48.670
5.20%
3.30
99.98141%
Baa2
BBB
E
$72.720
7.14%
4.04
99.96652%
NR
BB
The weighted average coupon on the notes is approximately 5.51%.
The 2026-B transaction has initial credit enhancement consisting of a cash deposit equal to 1.00% of the original receivable pool balance and overcollateralization of 2.30%. The transaction agreements require accelerated payment of principal on the notes to reach overcollateralization of the lesser of 7.70% of the original receivable pool balance, or 19.20% of the then outstanding pool balance.
The transaction was a private offering of securities, not registered under the Securities Act of 1933, or any state securities law. All such securities having been sold, this announcement of their sale appears as a matter of record only.
About Consumer Portfolio Services, Inc.
Consumer Portfolio Services, Inc. is an independent specialty finance company that provides indirect automobile financing to individuals with past credit problems or limited credit histories. We purchase retail installment sales contracts primarily from franchised automobile dealerships secured by late model used vehicles and, to a lesser extent, new vehicles. We fund these contract purchases on a long-term basis primarily through the securitization markets and service the contracts over their lives.
Investor Relations Contact
Danny Bharwani, Chief Financial Officer 949-753-6811
FAQ
What did CPSS announce on April 22, 2026 regarding securitization?
CPSS closed a $514.07 million senior subordinate securitization on April 22, 2026. According to Consumer Portfolio Services, the deal securitized $526.17 million of automobile receivables and is the company’s largest securitization to date.
What ratings did the CPSS Auto Receivables Trust 2026-B senior notes receive (CPSS)?
The senior class received Aaa from Moody’s and AAA from DBRS. According to Consumer Portfolio Services, ratings reflect the transaction structure, historical receivable performance, and CPS’s servicing experience.
What are the key structural credit enhancements for the CPSS 2026-B deal?
Initial credit enhancement includes a 1.00% cash reserve and 2.30% overcollateralization. According to Consumer Portfolio Services, the agreements also require accelerated principal to reach specified OC targets (7.70% original or 19.20% then outstanding).
How are the CPSS 2026-B note classes priced and what are their coupons?
Note classes were issued at prices near par with a weighted average coupon of 5.51%. According to Consumer Portfolio Services, individual class coupons range from 4.35% (Class A) to 7.14% (Class E).
Is the CPSS securitization offering registered under the Securities Act?
No, the offering was a private placement and not registered under the Securities Act of 1933. According to Consumer Portfolio Services, all securities were sold privately and this announcement is a record of the sale.
