DALLAS, Jan. 25, 2024 (GLOBE NEWSWIRE) -- Tricolor today announced a $271 million social bond – its third overall – to empower underserved, low-income communities and provide them with improved access to mainstream financing.
Barclays acted as the lead structuring agent with JPMorgan serving as Joint Bookrunner. The deal was rated by Kroll Bond Rating Agency and Moody’s and placed with a diversified mix of eighteen institutional investors in a private offering pursuant to Rule 144A under the Securities Act of 1933, as amended. The transaction was oversubscribed by 3.4X on the available classes; the Class E and Class F bonds were pre-placed.
Tricolor leverages artificial intelligence (AI) to successfully underwrite and extend affordable loans to credit invisible customers. By providing deserving people with access to reliable, affordable transportation and moving them into the financial mainstream, Tricolor aims to reverse systemic financial inequality in America. Investors are able to participate in this mission through these successful securitizations.
“Having effectively supported customers throughout an extraordinarily volatile macro environment the past four years, we could not have a stronger conviction that an integrated model is the most effective way to serve the needs of a low income population,” Daniel Chu, founder and CEO of Tricolor. “It is also evident that the most compelling and meaningful value proposition for this customer is the combination of affordable and realistic loan terms with a desirable and reliable vehicle. Looking ahead, we are keenly focused on advancing our customer-centric strategy in order to expand the path to a brighter future for the market we serve.”
The Tricolor Social Bond is collateralized with loans that provide affordable access to low-income borrowers with no FICO score for financing the purchase of a motor vehicle. Tricolor has secured a Second Party Opinion (“SPO”) from S&P Global Ratings to provide an opinion on the social benefits of this Framework as well as the alignment to the International Capital Markets Association (ICMA) Social Bond Principles.
Tricolor has now completed twelve well-received ABS transactions and is the only issuer in all of subprime auto ABS to be certified by the US Treasury as a Community Development Financial Institution (CDFI). The Company issued its first securitization in July 2013.
Meeting the Needs of Underserved Hispanics
The more than 59 million Hispanics in the United States would collectively rank as the eighth largest economy in the world. Yet, according to the FDIC National Survey of Unbanked and Underbanked Households, 32% of this US Hispanic population has no or limited access to mainstream credit.
Tricolor uses AI and nearly 16 years of proprietary customer insights and with over 40 million unique non-traditional credit attributes to unlock financially inclusive opportunities for low-income, credit invisible Hispanics left behind by mainstream financial providers. To date, Tricolor, a U.S. Department of the Treasury certified Community Development Financial Institution (CDFI), has disbursed over $2 billion in affordable auto loans as part of its mission to empower underserved Hispanics and provide them a path to a better future through both physical mobility and upward financial mobility.
Tricolor has been routinely recognized for its important work supporting consumers, including being named one of Inc. Magazine’s Best in Business and as the winner of Excellence in Financial Inclusion awards by both Finovate Awards and the LendIt Fintech Industry Awards.
This press release does not constitute an offer to sell or the solicitation of an offer to buy nor shall there be any sale of these securities in any jurisdiction in which such offer, solicitation or sale would be unlawful prior to registration or qualification under the securities laws of such jurisdiction.
For more information about Tricolor, please visit tricolorholdings.com and tricolor.com.
About Tricolor
Tricolor is a U.S. Department of the Treasury certified Community Development Financial Institution (CDFI) and a mission-driven company that leverages its direct-to-consumer, A.I.-powered platform to provide transportation and upward financial mobility solutions for underserved Hispanics in the United States. It utilizes advanced data analytics and technology to advance financial inclusion to a highly underserved market and offer responsible, affordable, credit-building auto loans to individuals with no or limited credit history.
Headquartered in Dallas, Texas, Tricolor and its affiliate Ganas Auto Group operate 52 retail centers across 20 markets in Texas, California, Nevada, Arizona, and New Mexico with a shared services center in Guadalajara, Mexico. On a combined basis, Tricolor and Ganas have served over over 100,000 customers and disbursed over $2.5 billion in affordable auto loans using their proprietary model to segment risk.
CONTACT INFORMATION
Stephanie Hicks
Cosmo PR for Tricolor
