DBRS Morningstar Confirms Ratings of Golden Credit Card Trust

DBRS Limited (DBRS Morningstar) confirmed the ratings of all the outstanding notes (the Notes) issued by Golden Credit Card Trust (the Trust). The confirmation is part of DBRS Morningstar’s continued effort to provide timely credit rating opinions and increased transparency to market participants.

-- Credit Card Receivables-Backed Class A Notes, Series 2018-4 at AAA (sf)
-- Credit Card Receivables-Backed Class B Notes, Series 2018-4 at A (high) (sf)
-- Credit Card Receivables-Backed Class C Notes, Series 2018-4 at BBB (high) (sf)

-- Credit Card Receivables-Backed Class A Notes, Series 2021-1 at AAA (sf)
-- Credit Card Receivables-Backed Class B Notes, Series 2021-1 at A (high) (sf)
-- Credit Card Receivables-Backed Class C Notes, Series 2021-1 at BBB (high) (sf)

-- Credit Card Receivables-Backed Class A Notes, Series 2022-1 at AAA (sf)
-- Credit Card Receivables-Backed Class B Notes, Series 2022-1 at A (high) (sf)
-- Credit Card Receivables-Backed Class C Notes, Series 2022-1 at BBB (high) (sf)

-- Credit Card Receivables-Backed Class A Floating Rate Notes, Series 2022-2 at AAA (sf)
-- Credit Card Receivables-Backed Class B Notes, Series 2022-2 at A (high) (sf)
-- Credit Card Receivables-Backed Class C Notes, Series 2022-2 at BBB (high) (sf)

-- Credit Card Receivables-Backed Class A Floating Rate Notes, Series 2022-3 at AAA (sf)
-- Credit Card Receivables-Backed Class B Notes, Series 2022-3 at A (high) (sf)
-- Credit Card Receivables-Backed Class C Notes, Series 2022-3 at BBB (high) (sf)

The rating confirmations are based on the following factors as of June 2022:

(1) The Notes benefit from excess spread, which has been in the range of 19.1% to 24.8% over the past 12 months, and series-specific cash accounts, which could build up to 5.0% of the Initial Invested Amount. For the AAA (sf)-rated and A (high) (sf)-rated notes, credit enhancement is also available through subordination of 6.5% and 2.0%, respectively.

(2) The payment rate has been trending upward at 71.6% as of June 2022, averaging 66.7% over the past 12 months. The monthly gross yield has remained stable at 25.5%, averaging 25.4% over the past 12 months.

(3) The one-month loss rate remains low and has averaged 1.3% over the past 12 months.

(4) The receivables pool is a well-diversified and seasoned portfolio composed of certain credit card accounts originated, managed, and designated by Royal Bank of Canada (RBC). RBC is one of the largest financial institutions in Canada by market capitalization and is rated AA (high)/R-1 (high) with Stable trends by DBRS Morningstar as of May 2022.

The performance and characteristics of the receivables pool and the Notes are available and updated each month in DBRS Morningstar’s Monthly Canadian ABS Report. DBRS Morningstar conducts a monthly stress testing of each rated class of the Trust, with the results indicating that simultaneous declines in yield and payment rates and increases in losses would not result in a failure of the Trust to repay the Notes on a timely basis. The severity of the tests applied is commensurate with the respective ratings of the Notes.

ENVIRONMENTAL, SOCIAL, GOVERNANCE CONSIDERATIONS
There were no Environmental/Social/Governance (ESG) factors that had a significant or relevant effect on the credit analysis.

A description of how DBRS Morningstar considers ESG factors within the DBRS Morningstar analytical framework can be found in the DBRS Morningstar Criteria: Approach to Environmental, Social, and Governance Risk Factors in Credit Ratings at https://www.dbrsmorningstar.com/research/396929.

Notes:
All figures are in Canadian dollars unless otherwise noted.

The principal methodology is Master Canadian Structured Finance Surveillance Methodology (June 7, 2022), which can be found on dbrsmorningstar.com under Methodologies & Criteria.

The DBRS Morningstar Sovereign group releases baseline macroeconomic scenarios for rated sovereigns. DBRS Morningstar analysis considered impacts consistent with the baseline scenarios as set forth in the following report: https://www.dbrsmorningstar.com/research/384482.

The related regulatory disclosures pursuant to the National Instrument 25-101 Designated Rating Organizations are hereby incorporated by reference and can be found by clicking on the link under Related Documents or by contacting us at info@dbrsmorningstar.com.

The rated entity or its related entities did participate in the rating process for this rating action. DBRS Morningstar had access to the accounts and other relevant internal documents of the rated entity or its related entities in connection with this rating action.

Please see the related appendix for additional information regarding the sensitivity of assumptions used in the rating process.

For more information on this credit or on this industry, visit www.dbrsmorningstar.com or contact us at info@dbrsmorningstar.com.

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