[slide 1]
SkyLend Receivables Trust 2024-1
$200,000,000 Consumer Receivables Securitization
Rule 144A / Regulation S Private Placement
Presented to: Meridian Credit Ratings, Inc. and Carrollton Ratings Group LLC
Prepared by Calderwood & Harkness LLP, Issuer's Counsel
April 8, 2024
[slide 2]
Transaction Overview
Issuer: SkyLend Receivables Trust 2024-1 (Delaware statutory trust; EIN 93-4201855)
Sponsor / Originator / Servicer: Skybridge Fintech Ltd. (Delaware corporation)
Depositor: SkyLend Funding LLC (Delaware single-member LLC; EIN 93-4187620)
Sole Bookrunner / Initial Purchaser: Halcyon Securities LLC
Owner Trustee: Keymark Trust Company, N.A.; Indenture Trustee: Atlantic Fiduciary Services, Inc.
Sub-Servicer: Clearview Loan Servicing, Inc.; Independent Auditor: Rowland & Cross LLP
Aggregate deal value: $200,000,000; Governing law: New York; CUSIP prefix: 87165Q
[slide 3]
Sponsor Profile — Skybridge Fintech Ltd.
Direct-to-consumer digital lending platform (SkyLend) launched 2019
Unsecured consumer installment loans, $1,000–$25,000, 12–60 month terms
~312,000 active borrowers as of 12/31/2023
FY2023 originations: ~$1.4 billion; FY2023 revenue: $187.3 million
Total assets (12/31/23): $1.02 billion; Gross receivables: $876.5M; Net receivables: $841.4M
PE Sponsor: Pinnacle Growth Equity Partners, LP (62.4% equity)
[slide 4]
Capital Structure
Class A Notes: $170,000,000 (85%) — expected Aaa(sf) / AA+(sf); coupon 5.45%–5.65%; WAL 2.1 years
Class B Notes: $22,000,000 (11%) — expected A2(sf) / A(sf); coupon 6.75%–7.00%; WAL 3.4 years
Subordinated Certificate / Residual: $8,000,000 (4%) — retained by SBF via SkyLend Funding LLC; unrated
Total: $200,000,000
[slide 5]
Legal Structure — Two-Step True Sale
Step 1: SBF sells receivables to SkyLend Funding LLC (Depositor) under Receivables Purchase Agreement
Step 2: Depositor transfers receivables to SRT 2024-1 (Issuer) under Sale and Servicing Agreement
Issuer grants security interest to Atlantic Fiduciary Services (Indenture Trustee) under Indenture
Notes issued by Issuer; proceeds flow up to Depositor and SBF
Structure designed to isolate receivables from SBF bankruptcy estate
[slide 6]
True-Sale Analysis
Absolute transfer of ownership with no retained interest in transferred receivables
Purchase price reflects fair market value; risk of loss passes to purchaser
No obligation to repurchase except for breach of loan-level R&Ws
Sale treatment consistent with parties' books, records, and tax reporting
True-sale opinion to be issued by C&H at closing
[slide 7]
Bankruptcy-Remoteness — Depositor and Trust
Depositor: single-purpose entity with separateness covenants; independent manager consent required for bankruptcy filing
Issuer: Delaware statutory trust with limited-purpose provisions; institutional owner trustee (Keymark)
Restrictions on additional debt, mergers, dissolution, and non-securitization activities
Separate books, records, bank accounts, and observance of corporate formalities
Non-consolidation opinion to be delivered by C&H at closing
[slide 8]
Security Interest and Perfection
Grant of security interest in all receivables and related assets under the Indenture
UCC-1 financing statements to be filed in Delaware (Depositor) and against Issuer
Custodial Agreement with AFS as custodian of receivable files
Account Control Agreement establishes control in favor of Indenture Trustee
Security-interest opinion to be delivered by C&H at closing
[slide 9]
Receivables Pool Characteristics (Cut-Off 3/31/2024)
~23,100 loans; aggregate outstanding principal balance ~$213.75M (pre-selection)
Statistical cut to $200,000,000 final pool after eligibility screening
Weighted Average Coupon (WAC): 14.82%
Weighted Average Remaining Term: 38.4 months
Weighted Average FICO at origination: 698
30+ DPD (per servicer data): 3.21%
Max single-obligor concentration: 0.15%; No single state > 20%
[slide 10]
Eligibility Criteria and Representations
Originated and funded through the SkyLend platform per SBF's underwriting guidelines
Contractual and legal compliance with TILA, ECOA, FCRA, and state lending laws
Minimum FICO threshold; exclusion of loans 30+ DPD at cut-off
Maximum single-obligor concentration 0.15%; state concentration cap 20%
Breach of eligibility R&W triggers repurchase obligation by SBF
[slide 11]
Payment Waterfall — Interest and Principal
1. Trustee fees, servicing fees, and administrative expenses (capped)
2. Class A interest
3. Class B interest
4. Class A principal (per targeted amortization)
5. Class B principal (subject to subordination and step-down)
6. Reserve account replenishment to required balance
7. Overcollateralization build to target
8. Excess spread released to residual holder (subject to triggers)
[slide 12]
Payment Application at the Loan Level
Payments applied per §4.03 of the Master Servicing Agreement (October 1, 2022): interest → fees → principal
Consistent methodology across all loans in the pool
Servicing reports produced monthly by Clearview Loan Servicing, Inc.
Historical static-pool performance derived from Clearview servicing tapes
Servicer oversight by SBF through quarterly data reconciliation
[slide 13]
Credit Enhancement
Subordination: 11% CE for Class A from Class B; 15% total CE for Class A with residual
Overcollateralization target: 3.5% ($7,000,000)
Reserve account (cash): 1.00% at closing ($2,000,000)
Excess spread: estimated 2.85% per annum
Total initial hard credit enhancement to Class A: 19.5%
[slide 14]
Overcollateralization Mechanics
Initial OC: 3.5% of pool balance ($7,000,000)
OC builds through excess spread being trapped when target not met
Step-down permitted after seasoning period subject to performance triggers
OC target dynamically adjusts based on cumulative net loss and delinquency triggers
[slide 15]
Early-Amortization Triggers
Cumulative net loss trigger (tiered by seasoning)
3-month rolling average delinquency trigger
Servicer default or termination event
Failure to maintain reserve account or OC target for consecutive periods
Bankruptcy of SBF, Depositor, or Trust
Breach of R&Ws not cured within grace period
[slide 16]
Servicing — Clearview Loan Servicing, Inc.
Ohio corporation; principal office Cleveland, OH
Servicer of SBF's securitized and warehouse portfolios since Q3 2022
~$640 million in SBF receivables under management as of 12/31/2023
Servicing fee: 0.50% per annum ($1,000,000 estimated in year one)
Monthly investor reporting to Indenture Trustee and noteholders
Servicer's core platform: ClearCore (migrated from LoanTrax in June 2023)
[slide 17]
Backup Servicing
Backup servicer role contemplated in draft agreement (dual-role by Clearview under discussion)
Standard servicer termination events: material breach, insolvency, key financial covenants
Successor servicer to be appointed by Indenture Trustee
Data-tape and system transition protocols under development
[slide 18]
Tax and Accounting Treatment
Issuer intended to qualify as grantor trust under Subpart E of Subchapter J of the IRC
Two-class structure supported by fixed-investment trust analysis
Depositor is single-member LLC (disregarded entity for federal tax purposes)
Tax opinion to be delivered by C&H at closing
[slide 19]
Static-Pool Performance Data
Static-pool performance derived from Clearview servicing tapes
2022 vintage cumulative net loss (per servicing data): 4.12%
Vintage curves demonstrate seasoning pattern consistent with unsecured consumer ABS
Prepayment behavior consistent with 14.82% WAC and 38.4-month WART
Delinquency roll-rates presented by bucket
[slide 20]
Independent Due Diligence and Comfort
Loan-level re-underwriting by Broadleaf Analytics Group LLC (engaged by Halcyon)
Stratified random sample: 1,500 loans (~6.5% of pool by count)
Independent auditor: Rowland & Cross LLP (AUP and comfort letter engagement)
C&H legal opinions: true sale, non-consolidation, security interest, tax
[slide 21]
Transaction Documents
Indenture (SRT 2024-1 & AFS) — Draft circulated 3/4/2024
Receivables Purchase Agreement (SBF & Depositor) — Draft 3/11/2024
Sale and Servicing Agreement — Draft 3/11/2024
Preliminary Purchase Agreement (Trust, SBF, Depositor, Halcyon)
Trust Agreement (Depositor & Keymark) — Executed 2/14/2024
Administration, Custodial, Account Control, and Backup Servicing Agreements
[slide 22]
Indicative Timeline to Pricing and Closing
April 8, 2024: Rating-agency presentations (today)
Preliminary OM distributed: April 5, 2024
Investor roadshow: April 15–19, 2024
Pricing: late April 2024 (expected)
Closing: early May 2024 (expected)
[slide 23]
Summary and Discussion
$200M consumer receivables securitization with layered credit enhancement
Established sponsor with $1.4B FY2023 originations and Pinnacle equity backing
Robust legal structure: true sale, non-consolidation, perfected security interest
Experienced servicer with dedicated reporting infrastructure
Independent due diligence in process; comfort letter and legal opinions to follow