Lendbuzz, an AI-based financial technology company, provides consumers with access to credit for vehicle purchases. The company achieves this by assessing creditworthiness, particularly for individuals with limited credit history, through the use of alternative data and machine learning algorithms. This approach aims to serve a demographic often underserved by traditional financial institutions.
Lendbuzz announced the completion of a $266 million asset-backed securitization, designated LBZZ 2025-2. This financial instrument is collateralized by a pool of auto loans originated by Lendbuzz. These loans are secured by new and used automobiles, light duty trucks, and vans, forming the underlying assets for the securitization.
The LBZZ 2025-2 notes were issued in five distinct classes: Class A-1, Class A-2, Class B, Class C, and Class D. These classes represent different tranches of risk and return within the securitization structure. S&P Global Ratings and Kroll Bond Rating Agency (KBRA) provided ratings for these notes, assigning K1+/NR to Class A-1, AAA/AA to Class A-2, AA-/AA- to Class B, A-/A- to Class C, and BBB/NR to Class D. These ratings reflect the credit agencies' assessment of the notes' repayment probability.
The round was led by Goldman Sachs, which served as the lead bookrunner and structuring agent for the securitization. Participating investors included J.P. Morgan Securities, Mizuho, and RBC Capital Markets, all of whom acted as joint bookrunners. Additionally, MUFG and Regions Securities participated as co-managers in the transaction, facilitating the distribution and placement of the notes.
This $266 million securitization provides additional funding capacity for Lendbuzz. It forms part of the company's broader, diverse funding strategy, which relies on such transactions to scale its operations. The increased capacity supports Lendbuzz's ongoing mission to offer fair access to credit for underserved populations, a core aspect of its business model.
To date, Lendbuzz has completed over $2.1 billion in publicly syndicated asset-backed securitizations. This cumulative figure highlights the company's consistent use of this funding mechanism since its inception. The company remains committed to growing this program as a key component of its financial strategy.
"We are proud to have closed another successful transaction that deepens our access to diverse funding sources," commented George Sclavos, Chief Financial Officer at Lendbuzz.
Lendbuzz, founded in 2015, is headquartered in Boston, Massachusetts. Through its network of auto dealership partners, the company offers financing solutions to consumers. This arrangement also opens opportunities for these dealerships to serve a more diverse customer base, including those with limited traditional credit histories. The company's reliance on AI and machine learning algorithms is central to its ability to assess creditworthiness beyond conventional metrics.
