AutoNation 2001 Annual Report Download - page 70

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Proceeds from securitizations under shelf registration...... 849.9 691.7
Servicing fees received..................................... 15.9 17.4
Other cash flows received on retained interests(1).......... 18.9 70.7
Purchases of assets from warehouse facility................. (725.0) (639.6)
------ ------
$557.2 $720.3
====== ======
---------------
(1) Other cash flows primarily include cash flows from interest-only strips and
other retained interests, excluding servicing fees.
Cash flows received from securitization transactions were used to fund
installment loan receivables, net of collections, of $474.9 million and $562.3
million for the years ended December 31, 2001 and 2000, respectively.
The weighted-average key economic assumptions used in measuring the
Company's investments in securitizations at the date of securitization resulting
from securitizations completed during the years ended December 31 were as
follows:
ASSUMPTIONS(1)
--------------
DESCRIPTION: 2001 2000
------------ ----- -----
Voluntary prepayment speed (ABS)............................ 1.16% 1.33%
Weighted-average life (in years)............................ 1.80 1.72
Expected credit losses (annual rate, excluding accrued
interest)................................................. 1.13% 1.08%
Discount rate on residual cash flows (annual rate).......... 7.97% 9.50%
---------------
(1) The weighted-average annual rates for securitizations entered into during
the period for securitizations of loans with similar characteristics.
At December 31, 2001, included in investments in securitizations are
interest-only strips valued at $51.2 million and cash reserve accounts valued at
$22.6 million which have an aggregate weighted-average life of 1.24 years. At
December 31, 2001, the sensitivity of the current fair value of the investments
in securitizations to immediate 10 percent and 20 percent unfavorable changes in
assumptions are presented in the table below. These sensitivities are
hypothetical and should not be considered to be predictive of future
performance. As the figures indicate, the change in fair value based on a 10
percent variation in assumptions cannot necessarily be extrapolated because the
relationship of the change in assumption to the change in the indicated fair
value may not be linear. Also, in this table, the effect of a variation in a
particular assumption on the fair value of the investments in securitizations is
calculated independently from any change in the other assumptions. In reality,
changes in one factor may contribute to changes in another (for example,
increases in market interest rates may result in lower prepayments and increased
credit losses), which might magnify or counteract the sensitivities.
Furthermore, the disclosed estimated fair values should not be considered
indicative of future
64
AUTONATION, INC.
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS -- (CONTINUED)
earnings on these assets. The current rate assumptions below reflect the