PHH Corp. Closes $850M of TALF-Eligible Asset Backed Notes Issued by Chesapeake Funding

MT. LAUREL, NJ - PHH Corporation announced Sept. 11 the successful closing by its indirect wholly-owned subsidiary, Chesapeake Funding LLC, of the issuance and sale of $850 million in aggregate principal amount of its Series 2009-2 Floating Rate Asset Backed Notes, Class A.

According to a PHH Corp. statement, the Notes were rated AAA/Aaa by Standard & Poor's Rating Services and Moody's Investor Services, respectively, and qualified as "eligible collateral" under and as defined in the Term Asset-Backed Securities Loan Facility (TALF) established by the Federal Reserve Bank of New York.

A portion of the net proceeds from the issuance and sale of the Notes will be used to repay a portion of Chesapeake's Series 2006-1 Floating Rate Asset Backed Variable Funding Investor Notes, with the remaining proceeds expected to be used to fund the acquisition of vehicles to be leased to customers of PHH Arval, the company's fleet management business, according to a company statement.

"With the second successful issuance this year of TALF eligible securities backed by our commercial fleet lease assets, PHH Arval continues to solidify its position as a leading provider of financing solutions for the commercial fleet industry," said George Kilroy, acting chief executive officer and president of PHH, in a company statement.