Fitch Ratings Assigns 'AAAsf' Rating to BA Credit Card Trust Class A Notes

Strategic Insights -

The BA Credit Card Trust class A (2025-1) notes have been assigned a rating of 'AAAsf' by Fitch Ratings, reflecting the trust's stable performance and low credit risk. The trust is backed by a pool of revolving consumer credit card accounts originated by Bank of America, National Association (BANA). The rating outlook for the notes is stable, with the expectation that performance will remain supportive of the ratings.

Fitch closely examines collateral characteristics such as credit quality, seasoning, geographic concentration, delinquencies, and utilization rates on the credit cards. As of the April 2025 collection period, the trust's collateral performance metrics were in line with Fitch indices, with slight weakness through the TTM period. Delinquencies of 60+ days remained flat at 1.01%, compared to 1.00% a year ago, while gross charge-offs were 3.24% in April 2025, surpassing pre-pandemic levels.

Key Takeaways:

  • The trust's underlying collateral performance and collateral characteristics play a vital role in the performance of the credit card ABS transaction.
  • Fitch closely examines credit quality, seasoning, geographic concentration, delinquencies, and utilization rates on the credit cards.
  • As of April 2025, the trust's collateral performance metrics were in line with Fitch indices, with slight weakness through the TTM period.
  • Delinquencies of 60+ days remained flat at 1.01%, compared to 1.00% a year ago.
  • Gross charge-offs were 3.24% in April 2025, surpassing pre-pandemic levels.
  • Credit enhancement (CE) continues to be sufficient, with robust loss multiples in line with the current ratings.
  • The trust's rating sensitivity to increased charge-offs results in a stable rating at 75% increase over steady-state assumptions.
  • The trust's rating sensitivity to reduced MPR results in a stable rating at 35% reduction from steady-state assumptions.
  • The trust's rating sensitivity to reduced purchase rate results in a stable rating at 100% reduction from steady-state assumptions.
  • The trust's rating sensitivity to reduced gross yield results in a stable rating at 35% reduction from steady-state assumptions.
  • The trust's rating sensitivity to increased charge-offs and reduced MPR results in a stable rating at 35% reduction from steady-state assumptions.

Statistics:

  • Annualized charge-offs: 6.50%
  • Monthly Payment Rate (MPR): 18.00%
  • Annualized Gross Yield: 14.50%
  • Purchase Rate: 100.00%
  • Credit enhancement (CE): 31.75%
  • Steady-state assumptions:

+ Annualized Charge-offs: 6.50%

+ MPR: 18.00%

+ Annualized Gross Yield: 14.50%

+ Purchase Rate: 100.00%

  • Rating case assumptions (for 'AAAsf'):

+ Charge-offs: 4.50x

+ MPR (haircut): 45.00%

+ Gross Yield (haircut): 35.00%

+ Purchase Rate (haircut): 50.00%

Sources:

  • Fitch Ratings, "Structured Finance and Covered Bonds Counterparty Rating Criteria" (pub. 29 Nov 2023)
  • Fitch Ratings, "Credit Card ABS Rating Criteria" (pub. 20 Mar 2024)
  • Fitch Ratings, "Structured Finance and Covered Bonds Country Risk Rating Criteria" (pub. 20 Jun 2024)
  • Fitch Ratings, "Structured Finance and Covered Bonds Interest Rate Stresses Rating Criteria" (pub. 24 Oct 2024)
  • Fitch Ratings, "Global Structured Finance Rating Criteria" (pub. 18 Nov 2024)