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District Metals Corp. — Management Reports 2025
May 29, 2025
43428_rns_2025-05-28_4ccced92-6f06-4c39-bb89-753c672e9f09.pdf
Management Reports
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Management's Discussion and Analysis of Financial Condition and Results of Operations
EAGLE CREDIT CARD TRUST®
For the three months ended March 31, 2025
May 28, 2025
® Registered trademark of Loblaws Inc.
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Capitalized terms not otherwise defined herein shall, for the Series 2019-1, have the meanings set out in the short form base shelf prospectus dated August 2, 2017 and the Series 2019-1 pricing supplement dated July 17, 2019; shall, for the Series 2020-1, have the meanings set out in the short form base shelf prospectus dated September 27, 2019 and the Series 2020-1 pricing supplement dated August 4, 2020; shall, for the Series 2021-1, have the meanings set out in the short form base shelf prospectus dated September 27, 2019 and the Series 2021-1 pricing supplement dated June 14, 2021; shall, for the Series 2022-1, have the meanings set out in the short form base shelf prospectus dated June 2, 2022 and the Series 2022-1 pricing supplement dated July 6, 2022; shall, for the Series 2023-1., have the meanings set out in the short form base shelf prospectus dated June 2, 2022 and the Series 2023-1 pricing supplement dated June 6, 2023 and shall, for the Series 2024-1, have the meanings set out in the short form base shelf prospectus dated June 2, 2022 and the Series 2024-1 pricing supplement dated May 28, 2024.
The following management's discussion and analysis ("MD&A") explains the financial condition and results of operations of Eagle Credit Card Trust (the "Trust") for the three months ended March 31, 2025. Additional information relating to the Trust may be found under the Trust's profile on the SEDAR+ website at www.sedarplus.ca.
General
The Trust was established under the laws of the Province of Ontario pursuant to a declaration of trust ("Declaration of Trust") made as of October 24, 2005. The issuer trustee of the Trust is Montreal Trust Company of Canada (the "Issuer Trustee"). Pursuant to an Assignment of Trusts Agreement dated November 14, 2007, Computershare Trust Company of Canada resigned as Issuer Trustee and Montreal Trust Company of Canada was appointed as the successor Issuer Trustee effective November 6, 2007. The Trust's financial year-end is December 31. The Trust was created as a special purpose vehicle to issue, from time to time, securities backed by credit card receivables (the "asset-backed securities") originated by President's Choice Bank ("PC Bank" or the "Seller") (including for the purposes hereof, any of its affiliates). The asset-backed securities issued by the Trust are secured by undivided co-ownership interests in a revolving pool of credit card receivables (the "Collateral"). The Trust is otherwise limited in its business activities and will not carry on any business except in respect of the issuance of asset-backed securities to finance the acquisition of undivided co-ownership interests in the Collateral pursuant to securitization transactions.
PC Bank or its affiliates are and will be the originator of the Collateral, interests in which are sold to the Trust, and is and will be the initial servicer of the Collateral pursuant to a pooling and servicing agreement ("Pooling and Servicing Agreement"). Undivided co-ownership interests in the Collateral may be sold to the Trust either directly by PC Bank or its affiliates or by arm's length special purpose entities to which PC Bank or its affiliates had previously sold undivided co-ownership interests in the Collateral.
Pursuant to a financial services agreement ("Financial Services Agreement") entered into between the Issuer Trustee and PC Bank, PC Bank as "Financial Services Agent" has agreed to carry out certain financial services and management activities for and on behalf of the Trust. PC Bank has delegated certain of its responsibilities to Canadian Imperial Bank of Commerce ("CIBC") as its "Financial Services Sub-Agent". The responsibilities of the Financial Services Sub-Agent include the day-to-day administration and operation of the Trust, the structuring and management of undivided co-ownership interests in the Collateral and the monitoring of the undivided co-ownership interests in the Collateral.
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PC Bank and its affiliates may from time to time purchase asset-backed securities issued by the Trust, either at the time of their initial issuance or in the secondary market.
On July 24, 2019, the Trust purchased a co-ownership interest in the amount of $250.00 million in PC Bank-originated credit card receivables (the "Series 2019-1 Co-Ownership Interest") from PC Bank. Pursuant to a base shelf prospectus dated August 2, 2017 and a corresponding pricing supplement dated July 17, 2019, the Trust funded the purchase of the Series 2019-1 Co-Ownership Interest through the issuance of $232.50 million of Credit Card Receivables-Backed Class A Notes, Series 2019-1 (the "Series 2019-1 Class A Notes"), $8.75 million of Credit Card Receivables-Backed Class B Notes, Series 2019-1 (the "Series 2019-1 Class B Notes") and $8.75 million of Credit Card Receivables-Backed Class C Notes, Series 2019-1 (the "Series 2019-1 Class C Notes", and together with the Series 2019-1 Class A Notes and the Series 2019-1 Class B Notes, the "Series 2019-1 Notes").
On issuance, the Series 2019-1 Class A Notes were assigned a rating of "AAA (sf)" by DBRS and "AAAsf" by Fitch. The Series 2019-1 Class B Notes were assigned a rating of "A (sf)" by DBRS and "Asf" by Fitch and the Series 2019-1 Class C Notes were assigned a rating of "BBB (sf)" by DBRS and "BBBsf" by Fitch.
On July 17, 2024, the Trust repaid the Series 2019-1 Notes in full.
On August 11, 2020, the Trust purchased a co-ownership interest in the amount of $300.00 million in PC Bank-originated credit card receivables (the "Series 2020-1 Co-Ownership Interest") from PC Bank. Pursuant to a base shelf prospectus dated September 27, 2019 and a corresponding pricing supplement dated August 4, 2020, the Trust funded the purchase of the Series 2020-1 Co-Ownership Interest through the issuance of $279.00 million of Credit Card Receivables-Backed Class A Notes, Series 2020-1 (the "Series 2020-1 Class A Notes"), $10.50 million of Credit Card Receivables-Backed Class B Notes, Series 2020-1 (the "Series 2020-1 Class B Notes") and $10.50 million of Credit Card Receivables-Backed Class C Notes, Series 2020-1 (the "Series 2020-1 Class C Notes", and together with the Series 2020-1 Class A Notes and the Series 2020-1 Class B Notes, the "Series 2020-1 Notes").
On issuance, the Series 2020-1 Class A Notes were assigned a rating of "AAA (sf)" by DBRS and "AAAsf" by Fitch. The Series 2020-1 Class B Notes were assigned a rating of "A (sf)" by DBRS and "Asf" by Fitch and the Series 2020-1 Class C Notes were assigned a rating of "BBB (sf)" by DBRS and "BBBsf" by Fitch.
On June 21, 2021, the Trust purchased a co-ownership interest in the amount of $300.00 million in PC Bank-originated credit card receivables (the "Series 2021-1 Co-Ownership Interest") from PC Bank. Pursuant to a base shelf prospectus dated September 27, 2019 and a corresponding pricing supplement dated June 14, 2021, the Trust funded the purchase of the Series 2021-1 Co-Ownership Interest through the issuance of $279.00 million of Credit Card Receivables-Backed Class A Notes, Series 2021-1 (the "Series 2021-1 Class A Notes"), $10.50 million of Credit Card Receivables-Backed Class B Notes, Series 2021-1 (the "Series 2021-1 Class B Notes") and $10.50 million of Credit Card Receivables-Backed Class C Notes, Series 2021-1 (the "Series 2021-1 Class C Notes", and together with the Series 2021-1 Class A Notes and the Series 2021-1 Class B Notes, the "Series 2021-1 Notes").
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On issuance, the Series 2021-1 Class A Notes were assigned a rating of "AAA (sf)" by DBRS and "AAAsf" by Fitch. The Series 2021-1 Class B Notes were assigned a rating of "A (sf)" by DBRS and "Asf" by Fitch and the Series 2021-1 Class C Notes were assigned a rating of "BBB (sf)" by DBRS and "BBBsf" by Fitch.
On July 13, 2022, the Trust purchased a co-ownership interest in the amount of $250.00 million in PC Bank-originated credit card receivables (the "Series 2022-1 Co-Ownership Interest") from PC Bank. Pursuant to a base shelf prospectus dated June 2, 2022 and a corresponding pricing supplement dated July 6, 2022, the Trust funded the purchase of the Series 2022-1 Co-Ownership Interest through the issuance of $232.50 million of Credit Card Receivables-Backed Class A Notes, Series 2022-1 (the "Series 2022-1 Class A Notes"), $8.75 million of Credit Card Receivables-Backed Class B Notes, Series 2022-1 (the "Series 2022-1 Class B Notes") and $8.75 million of Credit Card Receivables-Backed Class C Notes, Series 2022-1 (the "Series 2022-1 Class C Notes", and together with the Series 2022-1 Class A Notes and the Series 2022-1 Class B Notes, the "Series 2022-1 Notes").
On issuance, the Series 2022-1 Class A Notes were assigned a rating of "AAA (sf)" by DBRS and "AAAsf" by Fitch. The Series 2022-1 Class B Notes were assigned a rating of "A (sf)" by DBRS and "Asf" by Fitch and the Series 2022-1 Class C Notes were assigned a rating of "BBB (sf)" by DBRS and "BBBsf" by Fitch.
On June 13, 2023, the Trust purchased a co-ownership interest in the amount of $250.00 million in PC Bank-originated credit card receivables (the "Series 2023-1 Co-Ownership Interest") from PC Bank. Pursuant to a base shelf prospectus dated June 2, 2022 and a corresponding pricing supplement dated June 6, 2023, the Trust funded the purchase of the Series 2023-1 Co-Ownership Interest through the issuance of $232.50 million of Credit Card Receivables-Backed Class A Notes, Series 2023-1 (the "Series 2023-1 Class A Notes"), $8.75 million of Credit Card Receivables-Backed Class B Notes, Series 2023-1 (the "Series 2023-1 Class B Notes") and $8.75 million of Credit Card Receivables-Backed Class C Notes, Series 2023-1 (the "Series 2023-1 Class C Notes", and together with the Series 2023-1 Class A Notes and the Series 2023-1 Class B Notes, the "Series 2023-1 Notes").
On issuance, the Series 2023-1 Class A Notes were assigned a rating of "AAA (sf)" by DBRS and "AAAsf" by Fitch. The Series 2023-1 Class B Notes were assigned a rating of "A (sf)" by DBRS and "Asf" by Fitch and the Series 2023-1 Class C Notes were assigned a rating of "BBB (sf)" by DBRS and "BBBsf" by Fitch.
On June 4, 2024, the Trust purchased a co-ownership interest in the amount of $350.00 million in PC Bank-originated credit card receivables (the "Series 2024-1 Co-Ownership Interest") from PC Bank. Pursuant to a base shelf prospectus dated June 2, 2022 and a corresponding pricing supplement dated May 28, 2024, the Trust funded the purchase of the Series 2024-1 Co-Ownership Interest through the issuance of $325.50 million of Credit Card Receivables-Backed Class A Notes, Series 2024-1 (the "Series 2024-1 Class A Notes"), $12.25 million of Credit Card Receivables-Backed Class B Notes, Series 2024-1 (the "Series 2024-1 Class B Notes") and $12.25 million of Credit Card Receivables-Backed Class C Notes, Series 2024-1 (the "Series 2024-1 Class C Notes", and together with the Series 2024-1 Class A Notes and the Series 2024-1 Class B Notes, the "Series 2024-1 Notes").
On issuance, the Series 2024-1 Class A Notes were assigned a rating of "AAA (sf)" by DBRS and "AAAsf" by Fitch. The Series 2024-1 Class B Notes were assigned a rating of "A (sf)" by DBRS and "Asf" by Fitch and the Series 2024-1 Class C Notes were assigned a rating of "BBB (sf)" by DBRS and "BBBsf" by Fitch.
The Series 2020-1 Notes, the Series 2021-1 Notes, the Series 2022-1 Notes, the Series 2023-1 Notes and the Series 2024-1 Notes are each referred to as a "Series of Notes" and collectively referred to as the "Notes".
There have been no rating changes by DBRS or by Fitch since the issuance of the Notes.
Notes Outstanding (in thousands of Canadian dollars)
| As at March 31, 2025 | As at December 31, 2024 | |
|---|---|---|
| Series 2020-1 | ||
| Class A Notes @ 1.273% | 279,000 | 279,000 |
| Class B Notes @ 1.773% | 10,500 | 10,500 |
| Class C Notes @ 2.773% | 10,500 | 10,500 |
| Series 2021-1 | ||
| Class A Notes @ 1.546% | 279,000 | 279,000 |
| Class B Notes @ 2.026% | 10,500 | 10,500 |
| Class C Notes @ 2.876% | 10,500 | 10,500 |
| Series 2022-1 | ||
| Class A Notes @ 4.783% | 232,500 | 232,500 |
| Class B Notes @ 5.633% | 8,750 | 8,750 |
| Class C Notes @ 6.833% | 8,750 | 8,750 |
| Series 2023-1 | ||
| Class A Notes @ 5.134% | 232,500 | 232,500 |
| Class B Notes @ 6.114% | 8,750 | 8,750 |
| Class C Notes @ 7.364% | 8,750 | 8,750 |
| Series 2024-1 | ||
| Class A Notes @ 4.916% | 325,500 | 325,500 |
| Class B Notes @ 5.866% | 12,250 | 12,250 |
| Class C Notes @ 7.116% | 12,250 | 12,250 |
| 1,450,000 | 1,450,000 |
The purpose of the series-specific Accumulation Period is to accumulate the Collections sufficient to repay all amounts owing under the Series 2020-1 Notes, the Series 2021-1 Notes, the Series 2022-1 Notes, the Series 2023-1 Notes and the Series 2024-1 Notes respectively and all related accrued Trust Expenses and Funding Costs by the Targeted Principal Distribution Date for such Series. On the settlement date of each month in the Accumulation Period, a portion of Collections (the "Controlled Accumulation Principal Amount") that was accumulated in the Collection Account is deposited to the Accumulations Account for such Series.
The pre-accumulation reserve period (the "Pre-Accumulation Reserve Period") in respect of a Series commences three months prior to the accumulation commencement date (the "Accumulation Commencement Date") for such Series or such earlier date as specified by the Servicer.
Funds remitted to the series-specific Reserve Account in respect of the related Required Pre-Accumulation Amount can be used to fund any shortfall in payment on the related
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Series of Notes on the respective Targeted Principal Distribution Date. The shortfall in payment may be due to any difference between the interest rate of such Series of Notes and the rate of interest earned on Eligible Investments in respect of amounts deposited to a segregated eligible deposit account (the "Accumulations Account") established in the name of the co-owner in accordance with the Pooling and Servicing Agreement and related Series Co-Ownership Agreement during the accumulation period (the "Accumulation Period").
Selected Financial Information
Revenues of the Trust
Each secured loan represents the Trust's right to receive distributions with respect to the related co-ownership entitlements to a revolving pool of credit card receivables to satisfy its interest and principal payment obligations under the related Notes, and to pay its related expenses. The financial statements of the Trust include such co-ownership entitlements.
During the three months ended March 31, 2025, the revenues received were sufficient to meet the obligations of the Trust.
| | Revenues
(in thousands of Canadian dollars) | |
| --- | --- | --- |
| | Three months ended | |
| | March 31, 2025 | March 31, 2024 |
| Revenue | | |
| Income from | | |
| Secured loans | 12,895 | 9,905 |
| Interest on short-term investments | 49 | 67 |
| Administrative expense recovery | 209 | 227 |
| | 13,153 | 10,199 |
Expenses of the Trust
Expenses of the Trust mainly consist of interest expense on the Notes outstanding during the year. For the three months ended March 31, 2025, interest expense on the Notes was $12.94 million (for the three months ended March 31, 2024 – $9.97 million).
Other expenses of the Trust, which are mainly comprised of rating agency fees, indenture trustee fees, issuer trustee fees, financial services sub-agent fees, external audit fees and custodian fees totalled $0.21 million for the three months ended March 31, 2025 (for the three months ended March 31, 2024 – $0.23 million).
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Term Notes Interest Expense
(in thousands of Canadian dollars)
| Three months ended | ||
|---|---|---|
| March 31, 2025 | March 31, 2024 | |
| Series 2019-1 | ||
| Class A Notes @ 2.220% | - | 1,291 |
| Class B Notes @ 2.750% | - | 60 |
| Class C Notes @ 3.450% | - | 75 |
| Series 2020-1 | ||
| Class A Notes @ 1.273% | 888 | 888 |
| Class B Notes @ 1.773% | 46 | 46 |
| Class C Notes @ 2.773% | 73 | 73 |
| Series 2021-1 | ||
| Class A Notes @ 1.546% | 1,078 | 1,078 |
| Class B Notes @ 2.026% | 53 | 53 |
| Class C Notes @ 2.876% | 76 | 76 |
| Series 2022-1 | ||
| Class A Notes @ 4.783% | 2,780 | 2,780 |
| Class B Notes @ 5.633% | 123 | 123 |
| Class C Notes @ 6.833% | 150 | 150 |
| Series 2023-1 | ||
| Class A Notes @ 5.134% | 2,984 | 2,984 |
| Class B Notes @ 6.114% | 134 | 134 |
| Class C Notes @ 7.364% | 161 | 161 |
| Series 2024-1 | ||
| Class A Notes @ 4.916% | 4,001 | - |
| Class B Notes @ 5.866% | 179 | - |
| Class C Notes @ 7.116% | 218 | - |
| 12,944 | 9,972 |
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Cash Flows of the Trust
The interest payments for the Series of Notes outstanding March 31, 2025 and 2024 were as follows:
Cash Flows
(in thousands of Canadian dollars)
| Three months ended | ||
|---|---|---|
| March 31, 2025 | March 31, 2024 | |
| Series 2019-1 | ||
| Class A Notes @ 2.220% | - | 2,581 |
| Class B Notes @ 2.750% | - | 120 |
| Class C Notes @ 3.450% | - | 151 |
| Series 2020-1 | ||
| Class A Notes @ 1.273% | 1,776 | 1,776 |
| Class B Notes @ 1.773% | 93 | 93 |
| Class C Notes @ 2.773% | 145 | 145 |
| Series 2021-1 | ||
| Class A Notes @ 1.546% | - | - |
| Class B Notes @ 2.026% | - | - |
| Class C Notes @ 2.876% | - | - |
| Series 2022-1 | ||
| Class A Notes @ 4.783% | 5,560 | 5,560 |
| Class B Notes @ 5.633% | 247 | 247 |
| Class C Notes @ 6.833% | 299 | 299 |
| Series 2023-1 | ||
| Class A Notes @ 5.134% | - | - |
| Class B Notes @ 6.114% | - | - |
| Class C Notes @ 7.364% | - | - |
| Series 2024-1 | ||
| Class A Notes @ 4.916% | - | - |
| Class B Notes @ 5.866% | - | - |
| Class C Notes @ 7.116% | - | - |
| 8,120 | 10,972 |
Performance of Account Assets
The performance of the Account Assets (including collections, losses and delinquencies) for the three months ended March 31, 2025 has been in line with management expectations.
The Pool Balance at any time is equal to the sum of the aggregate outstanding balances of all principal receivables, excluding charged-off amounts, at that time. The Pool Balance as at March 31, 2025 was $3,028.34 million, an increase of 7.73% from the March 31, 2024 balance of $2,811.12 million. The total number of accounts as at March 31, 2025 was 2.06 million, a decrease of 41.69% from the March 31, 2024 number of 3.53 million.
The Pool Balance percentage is in excess of the 107% minimum required by the provisions of the Pooling and Servicing Agreement.
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The annualized net losses as a percentage of the average Receivables outstanding decreased to 3.89% for the three months ended March 31, 2025 from 4.14% for the three months ended March 31, 2024. Receivables over 30 days delinquent as a percentage of the Account Assets decreased to 2.04% as of March 31, 2025 from 2.14% as of March 31, 2024.
Average annualized revenue yield of the Account Assets for the three months ended March 31, 2025 was 27.15%, compared to 26.30% for the three months ended March 31, 2024. The increase in the average annualized revenue yield was primarily driven by higher finance charges. The payment rate, calculated as the average of monthly payment rates for the reporting period, was 62.96% for three months ended March 31, 2025 compared to 62.15% for the three months ended March 31, 2024. Monthly payment rates on the Account Assets may vary due to, among other things, the availability of other sources of credit, general economic conditions, consumer spending and borrowing patterns, and the terms of the credit card accounts.
Total Receivables Outstanding(1)
(unaudited)
(in thousands of Canadian Dollars)
| March 31, 2025 | March 31, 2024 | |
|---|---|---|
| Outstanding Receivables(1) | $3,042,736 | $2,832,209 |
(1) Total Receivables Outstanding includes both principal receivables and finance charge receivables whereas the Pool Balance includes only principal receivables.
Composition by Account Balance
As at March 31, 2025
(unaudited)
| Account Balances | Custodial Pool | |||
|---|---|---|---|---|
| Number of Accounts | Percentage of Total Accounts | Total Receivables Outstanding | Percentage of Total Receivables Outstanding | |
| Credit Balance (1) | 128,417 | 6.24% | $ (34,906,487) | (1.16)% |
| No Balance (2) | 617,455 | 29.99% | — | 0.00% |
| ≤ $500.00 | 435,800 | 21.17% | 89,659,320 | 2.95% |
| $500.01 to $1,000.00 | 208,234 | 10.12% | 152,875,581 | 5.02% |
| $1,000.01 to $3,000.00 | 341,244 | 16.58% | 619,663,583 | 20.37% |
| $3,000.01 to $5,000.00 | 136,755 | 6.64% | 534,222,562 | 17.56% |
| $5,000.01 to $10,000.00 | 134,670 | 6.54% | 948,306,294 | 31.17% |
| > $10,000.00 | 56,022 | 2.72% | 732,914,890 | 24.09% |
| Totals | 2,058,597 | 100.00% | $3,042,735,743 | 100.00% |
(1) Credit balances are a result of cardholder payments and credit adjustments applied in excess of an Account's unpaid balance. Accounts which currently have a credit balance are included because Receivables may be generated with respect thereto in the future.
(2) Accounts which currently have no balance are included because Receivables may be generated with respect thereto in the future.
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Composition by Account Balance
As at December 31, 2024
(unaudited)
Custodial Pool
| Account Balances | Number of Accounts | Percentage of Total Accounts | Total Receivables Outstanding | Percentage of Total Receivables Outstanding |
|---|---|---|---|---|
| Credit Balance (1) | 130,273 | 6.40% | $ (35,586,544) | (1.09)% |
| No Balance (2) | 571,572 | 28.07% | — | 0.00% |
| ≤ $500.00 | 413,316 | 20.30% | 84,802,010 | 2.59% |
| $500.01 to $1,000.00 | 205,959 | 10.11% | 151,600,864 | 4.64% |
| $1,000.01 to $3,000.00 | 357,915 | 17.57% | 654,437,832 | 20.02% |
| $3,000.01 to $5,000.00 | 149,326 | 7.33% | 584,038,717 | 17.86% |
| $5,000.01 to $10,000.00 | 147,574 | 7.25% | 1,037,592,252 | 31.74% |
| > $10,000.00 | 60,583 | 2.97% | 792,404,514 | 24.24% |
| Totals | 2,036,518 | 100.00% | $3,269,289,645 | 100.00% |
(1) Credit balances are a result of cardholder payments and credit adjustments applied in excess of an Account's unpaid balance. Accounts which currently have a credit balance are included because Receivables may be generated with respect thereto in the future.
(2) Certain accounts which are open and currently have no balance are included because Receivables may be generated with respect thereto in the future.
Composition by Credit Limit
As at March 31, 2025
(unaudited)
Custodial Pool
| Credit Limit | Number of Accounts | Percentage of Total Accounts | Total Receivables Outstanding | Percentage of Total Receivables Outstanding |
|---|---|---|---|---|
| ≤ $500.00 | 41,995 | 2.04% | $ 4,836,173 | 0.16% |
| $500.01 to $1,000.00 | 156,846 | 7.62% | 23,481,565 | 0.77% |
| $1,000.01 to $3,000.00 | 272,126 | 13.22% | 150,756,915 | 4.95% |
| $3,000.01 to $5,000.00 | 303,098 | 14.72% | 261,807,599 | 8.60% |
| $5,000.01 to $10,000.00 | 573,287 | 27.85% | 813,894,960 | 26.75% |
| > $10,000.00 | 711,245 | 34.55% | 1,787,958,531 | 58.77% |
| Totals | 2,058,597 | 100.00% | $3,042,735,743 | 100.00% |
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Composition by Credit Limit
As at December 31, 2024
(unaudited)
Custodial Pool
| Credit Limit | Number of Accounts | Percentage of Total Accounts | Total Receivables Outstanding | Percentage of Total Receivables Outstanding |
|---|---|---|---|---|
| ≤ $500.00 | 42,418 | 2.08% | $ 5,466,361 | 0.17% |
| $500.01 to $1,000.00 | 155,976 | 7.66% | 25,795,706 | 0.79% |
| $1,000.01 to $3,000.00 | 272,601 | 13.39% | 167,462,518 | 5.12% |
| $3,000.01 to $5,000.00 | 304,217 | 14.94% | 288,680,401 | 8.83% |
| $5,000.01 to $10,000.00 | 569,724 | 27.98% | 880,306,924 | 26.93% |
| > $10,000.00 | 691,582 | 33.95% | 1,901,577,735 | 58.16% |
| Totals | 2,036,518 | 100.00% | $3,269,289,645 | 100.00% |
Composition by Age of Accounts
As at March 31, 2025
(unaudited)
Custodial Pool
| Age of Accounts (1) | Number of Accounts | Percentage of Total Accounts | Total Receivables Outstanding | Percentage of Total Receivables Outstanding |
|---|---|---|---|---|
| 6 months or less | — | 0.00% | $ — | 0.00% |
| >6 months to 12 months | 15,260 | 0.74% | 21,992,253 | 0.72% |
| >12 months to 24 months | 43,646 | 2.12% | 69,039,749 | 2.27% |
| >24 months to 36 months | 51,323 | 2.49% | 93,576,195 | 3.08% |
| >36 months to 48 months | 90,424 | 4.39% | 157,718,088 | 5.18% |
| >48 months | 1,857,944 | 90.26% | 2,700,409,458 | 88.75% |
| Totals | 2,058,597 | 100.00% | $3,042,735,743 | 100.00% |
(1) Age of Accounts is based on the opening date of the Accounts.
Composition by Age of Accounts
As at December 31, 2024
(unaudited)
Custodial Pool
| Age of Accounts (1) | Number of Accounts | Percentage of Total Accounts | Total Receivables Outstanding | Percentage of Total Receivables Outstanding |
|---|---|---|---|---|
| 6 months or less | 5,049 | 0.25% | $ 7,207,879 | 0.22% |
| >6 months to 12 months | 19,443 | 0.95% | 29,039,707 | 0.89% |
| >12 months to 24 months | 46,201 | 2.27% | 79,917,007 | 2.44% |
| >24 months to 36 months | 67,079 | 3.29% | 127,846,579 | 3.91% |
| >36 months to 48 months | 81,895 | 4.02% | 154,560,703 | 4.73% |
| >48 months | 1,816,851 | 89.22% | 2,870,717,770 | 87.81% |
| Totals | 2,036,518 | 100.00% | $3,269,289,645 | 100.00% |
(2) Age of Accounts is based on the opening date of the Accounts.
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Composition by Geographic Distribution
As at March 31, 2025
(unaudited)
Custodial Pool
| Province | Number of Accounts | Percentage of Total Accounts | Total Receivables Outstanding | Percentage of Total Receivables Outstanding |
|---|---|---|---|---|
| Alberta | 279,393 | 13.57% | $ 427,869,172 | 14.06% |
| British Columbia | 301,891 | 14.66% | 411,010,276 | 13.51% |
| Manitoba | 100,682 | 4.89% | 158,513,214 | 5.21% |
| New Brunswick | 33,647 | 1.63% | 51,215,131 | 1.68% |
| Newfoundland & Labrador | 13,068 | 0.63% | 20,847,319 | 0.69% |
| Nova Scotia | 55,538 | 2.70% | 87,865,085 | 2.89% |
| Northwest Territories | 950 | 0.05% | 1,697,487 | 0.06% |
| Nunavut | 131 | 0.01% | 195,028 | 0.01% |
| Ontario | 1,060,157 | 51.51% | 1,634,092,138 | 53.69% |
| Prince Edward Island | 8,820 | 0.43% | 15,570,733 | 0.51% |
| Quebec | 145,277 | 7.06% | 140,919,995 | 4.63% |
| Saskatchewan | 56,627 | 2.75% | 88,452,776 | 2.91% |
| Yukon | 2,339 | 0.11% | 4,461,077 | 0.15% |
| Other (1) | 77 | 0.00% | 26,312 | 0.00% |
| Totals | 2,058,597 | 100.00% | $3,042,735,743 | 100.00% |
(1) This category is in respect of those accounts for which the Obligor's statement address is outside Canada.
Composition by Geographic Distribution
As at December 31, 2024
(unaudited)
Custodial Pool
| Province | Number of Accounts | Percentage of Total Accounts | Total Receivables Outstanding | Percentage of Total Receivables Outstanding |
|---|---|---|---|---|
| Alberta | 275,962 | 13.55% | $ 449,411,374 | 13.75% |
| British Columbia | 298,351 | 14.65% | 433,858,064 | 13.27% |
| Manitoba | 99,546 | 4.89% | 169,917,032 | 5.20% |
| New Brunswick | 33,302 | 1.64% | 55,178,003 | 1.69% |
| Newfoundland & Labrador | 13,001 | 0.64% | 22,229,599 | 0.68% |
| Nova Scotia | 55,013 | 2.70% | 93,208,037 | 2.85% |
| Northwest Territories | 947 | 0.05% | 1,816,593 | 0.06% |
| Nunavut | 131 | 0.01% | 215,736 | 0.01% |
| Ontario | 1,049,152 | 51.51% | 1,777,395,119 | 54.35% |
| Prince Edward Island | 8,763 | 0.43% | 16,763,155 | 0.51% |
| Quebec | 143,975 | 7.07% | 150,228,220 | 4.60% |
| Saskatchewan | 55,992 | 2.75% | 94,516,145 | 2.89% |
| Yukon | 2,306 | 0.11% | 4,526,162 | 0.14% |
| Other (1) | 77 | 0.00% | 26,406 | 0.00% |
| Totals | 2,036,518 | 100.00% | $3,269,289,645 | 100.00% |
(1) This category is in respect of those accounts for which the Obligor's statement address is outside Canada.
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Account Performance
The following tables set forth the historical performance of the Accounts in which the Trust maintains undivided co-ownership interests through secured loans for each of the indicated periods as provided by PC Bank.
Revenue Experience for the Custodial Pool
The revenue experience presented below is on a "billed basis", before deduction for losses, and will be affected by numerous factors, including the periodic finance charges, the amounts of fees paid by cardholders and the percentage of cardholders who pay off their balances in full each month and do not incur periodic charges on purchases.
Revenue Experience for the Portfolio
(unaudited)
(in thousands of Canadian dollars)
| Quarter ended March 31, 2025 | Quarter ended March 31, 2024 | |
|---|---|---|
| Amount Billed | $204,896 | $188,698 |
| Average Receivables Outstanding (1) | $3,060,601 | $2,885,954 |
| Average Revenue Yield (2)(3) | 27.15% | 26.30% |
(1) The average Receivables outstanding for a period is the average of the monthly average Receivables outstanding for that period. The average Receivables outstanding for a month is the average of the amount of Receivables at the beginning of the month and the amount of Receivables at the end of the month.
(2) Calculated as the amount billed (Finance Charge Receivables billed in the period indicated) divided by the average Receivables outstanding.
(3) Calculated on an annualized basis.
The revenues presented above are attributable to periodic finance charges and other fees billed to cardholders and include revenue attributable to Interchange. The revenues related to periodic finance charges and fees depend in part on the collective preference of cardholders to use their credit cards to finance purchases and/or receive cash advances over time rather than for convenience use (where the cardholders pay off their entire balance each month, thereby avoiding periodic finance charges). Revenues also depend in part on the cardholders' use of other services offered by PC Bank. Accordingly, revenues will be affected by future changes in the types of charges and fees assessed on the Accounts by PC Bank and other factors.
Revenue and the revenue yield in the custodial pool increased for the three months ended March 31, 2025 as compared to the three months ended March 31, 2024. The increase was primarily driven by higher finance charges.
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Loss and Delinquency Experience for the Custodial Pool
The loss and delinquency experience of the Accounts were as follows:
Loss Experience for the Portfolio
(unaudited)
(in thousands of Canadian dollars)
| Quarter ended March 31, 2025 | Quarter ended March 31, 2024 | |
|---|---|---|
| Average Receivables Outstanding (1) | $3,060,601 | $2,885,954 |
| Net Losses | $29,343 | $29,672 |
| Net Losses as a percentage of Average Receivables Outstanding (2)(3) | 3.89% | 4.14% |
(1) The average Receivables outstanding for a period is the average of the monthly average Receivables outstanding for that period. The average Receivables outstanding for a month is the average of the amount of Receivables at the beginning of the month and the amount of Receivables at the end of the month.
(2) Calculated as the amounts which became Charged-Off Amounts in the relevant period, due to credit or bankruptcy but excluding amounts relating to fraudulent accounts, less the amount of any recoveries during the period, and divided by the average Receivables outstanding.
(3) Calculated on an annualized basis.
Delinquencies for the Custodial Pool as a Percentage of Total Receivables
(unaudited)
| Days Delinquent(1) | As at March 31, 2025 | As at March 31, 2024 | ||
|---|---|---|---|---|
| Total Receivables Outstanding | Percentage of Total Receivables Outstanding | Total Receivables Outstanding | Percentage of Total Receivables Outstanding | |
| Current(2) | $2,905,092,450 | 95.47% | $2,686,918,038 | 94.87% |
| 1 day to 29 days | 75,647,376 | 2.49% | 84,759,696 | 2.99% |
| 30 days to 59 days | 20,026,442 | 0.66% | 20,942,031 | 0.74% |
| 60 days to 89 days | 12,742,696 | 0.42% | 13,023,968 | 0.46% |
| 90 + days | 29,226,779 | 0.96% | 26,565,152 | 0.94% |
| Totals: | $3,042,735,743 | 100.00% | $2,832,208,885 | 100.00% |
(1) Delinquency statistics are based on cardholder balances as of the month end date.
(2) Includes accounts with zero and credit balances.
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Cardholder Monthly Payment Rates for the Accounts
The payment rates of the Accounts were as follows:
Cardholder Monthly Payment Rates for the Accounts
(unaudited)
| Quarter ended March 31, 2025 | Quarter ended March 31, 2024 | |
|---|---|---|
| Payment Rate (1) | 62.96% | 62.15% |
(1) Calculated as the average of the monthly payments for the reporting period divided by the average of the monthly Receivables at the beginning of the month for the reporting period. Monthly payment includes the Principal Collections and Finance Charge Collections, but excludes Interchange for each month.
Summary of Quarterly Results
The following is a summary of the Trust's comprehensive income and undistributed income and net assets for the quarters then ended as indicated:
Statements of Comprehensive Income and Net Assets Attributable to the Trust's Beneficiary
For the quarters ended
(unaudited)
(in thousands of Canadian dollars)
| 2025 | 2024 | 2023 | ||||||
|---|---|---|---|---|---|---|---|---|
| Mar | Dec | Sept | June | Mar | Dec | Sept | June | |
| REVENUES | ||||||||
| Income from | ||||||||
| Secured loans | 12,895 | 12,777 | 12,497 | 10,811 | 9,905 | 9,892 | 9,675 | 8,776 |
| Interest on short-term investments | 49 | 175 | 714 | 462 | 67 | 146 | 719 | 420 |
| Administrative expenses recovery | 209 | 590 | 193 | 211 | 227 | 49 | 290 | 182 |
| 13,153 | 13,542 | 13,404 | 11,484 | 10,199 | 10,087 | 10,684 | 9,378 | |
| EXPENSES | ||||||||
| Interest | ||||||||
| Senior medium-term notes | 11,731 | 11,738 | 11,973 | 10,204 | 9,021 | 9,081 | 9,405 | 8,317 |
| Subordinated medium-term notes | 1,213 | 1,214 | 1,238 | 1,069 | 951 | 957 | 989 | 879 |
| Administrative and other | 209 | 590 | 193 | 210 | 227 | 49 | 290 | 181 |
| 13,153 | 13,542 | 13,404 | 11,483 | 10,199 | 10,087 | 10,684 | 9,377 | |
| Excess of revenue over expenses and comprehensive income for the Trust's beneficiary | - | - | - | 1 | - | - | - | 1 |
| Undistributed income, beginning of period | - | 1 | 1 | - | - | 1 | 1 | - |
| Distribution to income beneficiary | - | (1) | - | - | - | (1) | - | - |
| Net assets, end of period | - | - | 1 | 1 | - | - | 1 | 1 |
For the three months ended March 31, 2025, revenues of the Trust were $13.15 million (for the three months ended March 31, 2024 – $10.20 million) and expenses of the Trust were $13.15 million (for the three months ended March 31, 2024 – $10.20 million). The revenues of the Trust were sufficient to meet all obligations of the Trust.
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Statements of Net Assets
As at quarter end
(in thousands of Canadian dollars)
| 2025 | 2024 | 2023 | ||||||
|---|---|---|---|---|---|---|---|---|
| 31-Mar | 31-Dec | Sept 30 | June 30 | Mar 31 | Dec 31 | Sept 30 | June 30 | |
| ASSETS | ||||||||
| Cash | 105 | 1 | 2 | 2 | 2 | 1 | 2 | 2 |
| Cash and short-term investments held in accumulation and reserve accounts | 12,349 | 6,802 | 11,931 | 176,616 | 8,778 | 9,173 | 8,252 | 180,018 |
| Other receivables | 147 | 358 | 356 | 288 | 208 | 390 | 445 | 375 |
| Accrued interest receivable | 2,074 | 2,048 | 2,385 | 2,753 | 1,623 | 1,603 | 1,656 | 1,640 |
| Secured loans | 1,450,000 | 1,450,000 | 1,450,000 | 1,533,333 | 1,350,000 | 1,350,000 | 1,350,000 | 1,433,333 |
| 1,464,675 | 1,459,209 | 1,464,674 | 1,712,992 | 1,360,611 | 1,361,167 | 1,360,355 | 1,615,368 | |
| LIABILITIES | ||||||||
| Other payables | 1,002 | 360 | 357 | 914 | 835 | 391 | 446 | 1,001 |
| Accrued interest payable - senior notes | 12,395 | 8,001 | 12,980 | 10,924 | 8,845 | 9,741 | 8,965 | 13,012 |
| Accrued interest payable - subordinated notes | 1,278 | 848 | 1,336 | 1,153 | 931 | 1,035 | 943 | 1,354 |
| Senior medium-term notes | 1,348,500 | 1,348,500 | 1,348,500 | 1,581,000 | 1,255,500 | 1,255,500 | 1,255,500 | 1,488,000 |
| Subordinated medium-term notes | 101,500 | 101,500 | 101,500 | 119,000 | 94,500 | 94,500 | 94,500 | 112,000 |
| 1,464,675 | 1,459,209 | 1,464,673 | 1,712,991 | 1,360,611 | 1,361,167 | 1,360,354 | 1,615,367 | |
| Net Assets | - | - | 1 | 1 | - | - | 1 | 1 |
Financial Instruments
The Trust is exposed to the following risks as a result of holding financial instruments:
Credit Risk
Credit risk is the risk of loss associated with a counterparty's inability to fulfill their payment obligations. The Trust is exposed to credit risk due to its secured loans. As at March 31, 2025, the Trust's maximum exposure to credit risk was $1,464.68 million (December 31, 2024 – $1,459.21 million). A financial asset measured at amortized cost is assessed at each reporting date to determine whether a loss allowance for expected credit losses should be recorded. The Trust evaluates credit losses using an expected credit loss impairment model, taking into consideration Series-specific enhancements in the form of overcollateralization, excess spread, and the amounts deposited in a reserve account. The Reserve Account for a Series will remain at a zero balance until the occurrence of a Reserve Event or Pre-Accumulation Reserve Period for such Series. The balance in the Reserve Account for a Series will be available to the Trust to satisfy payments of interest, principal and other expenses if Collections and other amounts received in respect of the related secured loan are insufficient to meet the Trust's obligations pursuant to the terms of a related Series of Notes. In the event that the distributions from a secured loan, including funds from the related Reserve Account, are exceeded by losses allocated to such secured loan, the losses would be absorbed by the Noteholders of the related Series. No Reserve or amortization event has occurred in respect of the outstanding Series.
As at March 31, 2025, there is no portion of the payments under the secured loans either past due or impaired (December 31, 2024 – nil).
None of the financial instruments that are fully performing have been renegotiated during the quarters ended March 31, 2025 and 2024.
Market and Interest Rate Risk
Market risk is the risk that the fair values or cash flows of a financial instrument will fluctuate due to changes in market prices. Market risk reflects interest rate risk, currency risk and other price risks.
The interest rate risk arising from secured loans is minimal as the interest charged to the customers on the pool of receivables securing the secured loans bears interest at a fixed
rate. The Trust is also exposed to the interest rate risk through the investment earnings on eligible investments.
Interest rate risk arising from the Trust's medium-term note liabilities is minimal as the interest payments to the Noteholders bears interest at a fixed rate. If interest rates had been higher or lower as of March 31, 2025, the interest expense on the Notes would have been unchanged. The payment requirements of the Notes are satisfied by the Collections and other amounts received in respect of the Trust's secured loans in the pool of credit card receivables and a priority claim on any balances retained in the related Reserve Accounts.
The Trust's ability to bear interest rate risk exposure can be measured through the excess spread percentage ("Excess Spread Percentage"). If the Excess Spread Percentage for a Series of Notes were to fall below 5%, a Reserve Event would occur in respect of such Series; this would result in a required cash reserve amount ("Required Reserve Account Balance"), funded from the excess spread generated by the underlying credit card receivables, to be held in the Reserve Account for the related Series of Notes. If the Excess Spread Percentage in respect of a Series were to fall below 0%, an amortization event would be triggered, accelerating the repayment of that Series of Notes. As at March 31, 2025 and 2024, the three month average Excess Spread Percentage for each Series outstanding on such date was as follows:
March 31, 2025 March 31, 2024
| (unaudited) | ||
|---|---|---|
| % | % | |
| Series 2019-1 | N/A | 16.96 |
| Series 2020-1 | 19.40 | 17.96 |
| Series 2021-1 | 19.14 | 17.70 |
| Series 2022-1 | 15.83 | 14.43 |
| Series 2023-1 | 15.46 | 14.06 |
| Series 2024-1 | 15.68 | N/A |
There would be no material impact on the Trust's income or assets as a result of interest rate changes on the short term investments.
Liquidity Risk
Liquidity and funding risk is the risk that the Trust may be unable to generate or obtain sufficient cash or its equivalent in a timely and cost-effective manner to meet the Trust's commitments as they come due.
The Trust is exposed to liquidity risk resulting from its secured loans. The payment rate of the revolving credit card receivables that comprise the pool that underlies the secured loans provides an indication of the liquidity risk to which the Trust is exposed. Payment rate is calculated as the average of the monthly payments for the reporting period divided by the average of the monthly receivables at the beginning of the month for the reporting period. Monthly payment includes the principal collections and finance charge collections but excludes interchange for each month. For the three months ended March 31, 2025, the payment rate of the pool of receivables was 62.96% (for the three months ended March 31, 2024 – 62.15%). The higher the payment rate the shorter the time frame for the Trust and
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Noteholders to receive full repayment of principal on the outstanding Notes during an amortization event.
The Trust has only issued medium term note liabilities and has not issued asset-backed commercial paper, thereby limiting its liquidity risk. Entitlements from the pool of credit card receivables are deposited monthly to a bank account held in the name of the Trust, and these amounts are sufficient to meet the Trust's obligations to pay the interest on each Series of Notes. An Accumulation Period in respect of the Series 2020-1, the Series 2021-1, the Series 2022-1, the Series 2023-1 and the Series 2024-1 Co-Ownership Interests begins three months prior to the Targeted Principal Distribution Date for such Series of Notes, or such earlier or later day declared as such by the related Series Co-Owner. During the Accumulation Period, the Trust accumulates Collections sufficient to repay all amounts owing under that Series of Notes, together with all related accrued Trust Expenses and Funding Costs by the related applicable Targeted Principal Distribution Date.
In addition, in respect of a Series, a Pre-Accumulation Reserve Period will commence on the earlier of [i] the day specified by the related Servicer; or [ii] three months prior to the related Accumulation Commencement Date, during which the related Required Reserve Account Balance will be increased by an amount stipulated in the related Series Co-Ownership Agreement. The amount will be used to fund any shortfall in payment on the related Notes due to any difference between the interest payable on the related Notes and the interest earned on the Eligible Investments in respect of amounts held in the related Accumulations Account. The portion of the Reserve Account balance not required by the Trust is paid to the Seller after the related Series of Notes are repaid in full. The Reserve Account is an account of PC Bank, held subject to the control of the custodian.
To enhance or help obtain the desired credit ratings, certain securities of the Trust may benefit from enhancement in the form of subordinated notes. The Series 2020-1 Notes, the Series 2021-1 Notes, the Series 2022-1 Notes, the Series 2023-1 Notes and the 2024-1 Notes consist of senior Class A Notes, subordinated Class B Notes, and subordinated Class C Notes. The Class C Notes of a Series serve as credit support for the related Class A and Class B Notes and the Class B Notes and Class C Notes of a Series serve as credit support for the related Class A Notes. For the Series 2020-1 Notes, the Series 2021-1 Notes, the Series 2022-1 Notes, the Series 2023-1 Notes and the Series 2024-1 Notes, during the Amortization Period, interest will be paid sequentially first to the Class A Notes, then the Class B Notes and last to the Class C Notes. After the foregoing payments of interest have been paid for the Series 2020-1 Notes, the Series 2021-1 Notes, the Series 2022-1 Notes, the Series 2023-1 Notes and the Series 2024-1 Notes, respectively, during the Amortization Period, payments of principal will be made first in respect of the Class A Notes until fully repaid, then in respect of the Class B Notes until fully repaid and last to the Class C Notes.
As at March 31, 2025, the Trust has not entered into any liquidity agreements. The income earned by the Trust is comprised of interest earned on the secured loans backed by finance charges, interchange and fee income from the Co-Ownership Assets, and interest earned on short term investments and balances in the Reserve Accounts and Accumulations Accounts and is sufficient to meet the liquidity requirements of the Trust.
The Trust is not exposed to losses arising from foreign exchange rates, equity or commodity prices. All of the Trust's transactions are denominated in Canadian currency and the Trust does not invest in either equities or commodities.
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Related Party Transactions
The Trust held $1.45 billion in secured loans at March 31, 2025 (December 31, 2024 – $1.45 billion), which represent a security claim on the co-ownership interest in credit card receivables originated by PC Bank, a related party. The secured loans represent the Trust's right to receive distributions with respect to the co-ownership entitlements to satisfy its interest and principal payment obligations under the related Notes and to pay its related expenses, including payment to the beneficiary, to a maximum of the Series' allocated portion of all collections made on the total pool of credit card receivables. The Trustee of the Trust has delegated its responsibility for the day-to-day administration of the Trust to PC Bank, as Financial Services Agent. PC Bank has delegated certain of its responsibilities to CIBC, as Financial Services Sub-Agent. PC Bank bears and pays for all incremental transaction costs associated with the issuance of notes by the Trust and the acquisition of secured loans. Transactions with related parties have occurred in the normal course of operations and are recorded at the contracted amounts. PC Bank and/or its affiliates may from time to time purchase asset-backed securities issued by the Trust, either at the time of their initial issuance or in the secondary market.
The Servicer of the credit card receivables is responsible for servicing, monitoring and collecting credit card receivables. PC Bank, as Servicer, is not paid a servicing fee by the Trust, as the credit card receivables were sold on a fully serviced basis. Administration and other expenses incurred by the Trust are reimbursed by PC Bank.
Trends, Commitments, Events and Uncertainties
The Trust participates in the Canadian securitization market. PC Bank, which provides certain financial services to the Trust, and CIBC, which carries out certain financial services for and on behalf of the Trust as Financial Services Sub-Agent, have a wide range of expertise in the financial services industry. CIBC, PC Bank and/or its affiliates keep abreast of trends in financial markets in general and ascertain risks and uncertainties in the securitization market in particular.
The Trust, PC Bank and/or its affiliates assess Canadian securitization market conditions on an on-going basis and may, from time to time, structure and bring to market new issues of asset-backed securities. The types of securities and number of issues will depend on various factors, including market demand, the availability of sufficient Collateral to back the securities, overall financial market conditions, the activities of competitors and the cost of related services. The Trust does not operate any other business, and is restricted from doing so, and any securities issued by it will be secured solely by the Trust's secured loans in the Collateral.
The outstanding asset-backed securities are secured solely by the Trust's secured loans in the Collateral. This is subject to a custodial agreement or similar arrangement. This relationship protects the Trust from exposure to high risk businesses. The Trust is, however, subject to all ordinary commercial risks, including, without limitation the following: (a) fraud relating to the assets or by the participants in the securitization transactions; (b) changes in credit card use and payment patterns by cardholders resulting from economic, legal and social factors; (c) competition in the credit card industry and emerging payment technologies; (d) changes to the terms of the Account Assets; (e)
20
violations of consumer protection laws; (f) lack of performance by contracted parties; and (g) ongoing changes to interchange rates.
Critical Accounting Estimates
All estimates and assumptions that affect the reported amounts of assets and liabilities are best estimates undertaken in accordance with the applicable standard. Significant estimates and judgments are evaluated on a continuous basis and are as follows:
- In determining the carrying value of the secured loans under the effective interest method, future cash flows are estimated based on past experience and other events, including expectations with regards to future events.
- In determining whether an impairment loss needs to be recorded on loans, judgment is made as to whether there is any observable data indicating an impairment trigger followed by a measurable decrease in estimated future cash flows from the loans.
Material accounting policies adopted by the Trust are described in note 3 of the Trust's Financial Statements.
Off-Balance Sheet Arrangements
The Trust has not entered into any off-balance sheet arrangements.
Subsequent Events
On April 21, 2025, the Trust purchased a co-ownership interest in the amount of $300 million in PC Bank originated credit card receivables (the "Series 2025-1 Co-Ownership Interest"). Pursuant to a base shelf prospectus dated March 20, 2025 and a corresponding pricing supplement dated April 15, 2025, the purchase of the Series 2025-1 Co-Ownership Interest was funded through the issuance of $279 million 3.917% Credit Card Receivables-Backed Class A Notes, Series 2025-1; $10.5 million 4.767% Credit Card Receivables-Backed Class B Notes, Series 2025-1; and $10.5 million 6.069% Credit Card Receivables-Backed Class C Notes, Series 2025-1.
On April 1, 2025, Series 2020-1 commenced its Accumulation Period for the $300 million Notes due on July 17, 2025. The Controlled Accumulation Principal Amount of $100 million was deposited to the Accumulations Account on May 20, 2025.