DOW JONES NEWSWIRES 
 

Alliance Data Systems Corp. (ADS) issued $950 million of fixed-rate term credit-card-loan backed securities to free up liquidity at the company, which recently has been hurt by currency changes and higher loss rates.

The securities consist of three series with an average maturity of just under three years and an average interest rate of just under 4%. About $750 million of the notes are rated AAA and eligible under the U.S. government's Term Asset-Backed Securities Loan Facility program.

The Federal Reserve's TALF program, launched in March, offers investors loans at attractive rates to buy newly created asset-backed securities. Most of the consumer loan-backed deals sold this year were eligible for TALF, which helped revitalize the securitization market and improved the availability of credit for consumers.

The remaining $200 million of investment-grade securities sold by ADS will be retained by the company and financed through Federal Deposit Insurance Corp.-insured certificates of deposit.

President and Chief Executive Ed Heffernan said "accessing the term markets frees-up additional excess liquidity form our other sources of funding." This supports efforts to "augment" its credit-card unit business, he said.

Friday's offering and a $709 million issue unveiled in April brings the company's term fixed-rate ABS issuance to $1.7 billion. The company also has $1.2 billion in term fixed-rate bonds outstanding, leaving ADS' private-label credit-card portfolio with two-thirds of its funding through ABS.

Shares closed at $59.77 on Thursday and didn't trade premarket. The stock is down 10% over the past year, though it has more than doubled since March.

-By Tess Stynes, Dow Jones Newswires; 212-416-2481; tess.stynes@dowjones.com