Chase Bank USA, National Association
The information in this prospectus is not complete and may be changed. This prospectus is not an offer to sell these securities and we are not seeking an offer to buy these securities in any state where the offer or sale is not permitted.
SUBJECT TO COMPLETION, DATED MAY 10, 2017
Prospectus dated [
], 2017
Chase Issuance Trust
Issuing Entity
CIK Number: 0001174821
Chase Card Funding LLC
Depositor and Transferor
CIK Number: 0001658982
Chase Bank USA, National Association
Sponsor, Originator, Administrator and Servicer
CIK Number: 0000869090
CHASEseries
$500,000,000 Class A(2017-3) Notes
You should consider the discussion under "Risk Factors" beginning on page 15 of this prospectus before you purchase any Class A(2017-3) notes.
The Class A(2017-3) notes are obligations of the issuing entity only and are not interests in or obligations of Chase Bank USA, National Association, Chase Card Funding LLC, any of their affiliates or any other person or entity.
The Class A(2017-3) notes are not insured or guaranteed by the Federal Deposit Insurance Corporation or any other governmental agency or instrumentality.
The issuing entity will issue and sell: Principal amount Interest rate Interest payment dates
Scheduled principal payment date Legal maturity date Expected issuance date Price to public Underwriting discount Proceeds to the issuing entity
Class A(2017-3) Notes
$500,000,000 (subject to increase)
% per annum
15th day of each calendar month, beginning
July 17, 2017
June 15, 2020
June 15, 2022
, 2017
$
(or
%)
$
(or
%)
$
(or
%)
The Class A(2017-3) notes, or the "offered notes," are a tranche of the Class A notes of the CHASEseries.
For a description of how the amount of interest payable on the Class A(2017-3) notes is determined see "Transaction Summary" and "Summary --Interest" in this prospectus.
The assets of the issuing entity include:
? Credit card receivables that arise in certain revolving credit card accounts owned by Chase Bank USA, National Association; and
? Funds on deposit in the collection account, the excess funding account, the interest funding account, the principal funding account and the Class C reserve account.
The assets of the issuing entity may include in the future:
? Additional credit card receivables that arise in revolving credit card accounts owned by Chase Bank USA, National Association or by one of its affiliates; and
? One or more collateral certificates, each representing an undivided interest in a securitization special purpose entity whose assets consist primarily of credit card receivables arising in revolving credit card accounts owned by Chase Bank USA, National Association or by one of its affiliates.
Enhancement for the Class A(2017-3) notes is provided in the form of outstanding subordinated notes as described in "Transaction Summary" and "Summary--Subordination, Credit Enhancement" in this prospectus.
The issuing entity is not now, and immediately following the issuance of the Class A(2017-3) notes pursuant to the indenture will not be, a "covered fund" for purposes of regulations adopted under Section 13 of the Bank Holding Company Act of 1956, as amended, commonly known as the "Volcker Rule." In reaching this conclusion, although other statutory or regulatory exemptions under the Investment Company Act of 1940, as amended, and under the Volcker Rule and its related regulations may be available, the issuing entity has relied on the exemption from registration set forth in Rule 3a-7 under the Investment Company Act of 1940, as amended. See "Summary--Certain Investment Company Act Considerations" and "Certain Investment Company Act Considerations" in this prospectus.
Neither the SEC nor any state securities commission has approved or disapproved of the Class A(2017-3) notes or determined if this prospectus is truthful, accurate or complete. Any representation to the contrary is a criminal offense.
J.P. Morgan
Underwriters
[
]
[
]
Table of Contents
Important Notice about Information Presented in this Prospectus . . . . . . . . . . . . . . . . . . . . . . v
European Union Capital Requirements Regulation . . . . . . . . . . . . . . . . . . . . . . . . . . . v
Transaction Summary . . . . . . . . . . . . . . . . . . . . viii
Summary . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 1 The Issuing Entity . . . . . . . . . . . . . . . . 1 The Depositor and Transferor . . . . . . . 1 The Originator, Sponsor, Servicer and Administrator . . . . . . . . . . . . . . . . . 1 Indenture Trustee and Collateral Agent . . . . . . . . . . . . . . . . . . . . . . . . 1 Asset Representations Reviewer . . . . . 1 Assets of the Issuing Entity . . . . . . . . . 1 Composition of Issuing Entity Receivables . . . . . . . . . . . . . . . . . . . 2 Exceptions to Underwriting Criteria . . . . . . . . . . . . . . . . . . . . . . 2 Securities Offered by this Prospectus . . . . . . . . . . . . . . . . . . . . 2 Use of Proceeds . . . . . . . . . . . . . . . . . . 2 Series, Classes and Tranches of Notes . . . . . . . . . . . . . . . . . . . . . . . . 3 Interest . . . . . . . . . . . . . . . . . . . . . . . . . 3 Principal . . . . . . . . . . . . . . . . . . . . . . . . 3 Revolving Period . . . . . . . . . . . . . . . . . 4 Transferor Amount . . . . . . . . . . . . . . . 4 Required Transferor Amount . . . . . . . 4 Minimum Pool Balance . . . . . . . . . . . . 5 Risk Factors . . . . . . . . . . . . . . . . . . . . . 5 Servicing Fee . . . . . . . . . . . . . . . . . . . . 5 Asset Representations Reviewer Fees . . . . . . . . . . . . . . . . . . . . . . . . . 6 Nominal Liquidation Amount . . . . . . . 6 Available Finance Charge Collections and Application . . . . . . . . . . . . . . . . 6 Application of Available Principal Collections . . . . . . . . . . . . . . . . . . . 8 Subordination, Credit Enhancement . . 10 Required Subordinated Amount . . . . . 10 Limit on Repayment of All Notes . . . . 11 Optional Redemption and Early Amortization of Offered Notes . . . . 11 Events of Default . . . . . . . . . . . . . . . . . 11 Events of Default Remedies . . . . . . . . 12
Limited Recourse to the Issuing Entity; Security for the Offered Notes . . . . . . . . . . . . . . . . . . . . . . . 12
Denominations . . . . . . . . . . . . . . . . . . 13 Record Date . . . . . . . . . . . . . . . . . . . . 13 Ratings . . . . . . . . . . . . . . . . . . . . . . . . 13 U.S. Federal Income Tax
Consequences . . . . . . . . . . . . . . . . . 13 ERISA Considerations . . . . . . . . . . . . 13 Certain Investment Company Act
Considerations . . . . . . . . . . . . . . . . 13
Risk Factors . . . . . . . . . . . . . . . . . . . . . . . . . . . . 15
Glossary . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 33
The Issuing Entity . . . . . . . . . . . . . . . . . . . . . . . 33 General . . . . . . . . . . . . . . . . . . . . . . . . 33 The Trust Agreement . . . . . . . . . . . . . 34 Issuing Entity Covenants . . . . . . . . . . 35 Owner Trustee . . . . . . . . . . . . . . . . . . . 35 Bankruptcy Considerations . . . . . . . . . 36 The Administrator . . . . . . . . . . . . . . . . 36
Chase Card Funding LLC . . . . . . . . . . . . . . . . . 37 General . . . . . . . . . . . . . . . . . . . . . . . . 37 Transfer of the Transferor Interest and Role of Transferor from Chase USA to Chase Card Funding . . . . . 37
Chase USA . . . . . . . . . . . . . . . . . . . . . . . . . . . . 37 General . . . . . . . . . . . . . . . . . . . . . . . . 37 General Securitization Experience . . . 38 U.S. Public Securitization Program for Credit Card Receivables . . . . . . 38 Repurchases of Receivables . . . . . . . . 39
Retained Interests . . . . . . . . . . . . . . . . . . . . . . . 39 Credit Risk Retention . . . . . . . . . . . . . 39 Transferor Amount . . . . . . . . . . . . . . . 40
Chase USA's Credit Card Portfolio . . . . . . . . . 41 The Credit Card Receivables . . . . . . . 41 Origination . . . . . . . . . . . . . . . . . . . . . 42 Underwriting Criteria and Process . . . 43 Compliance with Underwriting Criteria . . . . . . . . . . . . . . . . . . . . . . 45
i
Maintenance of Credit Card Accounts . . . . . . . . . . . . . . . . . . . . . 45
Billing and Payments . . . . . . . . . . . . . 46 Collection of Delinquent Accounts . . . 48 Portfolio Information Tables . . . . . . . 49 Delinquency and Loss Experience . . . 49 Recoveries . . . . . . . . . . . . . . . . . . . . . . 52 Dilution . . . . . . . . . . . . . . . . . . . . . . . . 52 Interchange . . . . . . . . . . . . . . . . . . . . . 52 Revenue Experience . . . . . . . . . . . . . . 53 Principal Payment Rates . . . . . . . . . . . 54 Composition of Issuing Entity
Receivables . . . . . . . . . . . . . . . . . . 54 Credit Risk Management . . . . . . . . . . 56 Rule 193 Review . . . . . . . . . . . . . . . . . 57 Findings of Rule 193 Review . . . . . . . 58 Static Pool Information . . . . . . . . . . . . 58
The Indenture Trustee and Collateral Agent . . . 58 General . . . . . . . . . . . . . . . . . . . . . . . . 58 The Indenture Trustee . . . . . . . . . . . . . 59 The Collateral Agent . . . . . . . . . . . . . . 60
Asset Representations Reviewer . . . . . . . . . . . . 62
Servicing of the Receivables . . . . . . . . . . . . . . 63 General . . . . . . . . . . . . . . . . . . . . . . . . 63 Servicing Experience . . . . . . . . . . . . . 63 Payment of Fees and Expenses; Servicing Compensation . . . . . . . . 64 Certain Matters Regarding the Servicer . . . . . . . . . . . . . . . . . . . . . 64 Resignation and Removal of the Servicer; Issuing Entity Servicer Default . . . . . . . . . . . . . . . . . . . . . . 65 Outsourcing of Servicing . . . . . . . . . . 66 Evidence as to Compliance . . . . . . . . . 66
The Notes . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 67 The Notes Offered by this Prospectus . . . . . . . . . . . . . . . . . . . 67 General . . . . . . . . . . . . . . . . . . . . . . . . 67 Stated Principal Amount, Outstanding Dollar Principal Amount and Nominal Liquidation Amount . . . . 68 Interest . . . . . . . . . . . . . . . . . . . . . . . . 70 Principal . . . . . . . . . . . . . . . . . . . . . . . 71 Subordination of Interest and Principal . . . . . . . . . . . . . . . . . . . . . 71 Required Subordinated Amount . . . . . 72 Revolving Period . . . . . . . . . . . . . . . . 74
Redemption and Early Amortization of Notes; Early Amortization Events . . . . . . . . . . . . . . . . . . . . . . . 74
Events of Default . . . . . . . . . . . . . . . . 76 Events of Default Remedies . . . . . . . . 76 Final Payment of the Notes . . . . . . . . . 78 Issuances of New Series, Classes and
Tranches of Notes . . . . . . . . . . . . . 79 Payments on Notes; Paying Agent . . . 80 Record Date . . . . . . . . . . . . . . . . . . . . 80 Addresses for Notices . . . . . . . . . . . . . 80 List of Noteholders . . . . . . . . . . . . . . . 81 Voting . . . . . . . . . . . . . . . . . . . . . . . . . 81 Issuing Entity's Annual Compliance
Statement . . . . . . . . . . . . . . . . . . . . 81 Indenture Trustee's Annual Report . . . 81 Reports . . . . . . . . . . . . . . . . . . . . . . . . 82 Governing Law . . . . . . . . . . . . . . . . . . 82 Form, Exchange and Registration and
Transfer of Notes . . . . . . . . . . . . . . 82 Book-Entry Notes . . . . . . . . . . . . . . . . 83 The Depository Trust Company . . . . . 84 Clearstream Banking . . . . . . . . . . . . . . 84 Euroclear System . . . . . . . . . . . . . . . . 85 Distributions on Book-Entry Notes . . 85 Global Clearance and Settlement
Procedures . . . . . . . . . . . . . . . . . . . 86 Definitive Notes . . . . . . . . . . . . . . . . . 87 Replacement of Notes . . . . . . . . . . . . . 87 Amendments to the Indenture, the
Asset Pool One Supplement and Indenture Supplements . . . . . . . . . . 87 Tax Opinions for Amendments . . . . . . 89 Limited Recourse to the Issuing Entity; Security for the Notes . . . . . 90
Sources of Funds to Pay the Notes . . . . . . . . . . 90 General . . . . . . . . . . . . . . . . . . . . . . . . 90 Transferor Amount . . . . . . . . . . . . . . . 91 Required Transferor Amount . . . . . . . 92 Minimum Pool Balance . . . . . . . . . . . 92 Allocations of Amounts to the Excess Funding Account and Allocations of Amounts on Deposit in the Excess Funding Account . . . . . . . . 93 Increases in the Invested Amount of an Existing Collateral Certificate . . . . . . . . . . . . . . . . . . . . 93 Addition of Assets . . . . . . . . . . . . . . . 94 Removal of Assets . . . . . . . . . . . . . . . 95 Discount Receivables . . . . . . . . . . . . . 96 Issuing Entity Bank Accounts . . . . . . . 97
ii
Chase USA and Transferor Representations and Warranties . . . 98
Sale of Assets . . . . . . . . . . . . . . . . . . . 102
Deposit and Application of Funds in the Issuing Entity . . . . . . . . . . . . . . . . . . . . . . . . . 103 Deposit and Application of Funds . . . 103 Available Finance Charge Collections . . . . . . . . . . . . . . . . . . . 104 Application of Available Finance Charge Collections . . . . . . . . . . . . . 105 Targeted Deposits of Available Finance Charge Collections to the Interest Funding Account . . . . . . . . 105 Allocation to Interest Funding Subaccounts . . . . . . . . . . . . . . . . . . 106 Allocations of Reductions from Charge-Offs . . . . . . . . . . . . . . . . . . 106 Allocations of Reimbursements of Nominal Liquidation Amount Deficits . . . . . . . . . . . . . . . . . . . . . . 108 Application of Available Principal Collections . . . . . . . . . . . . . . . . . . . 108 Reductions to the Nominal Liquidation Amount of Subordinated CHASEseries Notes from Reallocations of Available Principal Collections . . . . . . . . . . . 110 Limit on Allocations of Available Principal Collections and Available Finance Charge Collections to Tranches of Notes . . . . . . . . . . . . . 111 Targeted Deposits of Available Principal Collections to the Principal Funding Account . . . . . . 111 Allocation to Principal Funding Subaccounts . . . . . . . . . . . . . . . . . . 113 Limit on Deposits to the Principal Funding Subaccount of Subordinated Notes; Limit on Repayment of all Tranches . . . . . . 114 Deposits of Withdrawals from the Class C Reserve Account to the Principal Funding Account . . . . . . 114 Withdrawals from Interest Funding Subaccounts . . . . . . . . . . . . . . . . . . 115 Withdrawals from Principal Funding Account . . . . . . . . . . . . . . . . . . . . . 115 Pro rata Payments Within a Tranche of Notes . . . . . . . . . . . . . . . . . . . . . 116 Shared Excess Available Finance Charge Collections . . . . . . . . . . . . . 116
Unapplied Excess Finance Charge Collections and Unapplied Master Trust Level Excess Finance Charge Collections . . . . . . . . . . . . . . . . . . . 116
Shared Excess Available Principal Collections . . . . . . . . . . . . . . . . . . . 117
Unapplied Master Trust Level Principal Collections . . . . . . . . . . . 117
Segregated Finance Charge Collections . . . . . . . . . . . . . . . . . . . 117
Shelf Registration Eligibility Requirements . . . 118 Transaction Requirements . . . . . . . . . 118 Registrant Requirements . . . . . . . . . . . 123
Material Legal Aspects of the Credit Card Receivables . . . . . . . . . . . . . . . . . . . . . . . . . . 123 Transfer of Credit Card Receivables . . . . . . . . . . . . . . . . . . 123 Certain Matters Relating to Conservatorship or Receivership . . . . . . . . . . . . . . . . . . 124 Certain Regulatory Matters . . . . . . . . . 126 Consumer Protection Laws . . . . . . . . . 128 Recent Events Regarding Arbitration Programs . . . . . . . . . . . . . . . . . . . . 130
Litigation and Other Proceedings . . . . . . . . . . . 130 Litigation Regarding the Sponsor and Servicer . . . . . . . . . . . . . . . . . . . . . 130 Industry Litigation . . . . . . . . . . . . . . . 131 Indenture Trustee Litigation . . . . . . . . 132
U.S. Federal Income Tax Consequences . . . . . . 133 U.S. Federal Income Tax Opinions . . 134 Consequences to U.S. Note Owners . . . . . . . . . . . . . . . . . . . . . . 134 Possible Alternative Characterizations . . . . . . . . . . . . . . 135 Consequences to Non-U.S. Note Owners . . . . . . . . . . . . . . . . . . . . . . 136 Information Reporting and Backup Withholding . . . . . . . . . . . . . . . . . . 137 Additional Withholding Requirements . . . . . . . . . . . . . . . . . 138
ERISA Considerations . . . . . . . . . . . . . . . . . . . 138 Plan Asset Issues for an Investment in the Notes . . . . . . . . . . . . . . . . . . . . 139 Potential Prohibited Transactions from Investment in Notes . . . . . . . . 139
iii
Prohibited Transactions between the Issuing Entity and a Party in Interest . . . . . . . . . . . . . . . . . . . . . . 139
Prohibited Transactions between the Plan and a Party in Interest . . . . . . 139
Investment by Plan Investors . . . . . . . 140 General Investment Considerations
for Prospective Plan Investors in the Notes . . . . . . . . . . . . . . . . . . . . 140 Tax Consequences to Plans . . . . . . . . . 141
Certain Investment Company Act Considerations . . . . . . . . . . . . . . . . . . . . . . . . 141
Certain Relationships and Related Transactions . . . . . . . . . . . . . . . . . . . . . . . . . 142
Underwriting (Plan of Distribution, Proceeds and Conflicts of Interest) . . . . . . . . . . . . . . . 142
Legal Matters . . . . . . . . . . . . . . . . . . . . . . . . 144 Where You Can Find More Information . . . 144 Incorporation of Certain Documents by
Reference . . . . . . . . . . . . . . . . . . . . . . . . . 145 Forward-Looking Statements . . . . . . . . . . . . 145 Glossary of Defined Terms . . . . . . . . . . . . . . 147 Annex I Static Pool Information . . . . . . . . . . A-I-1 Annex II Other Outstanding Classes and
Tranches . . . . . . . . . . . . . . . . . . . . . . . . . . A-II-1
iv
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