Strong performance of outstanding marketplace consumer loan ABS is bringing issuers and investors back to the market. But default risks will likely increase through the remainder of the year, according to analysts.
Auto-loan securitization remained the biggest ABS sector, but business-finance deals recorded the biggest third-quarter increase. Delta’s air-mile deal set the pace. (Includes two data charts.)
Growing student debt has exposed ABS backed by such loans to elevated risks, increasing the possibility the notes will not pay off by their final maturities.
Fitch has downgraded 37% of the airline ABS it rates. Kroll and S&P also recently conducted sweeping downgrades. The rating services said air travel isn’t expected to recover until 2023 at the earliest.
Production levels surged for agency 1-4-family MBS, non-mortgage ABS and commercial MBS from the second to the third quarter. Nonbanks continued to dominate the agency market. Includes three data charts.)
RSS