Kroll Bond Rating Agency (KBRA) releases research highlighting delinquency and loan modification trends in the consumer ABS sectors for which loan level data is available, namely, auto loans and marketplace consumer loans.
Despite unemployment levels well north of 10%, delinquency rates in most consumer ABS sectors have held up remarkably well, at least to date. Remittance reports released in late June (which report May collections) showed that delinquency rates either held steady or fell across most consumer ABS asset classes, with no meaningful change in charge-offs.
We believe the unprecedented level of fiscal stimulus and widespread payment assistance programs are likely the cause. However, in the absence of further stimulus and without extended loan modifications, charge-offs and losses will likely be on the rise later this year and into 2021, assuming unemployment rates remain elevated and economic activity restricted.
Click here to view the report.
About KBRA and KBRA Europe
KBRA is a full-service credit rating agency registered with the U.S. Securities and Exchange Commission as an NRSRO. In addition, KBRA is designated as a designated rating organization by the Ontario Securities Commission for issuers of asset-backed securities to file a short form prospectus or shelf prospectus. KBRA is also recognized by the National Association of Insurance Commissioners as a Credit Rating Provider and is a certified Credit Rating Agency (CRA) with the European Securities and Markets Authority (ESMA). Kroll Bond Rating Agency Europe Limited is registered with ESMA as a CRA. Kroll Bond Rating Agency Europe Limited is located at 6-8 College Green, Dublin 2, Ireland.
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