Despite continued downturns in the market, researchers say they are “comfortable with the performance trends” of subprime auto ABS trusts in the industry, according to a November Deutsche Bank Markets Research report.
Issuances for auto ABS have dropped 4% behind last year’s pace — to $90 billion year to date, according to the bank’s research. Prime auto retail lease issuance totalled $37 billion YTD, while retail lease ABS is at $14 billion. Nearly, $24 billion in subprime auto ABS has priced YTD.
Auto ABS collateral performance is “stable” according to the bank’s research, and found cumulative net losses in GM Financial and Santander Consumer shelves are experiencing less than half the losses that 2007 and 2008 securities did during the great recession.
GM’s securities from 2012-2014 are showing higher losses than securities between 2010 and 2011. However, those losses are considered stable at 0.6%, 1.9%, and 4.5% respectively. Meanwhile, Santander’s securities losses acrosse the 2010-2014 vintages have remained consistent at 1.1%, 3.4%, and 7.4%, respectively.
Fitch Ratings found similar levels of depreciation across delinquencies in its monthly report, but said outstanding ABS transactions are tracking in accordance with initial forecasts for the year.
