Most new ABS investors prefer to stay in the “AAA” space, but there is a lot of value in the lower-rated tranches, Elen Callahan, director and head of U.S. consumer asset backed securities research at Deutsche Bank, told Auto Finance News.
“I am generally bullish on this [subprime] sector, and do still think there is a lot of opportunity,” she said. Callahan will provide an update on the subprime ABS market during a session at the upcoming Auto Finance Summit 2015 on Oct. 22. She will address the current level of subprime issuance and the demand for the product, as well as some of the main concerns from investors.
“The top concern today is regulatory and also whether or not we are beginning to see a turn in the consumer credit cycle,” Callahan said. “And, of course, recovery values are always a concern.”
The Auto Finance Summit and PowerSports Finance 2015 will take place Oct. 21 – 23 at Wynn Las Vegas. For more information or to register online, visit www.autofinancesummit.com.
