According to Reuters, prime auto ABS exhibiting less volatility than in prior years.
Prime annualized net losses (ANL) crept up 3% in August over July’s level, showing much less of an increase during this historically weaker period, according to Fitch Ratings. Further, used vehicle values were strong in August, not typical for this month, helping to contain loss severity on defaulted loans.
Prime 60+ days delinquencies were 0.33% in August, unchanged from July, and 10.8% lower year-over-year (YOY), and have averaged 0.34% in 2013, down from 0.39% in 2012. As with losses, delinquencies continue to be low historically entering the weaker fall months.
Prime ANL were at 0.32% in August, just one bp higher over July. August’s rate was 28% higher YOY, but still remains low historically. Prime cumulative net losses (CNL) were 0.26% for August, 3.7% lower month-over-month (MOM) and 18.8% lower YOY. The 2013 CNL vintage is producing the best annual vintage performance to date.