Issuance of new non-mortgage ABS dropped significantly from the second to the third quarter of 2018, although a few sectors saw increased volume, according to a new Inside MBS & ABS analysis and ranking of the market. [Includes two data charts.]

ABS issued as private placements tend to draw less demand from investors than deals registered with the Securities and Exchange Commission, but issuers have a number of incentives to bring deals as private placements, according to industry participants.

Despite the slowdown in the securitization of residential property assessed clean energy assessments, the market is in good condition because of its low credit risk and growing consumer protection, according to Morningstar Credit Ratings.

DBRS was the most active rating service in the non-agency MBS market during the first six months of 2018, according to a new Inside MBS & ABS analysis. DBRS rated 26 non-agency MBS totaling $14.08 billion during the first half of the year, which represented 43.5 percent of total issuance. Its market share was up 4.0 percentage points from 2017. Fitch Ratings grew its market share in rating non-agency MBS, which rose from 31.0 percent last year to ... [Includes two data charts]

Changes made by the Dodd-Frank reform bill, along with other legislative proposals and government actions, would have mixed credit impact on ABS backed by student loans, said Moody’s Investors Service.

Commercial banks and savings institutions added to their holdings of non-mortgage ABS during the second quarter but still play a relatively minor role in the market. [Includes two charts.]

There are fewer structural protections in today’s speculative-grade securities backed by subprime auto loans compared to below-investment grade issuances in the 1990s, according to an S&P Global analysis of the subprime auto loan ABS sector.

The non-mortgage ABS market took a breather in the second quarter as new issuance fell modestly from the red-hot pace at the start of the year, according to a new Inside MBS & ABS analysis.

After a couple of years away from ABS issuance, loanDepot and Volkswagen are providing collateral for new deals. Meanwhile, Freedom Financial Network is a first-time issuer. All are getting positive reaction from investors.

Efforts to adopt certain consumer protections at both the state and federal levels will increase credit strength for ABS backed by Property Assessed Clean Energy programs, rating services said.