Another subprime auto ABS issuer closed its dealerships last week. Back-up servicers can help to protect investors from failing issuers, though there were some complications with a recent servicing transfer.

Issuance of ABS backed by music royalties will continue to grow, according to KBRA. Also, streaming royalty rates, a large share of music catalog revenues, are expected to increase in coming years.

Speakers on a recent dv01 panel said unemployment would be a key factor in performance moving forward. Unsecured consumer loans are demonstrating some weakness, while auto performance is normalizing.

CRT transactions from Western Alliance Bank and Pacific Western Bank face scrutiny amid bank failures; impairments on unsecured consumer loans in ABS decline; Credit Suisse and what’s to come.

The 60-day-plus delinquency rate on subprime auto ABS hit a record in December. Performance is expected to decline this year and non-investment-grade ratings could face downgrades.

S&P has assigned AAA ratings to the latest ABS from Octane Lending. The deal is stocked with loans on various powersports vehicles, such as ATVs.

Delinquencies and impairments continued to increase on unsecured consumer ABS and subprime auto ABS at the end of 2022. Credit card ABS performance is holding up better.

Fitch Ratings said the most robust subprime auto ABS issuers will probably perform well even in a downturn, but several risks lie ahead for the sector.

High impairments and low cure rates in consumer loan ABS aren’t a sign of similar underperformance in other sectors, according to dv01.

SFA is seeking feedback on revisions to TRID Grid for residential MBS; timeshare ABS properties and borrowers are under evaluation following Hurricane Ian.