Rating services are requiring higher credit enhancement levels and taking negative actions on outstanding deals due to problems stemming from the coronavirus. Fitch finalized new criteria for residential MBS late last week.

An advisory panel has called for greater transparency around credit ratings. SEC officials say the reforms could be difficult to implement.

Ratings analysts at Morningstar allegedly engaged in sales and marketing activities in 2015 and 2016, a big no-no.

Auto ABS offerings returning to the market are being met with strong demand from investors, prompting deal sizes to be increased.

The coronavirus-triggered lockdown has prompted rating agencies to increase loss expectations for newly issued auto ABS.

When issuance of non-agency MBS and ABS resumes, issuers will face tougher standards from rating services due to the coronavirus.

The performance of MBS and ABS looks likely to suffer, with delinquencies projected to increase and rating downgrades a possibility.

The SEC’s Office of Credit Ratings is exploring how it can address conflicts of interest in ratings of MBS and ABS. An increase in performance-related disclosures and boosting unsolicited ratings are being considered.

JPMorgan Chase has issued its first ABS transaction backed by credit card receivables through Chase Issuance Trust since May 2018. A wildcard to the deal, however, is a pending lawsuit involving the issuance trust.

The SEC is facing pressure to address “ratings shopping” in the MBS and ABS markets. Big rating services are not keen to switch from the issuer-pays model.