January remittance reports showed relatively stable credit performance across securitized equipment loan and lease pools during the December collection period. KBRA’s headline Equipment Loan & Lease index posted an annualized net loss (ANL) and 60+ day delinquency rate (DQ) of 0.53% and 0.75%, respectively, up 4 basis points (bps) and 11 bps month-over-month (MoM) and 44 bps and 8 bps year-over-year (YoY)(see Figure 1).
Drilling down to the sub-indices, performance was somewhat divergent with ANLs and DQs, rising 16 bps and 33 bps MoM, respectively, within our Small-Medium Ticket sub-index but remaining basically unchanged MoM within the Large Ticket sub-index. The increase in the Small-Medium Ticket index ANL and DQ was largely driven by pools with significant concentrations of stronger credit quality obligors. Collateral pools of this type may periodically exhibit administrative delinquencies that are generally not indicative of credit issues. In some cases, however, the…