KBRA Releases Research – Recurring Revenue Loan Metrics Dashboard: Q4 2024

KBRA releases an updated report tracking key metrics within recurring revenue loan (RRL) securitizations.

This report, an update to our Q3 analysis, continues to track and present these metrics in a dashboard format, sourced from quarterly collateral loan tapes provided by the issuers of KBRA-rated RRL securitizations. Changes in these metrics can offer insight into the overall health and credit quality of the portfolios. The Q3 analysis was based on collateral tapes dated through September 2024, while this update incorporates reports dated through December 2024.

Annualized recurring revenue (ARR) is down for the third consecutive reporting period but still remains above the historical average. Other key metrics, including cash and liquidity, continue to decline, reaching or falling below historical averages. These declines are somewhat expected as companies draw down cash buffers accumulated in anticipation of a higher rate environment. On a positive note, overall leverage—measured by both debt/ARR and loan-to-value (LTV)—has decreased, with average LTV recording its first significant quarter-over-quarter (QoQ) decline since 2021. These movements align with broader trends observed across KBRA’s middle market (MM) borrower universe.

Click here to view the report.

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