Monthly Overview
Credit performance across KBRA’s Prime and Non-Prime U.S. Auto Loan ABS Indices improved in February compared to January. Net losses, early-stage (30-59 day) delinquencies, and late-stage (60+ day) delinquencies all declined in our non-prime index, decreasing 6 basis points (bps), 49 bps, and 1 bp, respectively, on a month-over-month (MoM) basis. In our prime index, annualized net losses and late-stage delinquencies remained stable, each rising only 1 bp MoM, while early-stage delinquencies improved, falling 9 bps. However, both our prime and non-prime indices weakened compared to year-ago levels, with all credit performance metrics rising.
Auto loan delinquencies and net losses have begun their typical seasonal trend of improving from their usual peak levels in December and January. We expect this trend to continue through Q2 as individuals receive their tax refunds, providing an additional source of cash to catch up on past due payments.
Figures 1-14 show performance…