April remittance reports showed further improvement in credit performance across prime and non-prime loan pools during the March collection period due to seasonal tailwinds, as borrowers continue to receive tax refunds. KBRA’s prime index annualized net losses (ANL) came in at 0.3%, down 6 basis points (bps) month-over-month (MoM) but up 13 bps year-over-year (YoY), while 60+ day delinquency rates (DQ) arrived at 0.34%, improving 5 bps MoM but edging 6 bps higher YoY (see Figure 1). Similarly, ANLs in our non-prime index fell 146 bps MoM but rose 148 bps YoY to 5.49%, while non-prime 60+ day DQs landed at 4.41%, logging a 72-bp decline MoM but a rise of 35 bps versus year-ago levels (see Figure 2).
In line with seasonal trends, KBRA’s prime and non-prime recovery rates increased 4.7 percentage points (ppt) and 7.9 ppts MoM, respectively, to 57.9% and 54.5% (see Figure 9 and Figure 10). We note the March increase in used vehicle prices,1 as measured…