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报告摘要

ABS Spotlight Summary - May 2018

Core Content

The May 2018 issue of ABS Spotlight provides an in-depth analysis of various asset-backed securities (ABS) sectors in the US and Canada, highlighting credit implications, market trends, and regulatory changes. The report focuses on auto loans, credit cards, consumer loans, commercial and esoteric ABS, and the impact of policy changes on credit risk.

Main Points

Auto Loan ABS - US: Risk Layering and Credit Risks

Risk layering is more prevalent in longer-term auto loans, contributing to higher credit risks.
Longer-term loans have weaker credit characteristics, including lower weighted average credit scores and higher loan-to-value (LTV) ratios.
Historical losses for longer-term auto loans (2003–2015) are 2–5 times higher than those for shorter-term loans.
Loan terms have been increasing, with the weighted average original term of prime auto ABS loans rising to 65 months in Q1 2018 from 62 months in 2010.
Auto lenders consider risk layering when setting loan pricing, often charging 100 basis points more in APR for longer-term loans.
Competition can compress APR, reducing credit protection and increasing net losses in downturns.

Auto ABS - US: Sector Update – Q1 2018

Used vehicle prices normalized in Q1 2018 after a spike in Q4 2017, driven by hurricane-related demand.
Auto lease ABS residual values showed gains in Q1 2018.
Floorplan ABS monthly payment rates remained mostly flat year-over-year.
Prime auto ABS pools continue to reflect longer original terms, even for captive issuers.
FICO scores for prime auto loan pools have marginally improved, but original terms have continued to rise.

Pulse of Consumer Credit: Slowdown in Growth of Household Debt is Credit Positive

Household debt growth slowed to 3.8% in Q1 2018, below the 2017 rate and the 2018 GDP forecast, indicating a credit positive trend.
Credit card delinquencies rose slightly, but auto loan delinquencies declined.
Auto loan growth slowed to the lowest annual pace since Q3 2012, with delinquencies expected to remain stable.
Residential mortgages saw modest growth and a slight decline in delinquencies, but are expected to increase as underwriting standards loosen.
Moody's warns that lenders may become complacent and fail to tighten underwriting standards before the next downturn.

Underwriting Standards for Credit Cards and Auto Loans Tighten Modestly

The Senior Loan Officer Opinion Survey (SLOOS) indicates a modest tightening of underwriting standards for credit cards and auto loans in Q1 2018.
This is a mild credit positive, but Moody's expresses concern about lenders' complacency and potential for future credit risk.
Residential mortgages underwriting standards remained largely unchanged.

Credit Card ABS – Canada: Performance Remained Steady in March

Canadian credit card performance remained stable in March 2018.
The net charge-off rate increased slightly to 3.27%, while the total delinquency rate decreased to 2.37%.
Payment rates improved significantly, rising to 42.15% from 38.10% in February.
Yield and excess spread declined in March, but remained relatively stable compared to previous years.
The performance data tracked CAD36.5 billion in credit card receivables.

Proposed T-Mobile/Sprint Merger

The proposed merger is credit positive for Sprint's spectrum ABS but credit negative for the wireless tower ABS sector.
The merger would likely improve the credit quality of Sprint's spectrum lease due to additional guarantees from T-Mobile.
However, the merger may lead to lower recovery on lease obligations if the lease is rejected or in liquidation.
Wireless tower ABS would face reduced demand for tower space and higher lessee concentration risk due to the merger.
Despite these challenges, the wireless tower industry is expected to benefit from increased data usage and 5G technology adoption.

California's Proposed Building Standards

The proposed solar standards in California are credit negative for utilities but credit positive for solar ABS.
These standards would require solar photovoltaic systems on new residential buildings starting in 2020.
The shift to solar-powered homes could increase costs for non-solar customers and reduce revenue for utilities.
Solar developers are likely to benefit from increased installations, improving creditworthiness for solar ABS transactions.

China Tariff Proposal

The China tariff proposal targeting $50 billion in US exports has mixed credit implications.
Agriculture and soybeans face the largest negative impact, with China accounting for half of US agricultural exports.
Aerospace, chemicals, and plastics may also see moderate negative effects, but companies with multinational operations can mitigate these.
Boeing and Ford are expected to have limited impact due to local production in China.
Tesla is most vulnerable, with 20% of its revenue coming from China exports.

Companies Invest in Marijuana

Marijuana legalization presents both challenges and opportunities for US companies in alcoholic beverages, tobacco, consumer products, and pharmaceuticals.
Constellation Brands invested in Canopy Growth, a Canadian cannabis company, to explore the market.
Tobacco companies like Altria and Vector Group are prepared for federal legalization, which could benefit from their distribution systems and sales expertise.
Pharmaceutical companies may face pressure on certain products, but CBD-based products offer long-term opportunities.

Key Information

Risk layering in longer-term auto loans increases credit risk.
Household debt growth slowed in Q1 2018, which is credit positive.
Underwriting standards for credit cards and auto loans have modestly tightened, but lenders may still be complacent.
The T-Mobile/Sprint merger is positive for Sprint's spectrum ABS but negative for wireless tower ABS.
California's solar standards are positive for solar ABS but negative for utilities.
The China tariff proposal has mixed credit effects, particularly harming agriculture and chemicals.
Marijuana legalization presents both risks and opportunities for various sectors.