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U.S. Auto Loan Tracker: Both Prime and Subprime Markets Show Effects Of COVID-19 For March 2020

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U.S. Auto Loan Tracker: Both Prime and Subprime Markets Show Effects Of COVID-19 For March 2020

NEW YORK (S&P Global Ratings) May 13, 2020-- S&P Global Ratings' published today the U.S. auto loan asset-backed securities (ABS) sector's performance for March 2020, the first month after the COVID-19 pandemic began, (see "U.S. Auto Loan ABS Tracker: March 2020 Performance," published May 12, 2020).

Highlights from the report include the following:

  • The COVID-19 pandemic is starting to take a toll on monthly auto loan ABS credit performance. March's subprime loss rate of 8.37% was the highest March loss rate since 2009 and the segment's recovery rate and 60+ day delinquency levels were at the worst March levels we've ever seen. Also, March's prime recovery rate of 53.89% was the lowest March recovery rate we've seen since 2009.
  • Another poignant indicator of potential consumer distress materialized with a spike in extension rates for March relative to February's levels. An extension is a deferral of an auto payment that is typically added to the end of the obligor's payment schedule.
  • On May 12, 2020, we placed 33 classes of nonIG subprime auto loan ABS securities on CreditWatch negative. These CreditWatch negative actions are in response to the higher losses we are expecting on the associated collateral pools due to COVID-19's economic impact on them.

This report does not constitute a rating action.

The report is available to subscribers of RatingsDirect at www.capitaliq.com. If you are not a RatingsDirect subscriber, you may purchase a copy of the report by calling (1) 212-438-7280 or sending an e-mail to research_request@spglobal.com. Ratings information can also be found on S&P Global Ratings' public website by using the Ratings search box located in the left column at www.standardandpoors.com. Members of the media may request a copy of this report by contacting the media representative provided.

Primary Credit Analyst:Amy S Martin, New York (1) 212-438-2538;
amy.martin@spglobal.com
Secondary Contacts:Timothy J Moran, CFA, FRM, New York (1) 212-438-2440;
timothy.moran@spglobal.com
Jennie P Lam, New York (1) 212-438-2524;
jennie.lam@spglobal.com
Kenneth D Martens, New York (1) 212-438-7327;
kenneth.martens@spglobal.com
Steve D Martinez, New York (1) 212-438-2881;
steve.martinez@spglobal.com
Research Contributor:Reema Kakkar, CRISIL Global Analytical Center, an S&P affiliate, Mumbai
Media Contact:Luke Shane, New York + 1 (212) 438 1244;
luke.shane@spglobal.com

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