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Fitch Report: Prime U.S. Auto ABS Losses in December 2007 Surged 60% on a Year-Over-Year Basis
NEW YORK-(Business Wire)-January 31, 2008 - Prime annualized net losses (ANL) on U.S. auto-loan asset-backed securities (ABS) rose to 1.34% in December 2007, a 15.5% jump over November and surging 60% higher on a year-over-year basis versus December 2006, as reported in the Fitch Ratings quarterly auto ABS newsletter 'In the Auto ABS Driver's Seat', published earlier today. The ANL rate has more than double through the end of 2007 compared with the rate of 0.66% recorded just six months earlier in June 2007. While increasing in absolute and percentage term, prime ANL performance through the end of 2007 remained within range of the levels experienced in 2003-2005.
Fitch's prime 60+ day delinquency index rose to 0.69% in December 2007, 6.2% above November but 30% higher versus December 2006, and well above levels produced in 2003-2005. Prime cumulative net losses (CNL) were 0.68% in December 2007 rising 4.6% over November, and 8% higher on a yearly basis.
Subprime auto ABS continued to display weaker performance in December 2007. 60+ days delinquencies hit 3.66% in December, 4% higher than in November and rising 35% on a year-over-year basis. Subprime ANL hit 7.56% in December 2007, 3% up over November. On a yearly basis, ANL were 14.5% higher in December 2007 versus the same period in 2006.
In coming months, Fitch doesn't expect to see much relief in sight for auto ABS performance in both the prime and subprime sectors. Current conditions in the economy along with a softer wholesale market will further pressure performance, despite this time of the year usually being a seasonally stronger period.
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