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ISCOVER
Staff Reporter
Loans underlying Australian prime residential mortgage-backed securities (RMBS) that are greater than 30 days in arrears fell 6 basis points to 1.56 per cent in May 2012, new research has revealed.
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According to a recent report by Standard & Poor's Ratings Services, subprime RMBS arrears fell by 116 bps to 10.71 per cent in May.
New arrears (less-than-30-days bucket) declined by 11 bps, and severe arrears (greater-than-60-but-less-than-90-days bucket, and greater-than-90-days bucket) fell by 105 bps during the month.
Standard & Poor's credit analyst Narelle Coneybeare said the results were positive as this is only the second time since mid-2007 in which there has been an increase in the “total amount of cross-border RMBS outstanding".
"We believe there may be some further easing in arrears going forward as the impact of interest rate cuts in May and June begin to feed through to borrowers,” Ms Coneybeare said.
Standard & Poor's Mortgage Performance Index (SPIN) measures the weighted-average arrears more than 30 days past due on residential mortgage loans in both publicly and privately rated Australian RMBS transactions.
