DBRS Releases April 2014 Canadian ABS and Enhanced ABS Reports

DBRS has today released the enhanced version of the Monthly Canadian ABS Report (the Enhanced ABS Report), in conjunction with the Monthly Canadian ABS Report.

The Enhanced ABS Report offers additional metrics, longer data series, definitions and charts that provide the user with both numeric and graphic presentations to allow for a quick review of the overall performance and trends for each transaction, as well as benchmarking of transactions within an asset class.

The Monthly Canadian ABS Report has links that allow the user to go from the table of contents or the individual transaction page to the corresponding Enhanced ABS Report for that particular issuance.

The total outstanding amount of the Canadian ABS market was $30.9 billion at the end of April 2014, up 2.3% from the previous month’s outstanding amount of $30.2 billion. This increase was driven by three new issuances in the month. Regular run-off amounted to $259.9 million.

In the month, CHIP Mortgage Trust came to market and issued $125.0 in Series 2014-1 Notes, Ford Auto Securitization Trust issued $644.3 million in Series 2014-R2 Notes, and Master Credit Card Trust II issued Series 2014-1 Notes that was placed privately. New issuance was partially offset by one repayment in the month: Master Credit Card Trust II Series 2013-1 Notes for $766.0 million.

On May 28, 2014, DBRS published an industry study titled “Retail Auto Securitization in Canada: Annual Update.” Canadian auto securitization transactions continued to perform well in 2013, thanks to stable employment, continuing low interest rates and strong used vehicle values. 2013 saw the highest recorded new car sales volume in Canada since 2002, with Canadian consumers purchasing 1,743,112 vehicles, up 4.0% from 1,675,675 vehicles in 2012. 2014 is faring well with year-to-date sales in April showing a 1.9% increase over the same period in 2013. However, debt-burdened Canadian consumers continue to seek lower monthly payments to keep affordability in check; as a result, long-term loans (60 months or longer) remain the order of the day.

Credit cards remain the largest asset class within the ABS market, comprising 77.0% of the market. Auto loans and leases increased to 8.0%, followed by home equity lines of credit, which remained flat at 5.0%. The ABS market composition continues to favour consumer lending and mortgage obligations, accounting for approximately 93.6% of the market.

Notes:
All figures are in Canadian dollars unless otherwise noted.

The full report providing additional analytical detail is available by clicking on the link under Related Research at the right of the screen or by contacting us at info@dbrs.com.