The overall performance of the auto loan and lease asset-backed securities (ABS) market in EMEA remained stable during the three-month period ended April 2014, according to the latest indices published by Moody's Investors Service.
EMEA auto loan and lease ABS 60+ day delinquencies slightly decreased to 0.69% in April 2014 from 0.75% in April 2013 and remained at the same level as in January 2014. This result can partially be attributed to markets that have been performing well, such as Germany where delinquencies remained stable at 0.5% and the Netherlands where they stayed at about 0.1% over the last year, as well as markets such as Spain, where delinquencies slightly decreased to 2.48% in April 2014 from 2.67% in April 2013. Another positive effect contributing to the decrease in delinquencies is the fact, that most transactions in Portugal were repaid until April 2014, so with only one Portuguese transaction outstanding the share of worse performing deals in the market also decreased. Also, Spain remains a weak market as its level of delinquencies and defaults remain much higher than the index average.
Moody's outlook for German auto ABS collateral is stable. The rating agency expects that the unemployment rate in Germany will remain stable at 5.1%, while GDP will increase by 1.5% in 2014. Moreover, Moody's expects that Spanish GDP will increase to 1.2% in 2014 and that the unemployment rate will slightly decline to 25.6%, as Moody's previously announced its forecast in Moody's Statistical Handbook - Country Credit, May 2014.
In the first quarter of 2014, Moody's rated six new auto ABS transactions, five in Germany and one in the UK. The current pool balance of all outstanding rated Auto ABS transactions was EUR30.8 billion in April 2014.