Ir­ish prime RMBS 90+ day delin­quen­cies im­proved

Financial Mirror (Cyprus) - - FRONT PAGE -

The Ir­ish prime res­i­den­tial mort­gage-backed se­cu­ri­ties (RMBS) mar­ket con­tin­ued to im­prove in the three-month pe­riod ended Jan­uary, ac­cord­ing to the lat­est in­dices pub­lished by Moody’s In­vestors Ser­vice.

The 30+ day delin­quen­cies de­creased to 16.96% of the out­stand­ing bal­ance in Jan­uary, from 17.21% in Oc­to­ber 2015. the 90+ day delin­quen­cies de­creased to 14.86% in Jan­uary from 15.05% in Oc­to­ber and the 360+ day delin­quen­cies (used as a proxy for de­faults) de­creased to 10.87% from 10.97% over the same pe­riod.

Out­stand­ing re­pos­ses­sions in­creased slightly to 0.40% from 0.38%, and cu­mu­la­tive losses rose to 0.21% in Jan­uary from 0.18% in Oc­to­ber. As of Jan­uary, 15 Moody’srated Ir­ish Prime RMBS trans­ac­tions had an out­stand­ing pool bal­ance of EUR 29.60 bln com­pared with EUR 33.08 bln in Jan­uary 2015, a year-on-year de­crease of 10.50%.

Low in­ter­est rates and de­clin­ing un­em­ploy­ment have sup­ported trans­ac­tions’ per­for­mance. Lenders’ for­bear­ance mea­sures also con­trib­uted to low­er­ing ar­rears, which will stay high. The rise in house prices could be an in­di­ca­tion of over-heat­ing, but the likely ex­pla­na­tion for the in­crease is a quicker re­cov­ery fol­low­ing the mar­ket’s dra­matic fall in 2008-12 rel­a­tive to other Euro­pean coun­tries.

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