KBRA’s headline equipment loan and lease index posted an improvement in annualized net losses in October. The 27-basis point (bp) month-over-month (MoM) improvement in headline loss performance was driven by lower losses in KBRA’s Large Ticket Sub-Index, which fell 54 bps MoM, but this was partially offset by higher losses in KBRA’s Small-Medium Ticket Sub-Index, which increased 19 bps during the month. Loss performance, while remaining at low absolute levels, has been somewhat volatile over the past 12 months, but October’s headline rate was down 7 bps versus year-ago levels.
Meanwhile, the headline 60+ day delinquency rate was essentially flat, rising by just 1 bp MoM, as the 3-bp MoM increase in the large ticket delinquency rate was offset by a 3-bp MoM decline in the small-medium ticket delinquency rate. On a year-over-year (YoY) basis, delinquencies have climbed 34 bps, driven by a deterioration in both small-medium and large ticket performance.
Recovery rates in the small-medium…