September remittance reports showed a month-over-month (MoM) improvement in delinquency rates but weaker annualized net loss metrics in both our prime and non-prime indices (see Figure 1 and Figure 2). Early-stage delinquency rates in KBRA’s Prime Auto Loan ABS Index (30-59 day) fell 7 basis points (bps) MoM while late-stage (60+ day) delinquency rates remained flat to the August reading. Delinquency metrics in KBRA’s Non-Prime Auto Loan ABS Index moved in concert, albeit to a larger degree, with early-stage and late-stage delinquencies improving 53 bps and 12 bps MoM, respectively. Year-over-year (YoY) delinquency comparisons were less favorable, climbing in both indices versus the same time last year.
Annualized net losses have continued their typical seasonal MoM ascent that usually peaks in Q1 but are elevated versus year-ago levels. Meanwhile, recovery rates fell 93 bps MoM and 647 bps YoY in our prime index to 52.03%, while the non-prime recovery rate increased 83 bps MoM but…