Davis+Gilbert’s Insolvency, Creditors’ Rights + Financial Products Practice Group

Subprime Auto ABS Thriving, But Regulatory Uncertainty Looms

Retrieved on: 
Thursday, June 17, 2021

Subprime auto market participants are expecting some deterioration in 2021 as concerns shift from the economic uncertainty brought about by the pandemic, to regulatory uncertainty ushered in with the new presidential administration.

Key Points: 
  • Subprime auto market participants are expecting some deterioration in 2021 as concerns shift from the economic uncertainty brought about by the pandemic, to regulatory uncertainty ushered in with the new presidential administration.
  • Participants see potential regulatory enforcement or new regulations as potentially dampening enthusiasm for new originations and ABS issuances.
  • A majority of investors expect the pandemic to have a lasting negative effect on their participation in subprime auto securitizations.
  • The Subprime Auto Loan Risk Chronometer, which closely tracks market risks, is a key feature of the site.