Arrears on loans underlying Australian prime residential mortgage-backed securities dropped slightly in August.
According to Standard & Poor’s latest arrears report, loans that are greater than 30 days in arrears fell to 1.40 per cent from 1.46 per cent in July.
"In our opinion, whether this improvement will continue for the rest of the year will depend on the future movement of mortgage rates," Standard & Poor's credit analyst Vera Chaplin said.
But while the news was good for prime arrears, subprime RMBS arrears increased, by six basis points to 12.14 per cent.
“Because there has been no new issuance of subprime RMBS since December 2008, total subprime RMBS outstanding in August has fallen to below $2.4 billion, the lowest level since May 2004,” Ms Chaplin said.
“As the outstanding balances of loans underlying subprime and nonconforming RMBS amortize, we expect higher volatility in the arrears percentages reported.”
The financial services ombudsman has changed its rules after the ...
One in two borrowers does not believe banks always have their bes...
Here’s the weekly round-up of the biggest news stories from acr...