RPT-Fitch: EMEA SF Losses Flat on Previous Year

Tue May 27, 2014 9:06am EDT

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May 27 (Reuters) - (The following statement was released by the rating agency)

Loss expectations on pre-crisis EMEA securitisations have remained constant, according to Fitch Ratings in a new report.

Total losses on bonds issued between 2000 and 2008 have been flat at 1% for three consecutive years. This includes realised losses of 0.3% (unchanged from the previous year) and expected future losses of 0.7%.

"Total losses of 1% on pre-crisis EMEA securitisations compare favourably with 7.6% on US transactions from the same vintages," said Gioia Dominedo, Senior Director in Fitch's Structured Finance team. The strongest performance is visible in consumer assets such as mortgages, credit cards and auto loans, with total losses of 0.3% on EMEA RMBS and 0.1% on EMEA consumer ABS from the same vintages.

"No losses are expected on UK and Dutch prime RMBS, which account for over a third of the bond balance issued pre-crisis," said Dominedo. EMEA RMBS losses are mainly accounted for by Spanish and UK nonconforming deals. However, total losses in these sectors remain below 2%. Similarly, EMEA ABS losses are concentrated in underperforming Spanish transactions.

Fitch expects total losses of 4.1% of the global bond balance issued between 2000 and 2013. A closer look reveals an encouraging sign for post-crisis transactions. Issued after 2008, these deals thus far account for only 0.1% of loss estimates.

'Global Structured Finance Losses: 2000-2013 Issuance' and the related data file are available at www.fitchratings.com or by clicking on the above link.

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