KBRA Enhances Consumer Loan ABS Index for Better Insights
KBRA Consolidates U.S. Consumer Loan ABS Index
KBRA is excited to announce a significant enhancement to its U.S. Marketplace Consumer Loan ABS Index, set to take effect with its upcoming December report. This new framework will combine all credit performance data into a single index, aiming to provide a clearer picture for investors and stakeholders.
A Unified Approach
In the past, KBRA separated the credit performance of consumer loans into two distinct categories: Tier 1 and Tier 2. However, acknowledging the need for improved clarity and efficiency, KBRA is now taking a unified approach. This change brings all outstanding securitized marketplace consumer loan pools under one roof, making it easier for consumers and investors to navigate the market.
Benefits of Consolidation
This consolidation offers several benefits. Firstly, it simplifies performance tracking, thereby allowing investors to assess credit performance more efficiently. Secondly, it enhances the comparability of data, promoting better investment decision-making. Finally, this update, effective retroactively to March 2018, ensures that stakeholders have access to a comprehensive view of credit performance since the inception of these indices.
Implications for Investors
With this update, investors can expect a more streamlined experience when evaluating credit performance in the consumer loan sector. The unified index not only will provide more accurate data but will also help in understanding market trends and shifts in consumer credit health.
About KBRA
KBRA stands out as a major player among credit rating agencies and has established a solid reputation across various international markets, including the U.S., EU, and UK. Its recognition as a Qualified Rating Agency in Taiwan underlines its credibility, while its designation as a Rating Organization for structured finance in Canada speaks to its broad influence. Investors across multiple jurisdictions can confidently utilize KBRA ratings for regulatory capital purposes.
Frequently Asked Questions
What is the recent change in KBRA's index?
KBRA has unified its U.S. Marketplace Consumer Loan ABS Index to enhance clarity and performance metrics.
When will this change take effect?
The changes will be reflected in KBRA’s December 2024 report.
What was the previous structure of the index?
Previously, the index separated credit performance into Tier 1 and Tier 2 indices.
How does this consolidation benefit investors?
It simplifies tracking, improves comparability, and offers a more comprehensive view of credit performance.
What is KBRA's reputation in the industry?
KBRA is recognized as a major credit rating agency and a Qualified Rating Agency across several countries.
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