Securitization collections improve to 79% in September: Ind-Ra
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India Ratings and Research (Ind-Ra) has said that the average collections across its rated securitization transactions have inched up to 79 percent in September 2021 from 70 percent in May 2021 as the economy started to open up due to acceleration in vaccine rollout. It noted that the performance of securitization transactions has witnessed a continued improvement with the increase in September collections and a drop in delinquencies percentage across asset classes.
According to the report, average collection in September 2021 witnessed a sharp improvement in tractor loan pools. The current collections from unsecured business loan transactions are still lagging as compared to the other asset classes. This is primarily because of the non-performance of small ticket-size loans. The pace of improvement in commercial vehicles loan pools is slow due to increased fuel cost, which continues to put pressure on the trucker's profit margins.
The agency witnessed a drop in delinquency percentages for its rated transactions across asset classes except in unsecured business loans. It said the sharp improvement is seen in all other pools with delinquencies back to pre-second wave levels. It added that the positive impact of the festive season is likely to be seen in October-November 2021 collections.
