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Coronavirus lockdown will hit asset-backed securities' performance: Moody's

Auto loan delinquencies to rise in the coming months

Moody’s
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Abhijit Lele Mumbai
Rating agency Moody's Investors Service says the nationwide lockdown in India will adversely impact the performance of the commercial vehicle and small and medium-sized enterprise (SME) loans in asset-backed securities (ABS).

Asset-backed securities are a kind of instrument where the underlying loan pool and income stream are packaged and often rated for strength. Most assets in rated Indian ABS are commercial vehicle and SME loans.

With the three-week lockdown till April 14, the activity in the transport sector and businesses has almost come to a halt, reducing income and repayment abilities.

The lockdown will also hamper physical loan collections, with

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First Published: Mar 30 2020 | 11:43 AM IST

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