NEW YORK--(BUSINESS WIRE)--Fitch Ratings expects credit card ABS ratings to maintain the stability that has been the hallmark of the asset class over the past two decades through multiple downturns, including the most recent severe crisis. Credit card ABS structures are expected to remain well enhanced and are capable of withstanding considerable performance stresses.
Fitch believes delinquencies and chargeoffs, as measured by Fitch indices, have touched their troughs after reaching historical lows throughout 2013. Monthly payment rates (MPRs) increased substantially year over year, setting record highs along the way, reflective of the high credit-quality borrowers in the securitized pools. Excess spread, meanwhile, is expected to remain at or near historical highs given the low interest rate and chargeoff environment. Although the number of securitized receivables has been declining, collateral quality remains solid with high FICO score accounts and low utilization rates prevailing.
Fitch's special report '2014 Outlook: Credit Card Asset-Backed Securities' is available at 'www.fitchratings.com'.
Additional information is available at 'www.fitchratings.com'.
Applicable Criteria and Related Research:
--'Global Credit Card ABS Rating Criteria' (June 2013);
--'Global Structured Finance Rating Criteria' (May 2013).
Applicable Criteria and Related Research: 2014 Outlook: Credit Card Asset-Backed Securities (Delinquency and Loss Metrics Approach Troughs)
Global Credit Card ABS Rating Criteria
Global Structured Finance Rating Criteria