KBRA Releases Research – The Geography of Auto Loan ABS Performance

NEW YORK--(BUSINESS WIRE)--KBRA releases research examining state-level auto loan ABS performance across the U.S. Most auto ABS transactions are geographically diversified, limiting the impact of any single state on overall deal performance. However, geographic differences may be more relevant for whole-loan buyers and for securitizations with outsized concentrations in states performing meaningfully above or below expectations, particularly when those concentrations differ from a shelf’s historical geographic footprint.

Key Takeaways

• The Southeast reported the greatest credit stress, accounting for four of the five highest 60+ day delinquency rates during 1H 2026: Mississippi (4.57%), South Carolina (4.54%), Georgia (4.46%), and Louisiana (4.17%). New Mexico (4.40%) was also among the five weakest states. Vermont (1.50%), Minnesota (1.58%), Maine (1.86%), Nebraska (1.94%), and Connecticut (1.98%) reported the lowest rates.
• Borrower credit quality and shelf composition explain only part of the geographic dispersion. After adjusting for credit score and shelf mix, Louisiana performed 77 basis points (bps) worse than expected, followed by Georgia (+60 bps), Mississippi (+51 bps), South Carolina (+37 bps), and Alabama (+32 bps). By contrast, New Mexico, despite having one of the highest raw delinquency rates, performed 42 bps better than expected.
• State-level performance differences have been persistent over time. Several states, including Mississippi, Louisiana, Georgia, and South Carolina, have repeatedly ranked toward the weaker end of the distribution, while states such as Minnesota, Vermont, Maine, and Nebraska have consistently performed better.

Click here to view the report.

About KBRA

KBRA, one of the major credit rating agencies, is registered in the U.S., EU, and the UK. KBRA is recognized as a Qualified Rating Agency in Taiwan, and is also a Designated Rating Organization for structured finance ratings in Canada. As a full-service credit rating agency, investors can use KBRA ratings for regulatory capital purposes in multiple jurisdictions.

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