Investors see opportunities in subprime auto bonds

Jennifer Kang

May 12, 2020 09:00 PM

Car 575 375 — (200509) -- SOUTHAMPTON, May 9, 2020 (Xinhua) -- Photo taken on May 8, 2020 shows new vehicles for sale stored at Southampton Dock in Southampton, Britain. New car registration in Britain plunged by 97.3 percent in April, hitting a record low in decades as the nation was in lockdown for the entire month to tackle the novel coronavirus, according to a report released Tuesday. With showrooms closed and car buyers housebound, just 4,321 new cars were registered in the month, merely above the 4,044 units sold in February 1946, said the Society of Motor Manufacturers and Traders (SMMT) in the report. (Photo by Tim Ireland/Xinhua) | unreguser/Xinhua News Agency/PA Images

The market is split on its outlook for subprime auto ABS, but while conservative investors are staying away there is growing optimism among others who believe credit enhancements and prospects for a strong economic recovery make the asset class an attractive buy in the time of coronavirus.

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Topics

Coronavirus Health and Biotech ABS Securitization United States Americas North America SRI

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Jennifer Kang