CHICAGO, IL (September 11, 2012) — Consistent with seasonal trends, U.S. timeshare ABS delinquencies dropped in the second quarter, according to the latest timeshare index results from Fitch Ratings.
Total delinquencies for second-quarter 2012 (2Q’12) were 3.29%, down from 3.58% in 1Q’12. Additionally, year-over-year total delinquencies remain consistent with the 2Q’11 level of 3.28%. Delinquencies have normalized at their historical levels following the dramatic increases that occurred in 2008 and 2009.
2Q’12 defaults rose slightly to 0.81% from 0.82% in 1Q’12, also reflecting a seasonally consistent pattern. Timeshare default trends typically lag those of delinquencies. Defaults have also remained relatively consistent year-over-year, increasing nominally from 0.80% during the same period last year.
Fitch’s Rating Outlook for timeshare ABS remains Stable due in part to the delevering structures found in timeshare transactions and ample credit enhancement levels.
Fitch’s timeshare ABS index is an aggregation of performance statistics on pools of securitized timeshare loans originated by various developers. Expected cumulative gross defaults on underlying transactions can range from 10% to above 20%. While delinquencies and defaults may vary on an absolute basis, most transactions supporting the index exhibit similar overall trends.
The Fitch timeshare performance index summarizes average monthly delinquency (over 30 days) and gross default trends tracked in Fitch’s database of timeshare asset backed securities (ABS) dating back to January 1997 and is available on a quarterly basis.
Fitch’s quarterly index can be found at ‘ www.fitchratings.com ‘ under the following headers:
Sectors then Structured Finance then ABS then ABS Indices then Timeshare
Additional information is available at ‘ www.fitchratings.com ‘.
SOURCE: Fitch Ratings