“Investors and originators are again seeing securitisation
as a viable funding tool given the healthy collections seen across most asset classes post the end of the moratorium period in August 2020 provided under Reserve Bank of India’s Covid-19 Regulatory Package”, the rating agency said.
“Most investors nonetheless are maintaining stringent filters during pool selection, but there is a considerable increase in appetite for purchase of such retail pools, mainly in the secured asset class, which will augur well for the market”, it added.
The rating agency has estimated annual securitisation volume in the range of Rs 80,000–90,000 crore in FY21.
Among the asset class, it is mostly the secured assets that have dominated the securitisation volumes this fiscal year. Mortgage backed securities, which saw relatively lower disruption to the pandemic, therefore, resulting in lower delinquencies, has further strengthened its position in the total securitized volume from 33 per cent in H1FY21 to 42 per cent in Q3FY21. On the other hand, gold loans formed 15 per cent of the volume in Q3.
“Due to the uncertainty in the environment caused by the pandemic, we have seen investors increase their focus to the secured asset class where the losses would be restricted due to the presence of adequate collaterals”, said the rating agency.
While secured asset classes saw good traction, the unsecured asset classes such as microfinance loans have seen their share in the securitisation market fall to 5-6 per cent in Q3FY21 compared to 15-20 per cent in the year ago period.
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