Repossessions in sub-prime RMBS lowest since 2005

Repossessions in UK sub-prime residential mortgage-backed securities declined to 1.48% of the out-standing balance in February 2010, a level last recorded in August 2005, according to Moody’s Investors Service.

Arrears in the month also fell to 19.2% from a peak of 21% in June 2009. Most series recorded falling arrears but those in transactions issued by Preferred and Money Partners rose.

The redemption rate continued to fall. It was 9.4% this February, less than half the figure recorded in the same month in 2009 and a third of that seen in February 2008.

Moody’s outlook for the sub-prime RMBS market remains nega-tive. A total of 127 UK sub-prime RMBS transactions have been launched and rated by Moody’s since 2001.

As of February, a total balance of £25.5bn was outstanding in this market compared with £29.5bn in February 2009, and no new transactions have been issued since January 2009 .