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RMBS arrears rise further

The proportion of Australian housing loans in arrears has increased for prime and non-conforming residential mortgage-backed securities (RMBS).

According to Standard & Poor’s (S&P) Performance Index (SPIN), arrears levels for prime RMBS rose to 0.98 per cent in December 2015 from 0.92 per cent in November, while non-conforming RMBS levels increased to 4.63 per cent from 4.22 per cent a month earlier.

Non-bank lenders recorded the lowest arrears level of all originator types at 0.70 per cent, while regional banks had the highest arrears level at 1.74 per cent.

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The major banks reported in December that arrears of more than 30 days increased by 27 per cent year-on-year, despite a rise in outstanding balances of over 50 per cent during the period.

Meanwhile, non-bank lenders reported a 23 per cent decline in arrears, despite a 3 per cent contradiction in outstanding balances.

S&P credit analyst Narelle Coneybeare said while most categories saw increases in loan arrears during December, prime and non-conforming arrears remained lower than 12 months earlier.

“We expect further increases in arrears in the coming quarter, typical of the post-Christmas months,” she said.

[Related: Investor curbs positive for RMBS, says Moody's]

RMBS arrears rise further
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