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S&P’s latest Performance Index showed that 1.11 per cent of prime RMBS were in arrears as of 29 February, up from 1.07 per cent on the prior month.
The index measures the weighted average arrears more than 30 days past due on residential mortgage loans in publicly and privately rated Australian RMBS transactions.
Full-doc and low-doc arrears increased to 1.07 per cent and 4.55 per cent respectively, while the proportion of non-conforming RMBS in arrears rose to 5.22 per cent from 4.91 per cent in January.
S&P noted that while the rise in loan arrears partly reflected a decline in outstanding loan balances, there was also a seasonal component at play.
“Arrears typically increase in January and February, reflecting the effects of Christmas spending, holidays and January sale periods,” it said.
The rise in mortgage delinquencies was consistent across originator types, with regional banks recording the highest arrears level in February of 2.15 per cent, up from 2.04 per cent on the previous month.
Non-bank lenders recorded the lowest arrears of all originator types at 0.76 per cent, up from 0.75 per cent in January.
“We expect arrears to modestly increase in the coming months, in keeping with seasonal patterns,” S&P concluded.
[Related: Resimac receives top ratings for prime RMBS]