‘Collection ratios in securitised pools see dip’

Ratings agency Crisil Ratings on Wednesday said collection ratios in securitised pools had seen a dip during the second wave of the COVID-19 pandemic.

The agency said unlike in the first wave, the decline in the second wave had not been as sharp for two reasons — localised restrictions limited the impact on business activity, and lack of moratorium meant that borrowers could not postpone their debt repayments.

Securitisation is the process of pooling and repackaging of homogenous illiquid financial assets into marketable securities that can be sold to investors.

Crisil said in a report that while commercial vehicle loans saw a dip in median collection ratios of almost 11 percentage points in May, it expected collections to improve in line with the recovery expected in economic activity.

Median collection ratios for pools comprising micro, small and medium enterprises and microfinance fell 12 percentage points and 6 percentage points, respectively, the agency said.


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