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SBA Hot Topic Tuesday — CPR Report: Actual 7(a) Prepays Go Above 17%

July 10, 2018

CPR Report: Actual 7(a) Prepays Go Above 17%

By Bob Judge
Editor, CPR Report

In June, total prepays, including paid excess principal (ACPR), came in at 17.59%, a 20% increase from last month’s reading of 14.69%.

After correcting for the excess principal being released from the MRF, pool prepays (CCPR) came in at 15.35%, up 21% from the previous reading of 12.72%.

Underlying loan level CPRs (LCPR) came in at 17.00%, also up 21% from the prior level of 14.11%.

As for the largest sector in the market, 20+ years to maturity, the ACPR came in at 17.77%, an increase of 18% from the previous reading of 15.05%. The CCPR came in at 15.54% versus 13.31% and the LCPR recorded 17.23%, up from 14.78%, previously.

The CDR calculations came out as follows:

Including excess (ACDR) was 2.79%, pool corrected (CCDR) was 2.44% and the loan-level (LCDR) was 2.70%.

As for the CRR, they came is as follows:

ACRR: 14.80%, CCRR: 12.91%, LCRR: 14.30%.

Regarding our maturity buckets, we saw 6 out of 7 buckets increase.

By order of magnitude, increases were seen in the actual data in 16-20 (+43% to ACPR 17.76%), 8-10 (+30% to ACPR 19.12%), 10-13 (+23% to ACPR 16.67%), 20+ (+18% to ACPR 17.77%), <8 (+15% to ACPR 25.67%) and 13-16 (+8% to ACPR 24.74%).

The lone decrease was seen in Fixed Rates, falling by 21% to ACPR 10.80%.

As for the CCPR, we also saw 6 buckets increase, with the largest one being 16-20 (+46% to CCPR 15.54%), 8-10 (+35% to CCPR 16.78%), 10-13 (+30% to CCPR 14.46%), <8 (+29% to CCPR 22.04%), 20+ (+17% to CCPR 15.54%) and 13-16 (+6% to CCPR 21.74%).

The lone decrease was also seen in Fixed Rates, falling by 21% to CCPR 10.37%.

Lastly, for the LCPR, we also witnessed 6 increases, led by 16-20 (+46% to LCPR 18.27%), 8-10 (+34% to LCPR 18.55%), 10-13 (+30% to LCPR 15.91%), <8 (+29% to LCPR 24.63%), 20+ (+17% to LCPR 17.23%) and 13- 16 (+5% to LCPR 23.32%).

The lone decrease was also seen in Fixed Rates, falling by 21% to LCPR 11.00%.

This month represents a significant move upwards in prepayment speeds led by voluntary payoffs and preliminary data suggests next month should be similar.

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