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

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

September 4, 2019
By Bob Judge
Editor, CPR Report

In June, total prepays, including paid excess principal (ACPR), came in at 17.45%, a 1% decrease from last month’s reading of 17.68%.

After correcting for the excess principal being released from the MRF, pool prepays (CCPR) came in at 15.96%, down 1% from the previous reading of 16.07%.

Underlying loan level CPRs (LCPR) came in at 17.28%, also down 1% from the prior level of 17.41%.

As for the largest sector in the market, 20+ years to maturity, the ACPR came in at 17.66%, a decrease of 1% from the previous reading of 17.91%. The CCPR came in at 16.52% versus 16.63% and the LCPR recorded 17.94%, down from 18.06%, previously.

The CDR calculations came out as follows:

Including excess (ACDR) was 2.76%, pool corrected (CCDR) was 2.53% and the loan-level (LCDR) was 2.74%.

As for the CRR, they came is as follows:

ACRR: 14.69%, CCRR: 13.43%, LCRR: 14.54%.

Regarding our maturity buckets, we saw 5 out of 7 buckets increase.

By order of magnitude, increases were seen in the actual data in Fixed (+68% to ACPR 24.99%), 8-10 (+48% to ACPR 17.30%), 13-16 (+21% to ACPR 16.35%), <8 (+10% to ACPR 19.35%) and 16-20 (+6% to ACPR 20.75%).

Decreases were seen in: 10-13 (-9% to ACPR 16.50%) and 20+ (-1% to ACPR 17.66%).

As for the CCPR, we also saw 5 buckets increase, with the largest one being: Fixed (+59% to CCPR 24.02%), 8-10 (+51% to CCPR 16.32%), 13-16 (+28% to CCPR 16.29%), <8 (+14% to CCPR 16.95%) and 16-20 (+6% to CCPR 14.58%).

Decreases included: 10-13 (-9% to CCPR 14.51%) and 20+ (-1% to CCPR 16.52%).

Lastly, for the LCPR, we also witnessed 5 increases, led by Fixed (+58% to LCPR 25.06%), 8-10 (+50% to LCPR 16.67%), 13-16 (+28% to LCPR 17.09%),<8 (+14% to LCPR 18.57%) and 16-20 (+6% to LCPR 17.13%).

Decreases by magnitude were seen in: 10-13 (-9% to LCPR 15.67%) and 20+ (-1% to LCPR 17.94%).

Prepays seem to be entrenched in the 17% range and expectations for lower rates haven’t shown any impact yet.