Frontline Perspectives: U.S. Commercial ABS Outlook

Presented by

Stephanie Mah, Sergey Moiseenko, Mark Hirshorn and Hylton Heard

About this talk

This year, we face a challenging and uncertain economic backdrop. In the spring of 2022, the U.S. had its first quarterly decline in real GDP following six consecutive quarters of growth. The Federal Reserve reversed course and pulled back from its accommodative monetary policy with successive interest rate increases beginning in March 2022. While consumers displayed resiliency throughout the pandemic, much of that strength was heavily supported by federal stimulus measures, which have since expired. Nonetheless, DBRS Morningstar has a stable credit rating outlook on the agricultural finance, auto fleet lease, aviation, cell tower, equipment lease, film/broadcasting royalty, litigation finance, marine container, commercial PACE, rental car, small business, structured settlement, venture debt, and whole business ABS. DBRS Morningstar recognizes multiple challenges facing commercial ABS in 2023 including inflationary pressures, with certain sectors likely to be more vulnerable to the recessionary environment, including aviation, transportation, housing, and retail-oriented industries. Other sectors such as agricultural finance, litigation finance, structured settlements, and venture debt, are more countercyclical and are expected to be less affected by broader macroeconomic conditions. Join DBRS Morningstar on February 8 at 2:00 p.m. EST for a Frontline Perspectives webinar moderated by Stephanie Mah, Senior Vice President, Structured Finance Research. We will focus on the U.S. commercial ABS outlook for 2023, with shared perspectives from senior analysts Hylton Heard, Mark Hirshorn, and Sergey Moiseenko. We will present an overview of major factors affecting the ABS market as well as specifics across commercial ABS sectors including aviation, auto fleet lease, commercial PACE, equipment leases, marine container, and small business ABS. The discussion will be followed by a Q&A session for the audience to participate in the conversation.
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Morningstar DBRS is a leading provider of independent rating services and opinions for corporate and sovereign entities, financial institutions, and structured finance instruments globally. Rating more than 4,000 issuers and 60,000 securities, we are the fourth-largest credit rating agency in the world and a market leader in Canada, the U.S. and Europe in multiple asset classes.