SBA Prepay Commentary

December 2020 SBA Prepayment Speeds



After a fall season of counter-trend prepayment increases, both pool types saw a slight dip in their December speeds. This decline may be due to a combination of typical seasonality for prepayments as well as November having fewer business days. We would expect for speeds to remain low next month due to their historical performance in winter months before they begin to pick up in the spring/summer as the growing availability of the COVID-19 vaccine should increase business confidence.

Equipment loan pools’ prepayments decreased from 12.7 to 11.9 CPR, with results mixed among vintages. Real-estate loan pools also slightly decreased, dropping from 11.5 to 11.0 CPR, their ninth decrease in the last twelve months.



Equipment Loan Pool CPRs


1Equipment loan pools have original WAMs between 8 and 13 years


Real-Estate Loan Pool CPRs


2Real-estate loan pools have original WAMs greater than 18 years


SBA Prepayment Tables (PDF)

Prepared according to methodologies described by SIFMA.



Other Helpful Links

Weekly Sector Update | Weekly, Monday

Market Today | Daily

Weekly Recap | Weekly, Friday

Brokered Deposit Rate Indications | Weekly, Monday

Vining Sparks Interest Rate Products Weekly Commentary | Weekly, Monday

Investment Alternatives Matrix | Weekly, Tuesday

MBS Prepay Commentary (December) | Monthly, 5th business day




Adam Hofer

Analyst, Investment Product Strategies

Vining Sparks

AHofer@viningsparks.com


Kevin A. Smith, CFA

SVP, Director Investment Product Strategies

Vining Sparks

KSmith@viningsparks.com


INTENDED FOR INSTITUTIONAL INVESTORS ONLY.
The information included herein has been obtained from sources deemed reliable, but it is not in any way guaranteed, and it, together with any opinions expressed, is subject to change at any time. Any and all details offered in this publication are preliminary and are therefore subject to change at any time. This has been prepared for general information purposes only and does not consider the specific investment objectives, financial situation and particular needs of any individual or institution. This information is, by its very nature, incomplete and specifically lacks information critical to making final investment decisions. Investors should seek financial advice as to the appropriateness of investing in any securities or investment strategies mentioned or recommended. The accuracy of the financial projections is dependent on the occurrence of future events which cannot be assured; therefore, the actual results achieved during the projection period may vary from the projections. The firm may have positions, long or short, in any or all securities mentioned. Member FINRA/SIPC.
Copyright © 2021
Member FINRA/SIPC
This is a publication of Vining-Sparks IBG, L.P.
775 Ridge Lake Blvd., Memphis, TN 38120