SBA Prepay Commentary

March 2022 SBA Prepayment Speeds

Inflation continues to be a growing worry for small business owners, as 26% of respondents to the NFIB Small Business Economic Trends survey listed it as the single biggest problem they’re currently facing, the highest percentage in over 30 years. A net 46% of small business owners responded that they plan on raising selling prices while 68% of respondents reported doing so over the last month. These worries, along with the still-elevated concerns over cost and quality of labor (11% and 22%, respectively), an economy recovering from the pandemic, and worldwide impacts due to the ongoing conflict in Ukraine, could put downward pressure on prepayments in the coming months.

Speeds on both equipment and real-estate loan pools decreased in February. Equipment loan pools’ prepayments slowed from 21.5 to 18.3 CPR, with most individual vintages experiencing decreases. Speeds on real-estate loan pools declined from 18.4 to 14.7 CPR, which was also the case for most pools when viewed on a vintage-by-vintage basis.

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

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Vining Sparks Interest Rate Products Weekly Commentary | Weekly, Monday

Investment Alternatives Matrix | Weekly, Tuesday

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

NFIB Small Business Economic Trends (February) | Monthly, 2nd Tuesday of each month

Adam Hofer

Analyst, Investment Product Strategies

Vining Sparks

Kevin A. Smith, CFA

SVP, Director Investment Product Strategies

Vining Sparks

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