SBA Prepay Commentary

November 2021 SBA Prepayment Speeds



Prepayment speeds on both equipment and real-estate loan pools increased for the seventh time in eight months. These are the fastest speeds seen since March 2020 and both pool types are nearing their respective pre-pandemic levels. Availability and quality of labor remains a high concern among small business owners, as reported by the NFIB, though it may be waning. 49% of business owners saying they have job openings they are unable to fill, which is two percentage points lower than the previous month. For the month of October, 44% of small business owners reported that they increased employee compensation, topping the prior month’s 48-year record high. Concerns over inflation are also growing, as 16% of respondents listed it as the single most important problem facing their business in October, up from 10% the month prior. This coincides with the FOMC’s Summary of Economic Projections reflecting similar expectations in their September 22nd release.



Equipment loan pools’ prepayments increased from 13.5 to 15.4 CPR, with almost all vintages increasing as well. Prepayments on real-estate loan pools also sped up, going from 15.0 to 17.1 CPR, though results were more mixed 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

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 (November) | Monthly, 5th business day

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




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


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