SBA Update

November 6, 2017

Activity in the SBA sector was limited last week, as portfolio managers reviewed current holdings of SBA floating–rate pools.  In October, the SBA announced a change to the Secondary Market Program relative to the timing of the pass through of amortization excess. Going forward SBA floating-rate prepayment speeds should increase, however not all pools will be impacted equally.  Fixed-rate SBA paper continues to trade well with investors looking to seasoned DCPCs ahead of the November auction later this week.  In addition, depositories are looking to the whole loan market, adding USDA government guaranteed loans for fixed-rate exposure.


Floating-Rate 7(a) Pools


Fixed-Rate (DCPC and SBIC) Pools



Government Guaranteed Loan Trading


Portfolio managers have been focused on reviewing their SBA floating-rate holdings and adding fixed-rate government guaranteed exposure to their existing portfolios.  This week will be the November DCPC auction, which will include 10-year and 20-year maturities.


Greg Roll, CFA

Senior Vice President

Vining Sparks

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