Friday, September 5, 2008
Forget sub-prime, now prime mortgages begin to hit the buffers
Arrears on HBOS prime Residential Mortgage Backed Securities have rocketed as overall prime RMBS arrears rise by a third. According to Moody’s rating agency, delinquencies in prime RMBS rose to 0.9 per cent in the second quarter of 2008, up from 0.6 per cent in Q2 2007. It says this is the highest average delinquency rating since the current Master Trusts programmes were created. But it was Mound, Bank of Scotland's Master Trust, that is suffering worst of all the UK prime RMBS with arrears of 4.1 per cent. This was followed by Northern Rock’s Granite which has 1.3 per cent arrears and HBOS’ other RMBS Master Trust, Halifax's Permanent, which came in third with 1.2 per cent delinquencies as of Q2 2008.