Tuesday, March 2, 2010

Partial IOs - DB Style

I want to be very clear - I do not, have not, and never will work at Deutsche Bank in the foreseeable future. However, they issued a report today on Partial IOs, just a few hours behind my earlier post. Although their imagery is simply not as pretty as mine, they did have some interesting numbers.

Delinquencies are substantially higher on post-reset Partial IOs

, which is not unexpected, but still nice to see in a graph.

They also point out a few other facts, some of which may be obvious, but nonetheless:
  • Virtually all Partial IOs remaining are 2005 - 2008 vintage loans.
  • About 25-30bln partial IOs per year over the next 3 years. $80 bln total
  • 2012 will likely be the hardest - virtually all of these are 5-year partial IOs from 2007 - yuck.
  • Average increase - 21% (to my, roughly 20%)
  • They counted 350 loans worth $5.3 billion that will reset with a <1x>
  • $1.7 billion this year, $1.5 billion in 2011, and $2 billion in 2012
Their numbers agree with mine, its always nice to see your numbers actually match someone else that you respect. BUT, wow, their graphics guy needs a dose of caffeine. Their charts hurt my eyes.

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