Kroll Bond Rating Agency (KBRA) has released its Equipment Loan & Lease indices for July 2021.

The equipment loan and lease securitization sector continued to display positive credit performance during the June collection period. KBRA’s headline Equipment Loan & Lease Index posted a negative annualized net loss rate for the second time this year, as recoveries outpaced charge-offs during the month. The negative value reflects the impact of recoveries in the form of liquidation proceeds of equipment as well as a meaningful level of “cured defaults.” Cured defaults represent contracts that have aged into technical default in prior periods but then fall out of a defaulted status in later periods when true-up payments are made to bring the contract current. Meanwhile, the percentage of payments 60+ days past due climbed 10 basis points month-over-month to 0.70 percent but remained near post-crisis lows.

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KBRA is a full-service credit rating agency registered in the U.S., the EU and the UK, and is designated to provide structured finance ratings in Canada.