Credit card securitization volume is slightly behind last year’s pace but with another $7 billion of new card deals still scheduled to come to market, year-end volume for the asset class is likely to reach $40 billion, matching 2012 total issuance volume, according to a Deutsche Bank report.
To date, issuance for this sector stands at $23.2 billion, 22.6% behind last year’s volume at this time, according to the report.
Citibank, Chase, Discover and American Express are the top issuers so far this year, “which is a change from 2012 when GE was one of the top four contributors of annual volume and Citi was not,” said Deutsche Bank.
Citi has already contributed $7.7 billion, or 33% of the market in 2013, compared to $500 million, or about 1% to the 2012 market. GE’s contribution to 2013 volumes, by contrast, stands at 969 million, or 4% of the market. In 2013 GE’s share of issuance was $5 billion, or 13% of the market.
Credit Card ABS outstanding currently stands at $124 billion, according to Deutsche Bank. The sector has dealt with increasingly low receivables that have led to a lack of supply for new deals.
However there is some indication that the trend might be reversed. Fitch Ratings noted in its 2Q2013 credit card index report that credit card ABS outstandings had increased for the second straight quarter, reversing a trend of decreasing receivables seen in 2012.
Analysts at Deutsche Bank said that with only $25 billion of card maturities expected in 2014, “new issue activity is likely to rise modestly above 2013’s levels, and net supply should easily break through into positive territory in 2014.”