U.S. structured finance is expected to be stable from a credit and ratings standpoint, although macro uncertainties can test collateral performance for some asset classes, Fitch Ratings said in its 2012 outlook report.
"After a fast start this year, macro concerns and regulatory developments tapped the brakes on the pace of the recovery for structured finance," said Kevin Duignan, head of U.S. structured finance at Fitch.
From a credit and ratings perspective, the outlook for structured finance sectors is stable based on criteria enhancements, higher quality collateral compositions, and enhanced structures implemented over the past few years.
The ratings also proved resilient to the crisis for the most part even with significant collateral performance deterioration and following almost two years of sustained performance improvements, the rating outlook remains stable to positive for most ABS sectors except the student loan sector.
"Improvements will continue, albeit at a modest pace, for structured finance next year," Duignan said.