Credit performance continued to deteriorate in the May ABX remittance reports released last week.

However, Lehman Brothers analysts said that there was a ray of hope - the pace of the increase in delinquent loans slowed down on seasoned indices. For instance, the balance of delinquent loans on the ABX 06-1 index at 34 WALA increased by a mere 10 basis points in April and 20 basis points in March, according to analysts.

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