Buoyed by solid credit performance, consumer ABS sectors are expected to perform well in 2008, and those asset classes might even see issuance increase by as much as 12% over the volume for 2007, according to early estimates from analysts at Citigroup Global Markets.
Such an accomplishment will come with challenges, Citigroup warned. In an environment where spreads are at historically wide levels in all sectors, some transactions have failed to price, and the subordinate market is all but shut down. Despite all of this, credit card supply should be flat to slightly above volumes for 2007; auto ABS paper could see a 20% increase, and the student loan ABS sector could see business grow by 20%. Commercial ABS and other asset classes could see 10% growth.