Libor, loan forgiveness cast shadow over SLABS

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By Max Adams
13 Jan 2020

Student loan ABS is facing a host of uncertainties this year, as cessation of Libor as a benchmark quickly approaches and momentum behind loan forgiveness accelerates. Strong technical factors will be offset by headline risk, weighing on spreads, according to sources.

With headwinds developing in the government backed student loan segment, private and refinanced student loan ABS has shone, with minimal charge-offs and defaults. Coupled with consistent underwriting standards and strong consumer health, private student loan bonds have been a reliable, high credit quality sector for many investors.

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