India securitisation volumes 2024: Has co-lending taken the sheen?
Team Finserv | finserv@vinodkothari.com
Three rating agencies reported different numbers, but barring the exception of one, the other two hold that the volumes in FY 24 have been lower than the last peak, FY 20. FY 20 was exceptional – it was the year post ILFS, where all balance sheet lenders and investors to NBFCs rushed to off balance sheet transactions, as bankruptcy remoteness became the key objective. The next year was an exception again – Covid wave. However, FY24 was a year of brisk economic lending, and retail credit expansion. There were, therefore, strong reasons that the watermark reached in FY 20 will be crossed. However, it just remained slightly off that, or, if the numbers given by Care Ratings are to be trusted, marginally crossed the mark.
One obvious reason is the merger of HDFC with HDFC Bank. The two contributed major chunks to Direct assignment volumes. Estimated volume lost due to the merger is around INR 40000 crores[1]. However, the other instrument that has dug a shovel in securitsation/ DA volumes is the rise in co-lending.
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