Fitch says 10% US credit card APR cap would materially reduce ABS loss cushion

Fitch's note on the potential impact of a 10% APR cap on US credit cards indicates a significant regulatory shift that could weaken the protective buffers for asset-backed securities (ABS).

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Fitch says 10% US credit card APR cap would materially reduce ABS loss cushion

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Context

This could result in higher risks for investors exposed to ABS backed by credit card receivables, affecting valuations and potentially leading to tighter credit conditions. Overall, this development suggests a need for caution in the ABS market as it may heighten perceived risks and influence investor sentiment.

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