Deal Pack Blog

BHPH: Static Pool Analysis

posted on: January-18-2013
by: Deal Pack
category: News

In the BHPH Industry, you may have heard the terms, “Static Pool” and “Static Pool Analysis” thrown around. Now maybe you understand static pool’s, and know exactly how to analyze them. Maybe you have heard of static pools and have even seen a static pool report, but it still just doesn’t seem to make sense. Lastly, maybe you have no idea what I’m talking about and have never heard of such an analysis before. I’d like to shed some light on this type of portfolio analysis and highlight the value of static pools and show you how Deal Pack can help you in analyzing them!

 

Let us begin with the first term, “Static Pool”. What does it mean? A static pool in the BHPH industry is a stationary (static) group (pool) of loans. The standard pool used in the industry is individual months. So we have a stationary group of loans sorted by the individual month that the loan was created.

 

Before a bank will provide capital to your dealership, they will most likely need to have a look at your portfolio to analyze the amount and frequency of losses caused by repossessions and charge-offs. This is where the “Static Pool Analysis” comes into play. This analysis consists of looking at each month of a static pool of loans, to see how many accounts were charged-off or repossessed (by month) and what the total dollar amount of losses caused by those charge-off/ repossessions (by month). This analysis can be very valuable for negotiating contract terms with new customers, as well as when to concentrate more resources or effort to collections.

 

Deal Pack is a DMS that can accurately track this information for you! Use Deal Packs built in “Static Pool Analysis” report, which will give you all of the information you need with the click of a button. Use this report to get a static pool analysis on repossessions and charge-offs for the last 48 months. It will display the origination month and year for a set pool of loans on the left hand side of the report. Scrolling to the right of the report you will see, sorted by number of months since inception date, the number of loans charged off and the accounts receivable balance at time of the repossession/ charge-off.

Subscribe to Deal Pack Blog

Enter your email address and be notified of new posts.