Moody's Investors Service has warned that delinquencies and defaults among Australian motor vehicle loan backed securities are set to move higher in 2016. The performance of the Australian auto loan ABS notes rated by Moody's deteriorated in the three months to 31 December 2015, notably among 30-plus day delinquencies, which have increased to 1.33 per cent, up from 1.20 per cent at 30 September 2015 and 1.07 per cent at 31 December 2014.The ratings agency warned that loans were likely to be further hit by below-trend GDP growth in Australia and uncertain labour market conditions, particularly in the cooling economies of the mining states."ABS portfolios with exposure to commercial loans and leases in Western Australia and Queensland will come under the most pressure, owing to slowing business conditions," said Alena Chen, a Moody's assistant vice president and analyst.Chen said that Moody's forecast was for GDP in Australia to grow by two per cent in 2016. If this came to pass, it would print well below the long-term average of 3.5 per cent.  Despite the year-on-year increase in arrears, default and loss levels remained relatively low. As at 31 December 2015, the 2012 vintage - the most seasoned of outstanding pools - exhibited a cumulative default rate of 1.86 per cent and a net loss rate of 0.87 per cent.Moody's rated three new ABS deals with a total volume of A$2.5 billion during the final quarter of 2015. For all of 2015, Moody's rated $5.1 billion worth of issuance, up from $3.8 billion in 2014. Moody's analysts said they had not rated any new deals in calendar year 2016, although sketchy details on two potential new ABS deals, mandated for ANZ and HSBC, respectively, were being circulated late yesterday.These two deals, which could result in the first Australian ABS issues for 2016, were hinted at in brief announcements yesterday. Volkswagen Financial Services AG has mandated ANZ and HSBC to arrange a series of ABS investor conference calls this week. "A transaction under the Driver Australia ABS programme denominated in AUD may follow, subject to market conditions," said a statement on behalf on the lead bankers, ANZ and HSBC.CNH Industrial Capital Australia also mandated the structured finance team at ANZ "to update ABS investors" on the CNH Industrial Capital Australia Receivables Trust program. A transaction may follow - with the standard "subject to market conditions" caveat.Bankers associated with the deals were keen to stress that they are merely sounding out potential investors this week, with market conditions described as "choppy".