When David Bowie raised $55 million by securitizing royalties from his back catalog in 1997, the concept was treated as a curiosity.
Nearly three decades on, credit rating agency KBRA says in a new report that it has rated more than $12.9 billion in music royalty bonds since 2020 alone – a figure that has more than tripled from just over $4 billion as recently as 2023.
But KBRA says issuance is about to contract.
KBRA expects music ABS issuance to fall by approximately 25% in 2026, dropping from over $3.3 billion in each of the past two years to slightly more than $2.5 billion – “primarily because of continued issuer consolidation.”
The agency has now assigned 81 ratings on music royalty ABS across 18 issuers since 2020, it said in the report, titled Playback: Issuance, Industry and Performance Trends in Music ABS, published on Thursday (May 14).
KBRA noted that consolidation “may have mixed implications for music ABS, potentially improving collateral diversification and servicing scale while reducing issuance activity if acquired catalogs migrate to investment-grade platforms.”
The forecast comes amid a wave of industry consolidation involving companies who’ve been active in the music ABS space:
According to the KBRA report, four of its rated music royalty ABS transactions have involved “issuer acquisitions, manager transitions, or publicly reported potential acquisitions” since the beginning of 2025 – “representing the highest level of such activity since the asset class reemerged in 2020.”
Despite the expected dip in issuance volumes, the KBRA report noted that the sector’s issuer base has expanded.
The number of unique issuers in the sector has doubled from nine in 2023 to 18 as of 2026, the agency noted – “providing a stronger foundation for long-term sector stability.”
“Although annual issuance volumes have remained somewhat volatile, the sector has demonstrated increasing consistency as a broader issuer base has reduced reliance on a small number of repeat issuers and supported a steadier transaction pipeline,” KBRA said.
Debt service coverage ratios (DSCRs) across the sector “have remained relatively stable, although pockets of underperformance highlight certain transaction- and catalog-specific risks,” the agency added.
On average, DSCRs have “trended lower, primarily because of refinancing terms and lower DSCRs at issuance,” according to the report.
Across the 81 ratings KBRA has assigned in the music ABS asset class, ratings “have generally remained stable,” the agency said, adding that it “expects continued rating stability across the sector.”
The Playback report is KBRA‘s fourth dedicated publication on the music ABS sector, following The Beat Goes On (2023), Sound Check (2025), and Track Split (2025).
Those reports have charted the sector’s growth in real time: KBRA reported 38 ratings across nine issuers totaling over $4 billion in 2023; 64 ratings across 15 issuers totaling approximately $8 billion by May 2025; and 76 ratings across 15 issuers totaling approximately $11.5 billion by October 2025.
The music ABS market has attracted a wave of new entrants in recent years, with deals from Chord Music Partners, Seeker Music Group, Influence Media Partners, Duetti, and HarbourView joining established issuers such as Concord and Sony-bound Recognition Music Group (formerly Hipgnosis).
In April, a new issuing vehicle linked to UMG-backed Chord Music Partners priced $500 million in debt through an ABS transaction backed by an $830 million catalog.
In March, Seeker Music Group closed a $267 million ABS – its first – backed by a portfolio of more than 19,000 copyrights and master recordings.Music Business Worldwide
In 1997, David Bowie made headlines by raising $55 million through the securitization of his music royalties, a concept that was then considered rather unconventional. Fast forward nearly 30 years, and the landscape of music royalty bonds has evolved significantly. According to a recent report from credit rating agency KBRA, over $12.9 billion in music royalty bonds have been rated since 2020, a substantial increase from just over $4 billion in 2023. However, KBRA predicts a contraction in the issuance of music asset-backed securities (ABS), forecasting a 25% decline in 2026, with totals dropping from over $3.3 billion in recent years to just above $2.5 billion. This decrease is attributed mainly to ongoing issuer consolidation.
The KBRA report, titled « Playback: Issuance, Industry and Performance Trends in Music ABS, » highlights that the agency has assigned ratings to 81 music royalty ABS transactions across 18 different issuers since 2020. While consolidation within the industry could improve collateral diversification and servicing scale, it may also lead to reduced issuance if acquired catalogs transition to investment-grade platforms.
The report notes a significant increase in industry consolidation, with four rated music royalty ABS transactions involving acquisitions or transitions in management since the beginning of 2025—the highest level of such activities since the asset class gained traction in 2020. Despite the anticipated reduction in issuance volumes, the number of unique issuers in the market has doubled from nine in 2023 to 18 in 2026, suggesting a more stable foundation for the sector in the long term.
While the annual issuance of music ABS has shown volatility, the increasing variety of issuers has helped lessen reliance on a few repeat players, fostering a more consistent transaction pipeline. Debt service coverage ratios (DSCRs) within the sector have remained stable overall, although some underperformance has been noted in specific transactions and catalogs. The average DSCR has trended lower, primarily due to refinancing terms and lower ratios at issuance.
KBRA reports that the ratings assigned within the music ABS sector have remained mostly stable, and it anticipates continued stability in ratings across the industry. The « Playback » report marks KBRA’s fourth dedicated publication on music ABS, following previous reports titled « The Beat Goes On » (2023), « Sound Check » (2025), and « Track Split » (2025). These publications have tracked the sector’s growth in real time, with KBRA reporting an increase in ratings from 38 across nine issuers totaling over $4 billion in 2023 to 76 ratings across 15 issuers amounting to approximately $11.5 billion by October 2025.
The music ABS market has seen a surge of new entrants in recent years, with notable deals from firms such as Chord Music Partners, Seeker Music Group, Influence Media Partners, Duetti, and HarbourView, in addition to established players like Concord and Sony-bound Recognition Music Group (formerly known as Hipgnosis). For instance, in April, a new issuing vehicle linked to Chord Music Partners, which is backed by Universal Music Group, successfully priced $500 million in debt through an ABS transaction supported by an $830 million catalog. Additionally, in March, Seeker Music Group conducted its first ABS, closing a $267 million deal backed by a portfolio of over 19,000 copyrights and master recordings.
In summary, the music royalty ABS market has experienced significant growth and transformation since David Bowie’s pioneering move in 1997. While KBRA anticipates a contraction in issuance due to consolidation among issuers, the sector has also expanded its base, potentially improving stability for the future. The overall health of the market, as reflected in stable ratings and consistent transaction pipelines, suggests a maturing asset class that continues to evolve in the music industry landscape.
