Consumer Payment Card News

Delinquency Spike

Credit card delinquency, based on the number of accounts 30+ days past due, hit an all-time high of 4.43% in the fourth quarter. Based on total dollars outstanding, bank card delinquencies rose to 4.92%, compared to the previous quarter’s 4.66%, but below the record of 5.45% set in 1996. The news comes as all major closed-end consumer loan delinquencies decreased during the fourth quarter. According to the American Bankers Association’s latest “Consumer Credit Delinquency Bulletin,” it is a rare combination wherein credit card delinquencies increased as all other consumer lending delinquencies declined. The ABA blames weak job creation for keeping credit card delinquencies at persistently high levels. The ABA noted that the average length of unemployment remained near 20 weeks in the fourth quarter. Also energy costs rose and, on average, financial obligations remained above 18% of personal income.

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|_6. 4Q CREDIT CARD DELINQUENCY HISTORY |
|_6. (based on total dollars outstanding) |
|_. 2003: 4.92% | 1999: 4.28% | 1995: 4.45% | 1991: 4.61% | 1987: 3.65% | 1983: 2.74%|
|_. 2002: 4.63% | 1998: 4.62% | 1994: 3.20% | 1990: 4.46% | 1986: 4.80% | 1982: 3.57%|
|_. 2001: 4.67% | 1997: 5.38% | 1993: 3.64% | 1989: 3.22% | 1985: 3.88% | 1981: 2.26%|
|_. 2000: 4.25% | 1996: 5.45% | 1992: 4.11% | 1988: 3.40% | 1984: 2.85% | 1980: 3.00%|
|_6. Source: American Bankers Association Delinquency Bulletin |

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