Consumer Payment Card News

Credit Card Late Payers Among Top 100 Banks Hit a Six-Year High in Q4

The number of credit card late payers grew to highest level since the first three months of 2013. The Top 100 banks report consumer credit card delinquency, those whose account(s) have fallen more than 30 days late or past the due date, has been slowing edging upward throughout the last six years, despite the robust American economy.

Credit Card Late Payers Rising in 2019

Delinquency Rate

The 30+ day delinquency rate, seasonally adjusted (SA), among the top 100 U.S. banks for the fourth quarter (4Q/18) increased five basis points (bps) from 3Q/18, and up six bps year-on-year (YOY), according to figures released yesterday by the Federal Reserve.

On a not seasonally adjusted basis (NSA), the delinquency rate among the top 100 U.S. banks for 4Q/18, jumped 10 bps from the prior quarter and up seven bps YOY.

In the first quarter of 2015 the SA delinquency ratio was 2.06%, and the NSA delinquency ratio was 2.08%.

According to the Federal Reserve, the top 100 U.S. banks posted a 30+ day SA delinquency rate of 2.54% for 4Q/18, compared to 2.49% in 3Q/18, and 2.48% for 4Q/17.

On a NSA basis the top 100 U.S. banks posted a 30+ day delinquency rate of 2.58% for 4Q/18, compared to 2.48% in 3Q/18, and 2.51% for 4Q/17.

Top 4 Issuers Delinquency

Early stage delinquency (30+ days) for the fourth quarter (4Q/18), among the nation’s Top 4 issuers, increased 13 basis points (bps) sequentially, and edged up year-on-year (YOY) by 16 bps.

According to CardData, the average rate among the top four issuers (Chase, Capital One, Bank of America, Citibank) was 2.40% for 4Q/18, compared to 2.27% for 3Q/18 and 2.34% for 4Q/17.

The uptick in credit card delinquency, coupled with a recession forecast, is loan-loss reserves increasing, the metrics are expected to rise throughout 2019, according to RAM Research.

Credit card delinquency (30+ days) for the fourth quarter (4Q/18), among the nation’s Top 4 issuers, increased 13 basis points (bps) sequentially, and edged up year-on-year (YOY) by 16 bps.

The nation’s largest issuer, Chase, reported delinquency increased to 1.83% in 4Q/18, compared to 1.75% for 3Q/18 and 1.80% for 4Q/17, a 3 bps gain YOY. 

The nation’s fastest growing issuer, Capital One, reported delinquency rose to 4.04% in 4Q/18, compared to 3.80% for 3Q/18 and 4.01% for 4Q/17, an 3 bps increase YOY. 

The nation’s third largest issuer, BofA, reported delinquency increased to 2.02% in 4Q/18, compared to 1.90% for 3Q/18 and 1.92% for 4Q/17, an 10 bps gain YOY. 

The nation’s fourth largest issuer, Citibank, reported delinquency increased to 1.70% in 4Q/18, compared to a revised 1.62% for 3Q/18 and 1.62% for 4Q/17, an 8 bps increase YOY. 

Auto Loan Defaults

Auto loan default rates inched up in the U.S. during December while the overall economy remains vibrant. Baffling, especially among car dealers and auto lenders. Lender concerns are growing as more evidence emerges regarding a potential recession in late 2019 into 2020.

The latest S&P/Experian Consumer Credit Default Indices for December reveals the auto default rate rose from 0.93% to 1.03%. The December numbers also shows the bank card default rate rose from 3.25% to 3.34% and the first mortgage default rate increased from 0.64% to 0.67%.

Top 100 Credit Card Delinquency (Seasonally Adjusted)

4Q/14: 2.15%
4Q/15: 2.15%
4Q/16: 2.36%
4Q/17: 2.48%
4Q/18: 2.54%

Top 100 Credit Card Delinquency (Not Seasonally Adjusted)

4Q/14: 2.16%
4Q/15: 2.21%
4Q/16: 2.41%
4Q/17: 2.51%
4Q/18: 2.58%

Additional Current & Historical Quarterly Data on the Top 100 Credit Card Issuing Bank Credit Card Delinquency