The Bankwatch

Tracking the consumer evolution of financial services

Credit Card defaults rising although manageable so far

As noted in Nov 2007, the next thing to watch following sub prime which was already prevalent then was credit card defaults.  It has taken longer than expected which is interesting, but it is now clearly a trend, although being managed so far.  It is clear that credit card companies are pro-actively managing the situation knowing full well that to ignore would bring disaster.  Read Calculated Risk here for examples.

jp.reuters.com

Capital One Chargeoffs Rise To 9.4%; American Express Chargeoffs 10%; Card Issuance Drops 50%

Credit cards losses are accelerating at Capital One, a trend one should expect to continue given the rapidly rising unemployment rate. Interestingly, Capital One is returning TARP funds.

Rising defaults are also being noted in Japan as an issue.

5月の米クレジットカードローンのデフォルト率、過去最悪を更新

[ニューヨーク 15日 ロイター] 米国のクレジットカード利用者によるデフォルト(債務不履行)が5月に過去最悪を更新し、米国の消費者が置かれた厳しい状況が浮き彫りになった。

また、規模が小さいキャピタル・ワン・フィナンシャル(COF.N: 株価, 企業情報, レポート)やディスカバー・フィナンシャル・サービシス(DFS.N: 株価, 企業情報, レポート)では、デフォルト率の上昇幅は予想を下回った。デフォルト率は、キャピタル・ワン・フィナンシャルが8.56%から9.41%に、ディスカバー・フィナンシャルは8.26%から8.91%に上昇した。

Researched by Nobuyo Henderson: – Credit Card companies are next to have financial problems.

Written by Colin Henderson

June 15, 2009 at 22:51

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