Big Issuers Seeing Improvements

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WASHINGTON-The financial picture is improving a bit for some of the biggest credit card issuers.

The Office of the Comptroller of the Currency recently released its Survey of Credit Underwriting Practices 2011, and among the findings:

  • 25% of 16 banks offering credit cards eased their underwriting standards through reducing credit score cutoffs and increasing credit limits. This marks the first time that credit card underwriting standards have loosened since 2008, with the study suggesting the loosening is the result of economic outlook, competition, strategy, and government regulations.
  • 44% of the banks that offer credit cards tightened underwriting standards, but this was down from 81% last year; 31% left the standards unchanged.
  • Credit risk in card portfolios increased in only 6% of banks compared with 94% in the 2010 survey. Credit risk decreased in 69% of the banks.

The study assessed underwriting standards at 54 of the largest national banks with assets of $3 billion or more.

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