U.S. credit card delinquencies hit a six-month low in March, and chargeoffs declined for a second-straight month, Fitch Inc. said Friday — further signs that credit woes may have peaked.
But the ratings agency reiterated that U.S. consumer credit quality remains under pressure as the pace of deterioration moderates.
Chargeoffs among prime-rated customers fell 0.34%, to 10.93%, in the March reporting period, a 17% increase from a year earlier. A 2.34-point decline in Bank of America Corp.'s chargeoffs led the drop.
"Emerging signs that the consumer recovery may [have begun] could translate to lower chargeoff rates later in the year, although we need to realize sustained improvement in the labor markets," said Fitch Managing Director Michael Dean.
Meanwhile, the rate of accounts at least 60 days past due dropped 0.17 point, to 4.27%, and the 30-day delinquency rate fell 0.11 point, to 5.74%. The amount of monthly balances paid by customers rose 0.56 point, to 19.35%, up 9% from a year earlier.