WASHINGTON -- The percentage of delinquent consumer loans fell 25 basis points in the second quarter, to 2.06%, the lowest level in nine years, the American Bankers Association said Wednesday.

The June 30 results marked the fifth consecutive quarterly decline in the index. In June 1992, delinquencies stood at 2.60%.

A |Debt-reducing Diet'

"Consumers have been on this debt-reducing diet," said ABA chief economist Jim Chessen.

"Consumers are now in a better position to purchase goods and services," he added.

Mr. Chessen added that chargeoffs of loans al banks helped improve the numbers.

Paul Kasriel, an economist at Northern Trust Co. in Chicago, said the data should result in more loan activity.

"These delinquencies are going down because employment is going up," he said. "This is going to increase banks' willingness to extend credit."

Credit Surge

Total consumer installment credit increased, at a seasonally adjusted annual rate of 8.1% in July, the ABA also noted.

The $5.1 billion rise, to $751 billion, was the largest one-month advance since October 1989. The largest gain was in revolving credit, which jumped 12.8% or $2.8 billion.

But Mr. Chessen said that everything isn't coming up roses.

Personal income has been "bouncing around" rather than making any sure progress, he said. He agreed with Mr. Kasriel that job creation is encouraging, but he still thinks "we're going to have slow growth for a considerable period of time."

The composite delinquency rate of 2.06% includes auto, personal, recreational vehicle, marine, and closed-end home equity loans.

Personal and auto loans account. for more than half of the composite figure.

The delinquency rate on personal loans plummeted 39 basis points to 2.59% in the second quarter, while the late rate on auto loans made directly by banks slid 16 basis points, to 1.84%.

Car and Card Loans

The delinquency rate on auto loans made through dealers is slightly higher, at 1.97%, but it too had fallen since the first quarter, when it was 2.31 %.

Bank credit card delinquencies -- which are not included in the composite figure -- also declined. The bank card delinquency rate sank 11 basis points, to 2.63%, in the second quarter. That's the best figure since the third quarter of 1990, when the number of past-due credit card accounts stood at 2.56%.

The lowest delinquency rate was on open-ended home equity lines of credit, which tumbled to 0.66% in June, from 0.70%. Closed-end home equity loans edged up to 1.57%, from 1.48%.

Of the 11 categories of consumer debt tracked by ABA, only closed-end home equity loans worsened in the second quarter.

The three states with the lowest delinquency rates were Florida, at 0.73%; Arizona, at 0.99%; and Wisconsin, at 1.08%.

At the other end of the spectrum were Connecticut and the District of Columbia, at 4.19%, and New York, at 3.95%.

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