Most of the top credit card issuers reported increases in chargeoffs in regulatory filings this week, reversing a trend of several months of decline.
Capital One Financial Corp., Discover Financial Services, Bank of America Corp., JPMorgan Chase and Citigroup Inc. all reported rising credit card chargeoffs in August. American Express managed to keep its charge-off rate steady during the month.
Capital One’s charge-off rate increased to 8.19% in August from 8.13% in July. Charge-off rates at Bank of America increased to 11.73% from 11.39% in July. JPMorgan’s charge-off rates moved up to 8.18% in August from 7.95% in July. Discover reported a charge-off rate of 7.98% in August, up from 7.28% in July. Charge-off rates at American Express were unchanged at 5.5% in August.
There were some positive signs in the bank reports. Delinquent accounts, the rates at which customers are making payments late by 30 days or more, fell for each of the issuers that reported. That's usually a sign of future loan losses - meaning chargeoffs could improve in the coming months.
Citi’s delinquency rate for loans due over 30 days decreased to 4.95% in August from 5.3% in July. At Capital One, the delinquency rate decreased to 4.56% in August from 4.66% in July. The rate at Bank of America fell to 5.68% from 5.92% in July. JPMorgan’s delinquency rate fell to 3.89% from 4.06% while that at Discover decreased to 4.47% in August from 4.72% in July. American Express’ delinquencies fell to 2.4% from 2.6%.
