Average U.S. consumer bankcard and private-label credit card charge-offs fell again in November, and that trend may continue into this year, according to new data Fitch Ratings Inc. released Jan. 4.
Although charge-off rates are still elevated from historic levels, they “are pointing in the right direction” for issuers looking for better card-portfolio performance compared with the last two years, Michael Dean, Fitch managing director, said in a press release. “Further gains on the labor front could drive more-meaningful consumer credit-quality improvement in the first half of 2011,” he added.
Fitch’s Prime Credit Card Charge-Off Index, or the average percentage of loans charged off among issuers’ securitized consumer bankcard portfolios, fell 21 basis points at the end of November, to 8.99% compared with 9.2% a month earlier. The index during the past several months has fallen 238 basis points from its peak of 11.37% in February, Fitch said.
The delinquency rate in November on consumer bankcard accounts at least 60 days past due fell six basis points, to 3.37% from 3.43% the previous month, Fitch said.
Total outstanding bankcard receivables Fitch tracks stood at $182.71 billion at the end of November, down 3.9% from $190.1 billion in October.
The charge-off rate for private-label retail credit cards through November fell 91 basis points, to 11.87% from 12.78% in October, according to the firm.
The delinquency rate on retail credit cards at least 60 days past due at the end of November was 8.57%, down 19 basis points from 8.76%.
Total outstanding retail credit card receivables Fitch tracks held nearly steady, reaching $41.17 billion at the end of November compared with $41.31 billion a month earlier.
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