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ABA study: Card delinquency stays low

Summary

Despite an uptick at the end of 2014, delinquencies for credit cards issued by banks remained well below the 15-year average, American Bankers Association research shows

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Consumers have fresh confidence in the economy, but remain wary about adding additional debt, including credit cards, the American Bankers Association says.

Bank card delinquencies rose ever so slightly at the end of 2014, going from 2.51 percent at the end of the third quarter to 2.52 percent at the end of the fourth, according to the ABA’s quarterly Consumer Credit Delinquency Bulletin. That’s well below the 15-year bank card delinquency average of 3.75 percent, and just about half of what it was when delinquencies peaked in the aftermath of the recession. The report counts as delinquent any late payment overdue 30 days or more.

“As credit access and consumer spending increase, the overwhelming majority of cardholders continue to pay off or pay down their balances month after month,” chief ABA economist James Chessen said in a news release.  “We expect this trend to continue as consumers remain laser-focused on keeping debt at manageable levels.”

The association’s credit card findings are in line with the other 10 types of loans tracked by the ABA in its quarterly bulletin. “Consumers have regained confidence since the last recession, but they remain careful about taking on additional debt,” Chessen said.

The data were collected at the end of 2014 from a panel of 250 FDIC-insured financial institutions. Banks from each state were included. Delinquency ratios reported by individual banks were weighted by portfolio size to derive the summary ratios.

 

See related:Settling delinquent debt won’t remove it from your credit report, More infographics

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