Credit card delinquencies fall to lowest level in four years

Fitch Rating’s index of delinquencies of 60 days or more for credit card ABS dropped to its lowest level in nearly four years in June.

At 2.57 percent, it is the metric’s lowest level since August 2007. The gauge indicates the number of balances associated with borrowers who have missed more than two payments, according to the Wall Street Journal.

The latest Credit Card Performance Index results from Fitch further indicate improving trends in consumer debt as other metrics measured by the firm hit multi-year lows.

“Credit card collateral saw positive across the board gains for the fourth time in six months,” Fitch senior director Cynthia Ullrich said, according to the Wall Street Journal. “Future credit card performance looks promising, with Fitch anticipating smooth sailing during the second half of this year.”

Fitch’s Prime Credit Card Charge-off Index for June also posted its third month-over-month improvement, down another 13 basis points to 7.29 percent. This represents a 2.5 year low.

The large trusts that make up the majority of the index, including Bank of American, Capital One, Citibank and Discover, with the exception for Chase, all reported monthly improvements in default rates.  

Fitch's Prime Credit Card index was established in 1991 and tracks more than $150 billion of prime credit card ABS backed by approximately $266 billion of principal receivables.

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