NEW YORK (LowCards.com) -- Credit card defaults and late payments dropped again in April, falling to levels last seen in 2008. Five of the six top credit card companies reported delinquencies and defaults dropped in April to multiyear lows.
This is another sign of recovery for credit card issuers.
After the economic downturn began in 2008, lenders drastically cut credit limits on millions of cardholders, canceled accounts on their riskiest borrowers and tightened approval requirements for new customers. Many cardholders have also steadily paid down credit card balances. These changes are all playing a factor in these declining default and late payment figures.
|Bank of America was the only major credit card issuer that reported a rising default rate in April.|
- Bank of America (BAC) was the only major issuer that reported a rising default rate in April. The bank's annualized charge-off rate, which reflects uncollectible balances, was 8.25%, up from 8.18% in March. Bank of America's charge-off rate peaked at 14.53% in August 2009. Late payments dropped to 4.52% of balances annualized (the lowest level for the bank since mid-2006), down from 4.82% in March.
- American Express (AXP) still leads the industry with the lowest rate of charge-offs and defaults. Charge-offs were 3.5% of balances on an annualized basis for April, down from 3.7% in March. Late payments were 1.7% in April, down from 1.8% in March.
- Citi's (C) default rate was 7.85% of balances on an annualized basis, down from 7.89% in March. Late payments fell to 3.87% in April, down from 4.21% in March.
- Capital One (COF) defaults dropped to 4.97% annualized. That was down from 5.87% in March. Late payments dropped to 3.41% of balances, down from 3.59% in March.
- Discover's (DFS) charge-off rate was 5.02% of balances in April, down from 5.18% in March. The delinquency rate dropped to 3.15% in April, down from 3.42% in March.
- JPMorgan Chase (JPM) defaults were 5.6% in April, down from 6.02% in March. Late payments dropped to 2.86%, down from 3.08% in March.
Select the service that is right for you!COMPARE ALL SERVICES
- $2.5+ million portfolio
- Large-cap and dividend focus
- Intraday trade alerts from Cramer
- Weekly roundups
Access the tool that DOMINATES the Russell 2000 and the S&P 500.
- Buy, hold, or sell recommendations for over 4,300 stocks
- Unlimited research reports on your favorite stocks
- A custom stock screener
- Upgrade/downgrade alerts
- Diversified model portfolio of dividend stocks
- Alerts when market news affect the portfolio
- Bi-weekly updates with exact steps to take - BUY, HOLD, SELL
- Real Money + Doug Kass Plus 15 more Wall Street Pros
- Intraday commentary & news
- Ultra-actionable trading ideas
- 100+ monthly options trading ideas
- Actionable options commentary & news
- Real-time trading community
- Options TV