Posted by admin on Sep 24, 2009

 

According to Fitch Ratings July 2009 charge-off rate for prime credit card portfolios declined 10.55% or 24 basis points over June 2009.  This marked the end of five consecutive months of record highs for charge-offs.

Charge-offs often increase in the fourth quarter.  However, Fitch predicts this will be less likely this year because so many delinquencies have already occurred.

Charge-offs rose 45% from February 2009 through July 2009 and are 63% above figures for the same periods in 2008.  Accounts receivables more than 60 days past due are still at record highs but show some signs of stability.

According the Fitch managing director, Michael Dean, "We still need to see some measurable improvement in the delinquency and personal bankruptcy figures and the employment situation overall before charge-offs revert to more historical norms.  For now, we expect charge-offs to moderate at these elevated levels in the coming months."

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