Investment Executive on Nostr: U.S. credit metrics deteriorate in Q1: DBRS ========== Credit performance of major ...
U.S. credit metrics deteriorate in Q1: DBRS
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Credit performance of major U.S. credit card issuers weakened in Q1 2024, with the weighted average net charge-off rate rising to 4.2% from 3.6% in Q4 2023, surpassing pre-pandemic levels. The weighted average 30+ day delinquency rate increased by about 70 basis points from the same quarter last year and is now 60 basis points higher than pre-pandemic periods. DBRS expects further weakening in the credit card sector's performance but stabilization towards normalized levels by early 2025. Credit card balances grew by 11% YoY in Q1, but the growth rate slowed for the seventh consecutive quarter. Spending was driven by higher-income households, while inflation impacted spending by less-affluent households. The report highlights the potential contraction in the U.S. economy due to a higher interest rate environment as a key downside risk to the outlook for U.S. credit card issuers.
#CreditMetrics #CreditCardIssuers #CreditPerformance #DelinquencyRate #ChargeoffRate #CreditCardBalances #UsEconomy #InterestRateEnvironment
https://www.investmentexecutive.com/news/research-and-markets/u-s-credit-metrics-deteriorate-in-q1-dbrs/
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Credit performance of major U.S. credit card issuers weakened in Q1 2024, with the weighted average net charge-off rate rising to 4.2% from 3.6% in Q4 2023, surpassing pre-pandemic levels. The weighted average 30+ day delinquency rate increased by about 70 basis points from the same quarter last year and is now 60 basis points higher than pre-pandemic periods. DBRS expects further weakening in the credit card sector's performance but stabilization towards normalized levels by early 2025. Credit card balances grew by 11% YoY in Q1, but the growth rate slowed for the seventh consecutive quarter. Spending was driven by higher-income households, while inflation impacted spending by less-affluent households. The report highlights the potential contraction in the U.S. economy due to a higher interest rate environment as a key downside risk to the outlook for U.S. credit card issuers.
#CreditMetrics #CreditCardIssuers #CreditPerformance #DelinquencyRate #ChargeoffRate #CreditCardBalances #UsEconomy #InterestRateEnvironment
https://www.investmentexecutive.com/news/research-and-markets/u-s-credit-metrics-deteriorate-in-q1-dbrs/