Card Delinquencies Lowest Since TV’s ‘Friends’ Debut, ABA Says
U.S. bank-card delinquencies have dropped to their lowest levels in more than 18 years as borrowers maintain a conservative approach to personal finances, according to an American Bankers Association report.
The rate of bank card accounts 30 days or more overdue fell to 2.47 percent in the fourth quarter of 2012, according to the quarterly report from the Washington-based industry group. That’s the lowest ABA-recorded rate since NBC’s ‘Friends’ first aired and Tiger Woods became the youngest golfer to win the U.S. Amateur Championship in 1994.
The delinquency rate is down from 2.75 percent in the third quarter of 2012 and is well below the 15-year average of 3.87 percent, the ABA said in a statement. ABA Chief Economist James Chessen credited the decrease to consumers wanting to protect themselves against continuing economic uncertainty.
“Consumers continue to carefully manage their finances in an effort to get debt levels under control and build up a secure financial base,” Chessen said in a statement. “The sharp decline in delinquencies reinforces the notion that the economic recovery has become more self-sustaining and is on a path to increased growth.”
Chessen said that three home-related loan categories tracked by the report also showed delinquency declines -- the first time in a year they were all down at the same time. The home-related delinquencies still “remain at elevated levels,” he said.