Fitch: U.S. Credit Card ABS Bounces Back in 3Q'14 after Minor Setback

Link to Fitch Ratings' Report: Credit Card Index: Movers & Shakers -- North America (3Q14)
http://www.fitchratings.com/creditdesk/reports/report_frame.cfm?rpt_id=795208

A second-quarter increase in chargeoffs proved to be little more than a seasonal blip as performance bounced back strong for U.S. credit card ABS, according to the latest quarterly index from Fitch Ratings.

Credit card chargeoffs fell every month during third-quarter 2014 (3Q'14) while average losses dropped to 2.71% from 3.07% in 2Q'14. Losses again dipped below the 3% mark last quarter, falling to as low as 2.58% during August.

Monthly payment rates also improved last quarter, with a record index high of 28.28% set in August. 'The strong monthly payment rate numbers we saw last quarter is largely reflective of overall higher quality credit card borrowers steadily making on-time payments,' said Managing Director Michael Dean.

This comes as 60 day delinquencies for credit card ABS continued to set new records in 3Q'14. 'Late payments for credit card ABS dipped below 1% last month for the first time ever,' said Dean. Current delinquencies are roughly 18% lower than the same period in 2013. Additionally, credit card ABS outstandings also increased for the seventh straight quarter to levels not seen in nearly three years.

The U.S. Credit Card ABS Index is part of Fitch's series of structured finance index reports. The index reports are updated quarterly and are available at 'www.fitchratings.com' or by clicking on the above link.

Additional information is available at www.fitchratings.com.

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