Charge offs by major credit card companies rise in November

Posted Dec 15th 2009 4:20PM by Connie Madon
Filed under: Industry, Money and Finance Today, Economic Data, Personal Finance, Headline News

Charge offs are rising among our largest credit card companies, up 8.81% in November, from 8.02% in October.

Here are specific bank reports:

For Capital One (COF), charge offs rose to 9.60%, from 9.04%
Capital One expects its charge offs to peak early next year.
Discover Financial Services (DFS) rose 8.98%, from 8.54%.
Bank of America (BAC) had the largest charge offs at 13%, down a tad from 13.22% in October.
Bank of America late payments rose to 7.69% from 7.59%.

With unemployment still rising, charge offs are also up. This is in spite of card companies closing thousands of accounts and slashing credit lines. Banks are also raising card rates to astronomical levels, keeping the consumer in perpetual debt.

Americans are paying off debt, hoarding cash. Until the economy shows signs of definite improvement, these trends are not likely to reverse themselves quickly.

Foreclosures are not showing signs of declining, putting further pressure on credit.

President Obama is begging bankers to lend more money. If they do so, we could see more consumer credit being issued next year.

Have your credit card rates gone up?

Tags: credit, credit card charge offs, inthenews

Print this

Reader Comments (Page 1 of 1)

12-15-2009 @ 8:33PM

william lindblad said...

Yes and no. Rates have gone up substantially, but zero is always zero and if one is on the high end of the credit score there are ways of beating them at their own game. Paying off the balance at the end of the month works well also. One should also keep in mind that these companies MUST get some interest, albeit, that can be kept minimal. Credit is a tool and if you can use it well, it will always work for you.
The modern world will not run well without it.

There will be an abundance of default and that is why credit is tight. The default is expected and it will not effect markets to any large degree.

Inflation anyone? Beats me on that one as I don't see it. Price of onions are still the same. Have to wait until Feb. to see if I am correct.

12-16-2009 @ 2:20PM

Louise said...

they don't let you charge, they went up on rates, IF THEY WOULD GIVE YOU A MONTH TO PAY BILL WITH NO CHARGE IT WOULD BE BETTER FOR US WORKING PEOPLE. PEOPLE THINK IT IS JUST AS EASY TO PAY CASH, AS YOU HAVE TO PAY FOR IT IN A WEEK ANY WAY.