Credit card charge-offs, among “prime” asset-backed securities, edged down during July, but, the 60+ day delinquency ratio edged upward. However, the persisting effects of the federal bankruptcy reform act enacted last fall will eventually push charge-offs for U.S. credit card asset-backed securities to historical levels as delinquencies begin filling the vacuum created by personal bankruptcy filings. According to FitchRatings, “prime” charge-offs for July were 3.44%, 14 basis points lower than June and compared to 5.98% one-year ago. The “prime” 60-plus day delinquency index for July was 2.30%, compared to 2.28% in June.
ABS PRIME CHARGE-OFFS HISTORICAL
Ju1 05: 5.98%
Jun 06: 3.58%
Ju1 06: 3.44%