ATLANTA (11/26/13)--Retail-issued credit cards total 183 million, the most since September 2009, said Equifax in its latest National Consumer Credit Trends Report
. Balances passed the $56 billion mark, a year-over-year increase of more than 6.4%.
New credit issued from January to August of 2013 totaled $46.6 billion, up 11.6% from the same period in 2012, said Equifax.
During the first eight months of 2013, roughly 24.6 million new card accounts were issued--the highest since 2008 and an increase of 8.8% from a year earlier. Year-to-date lending through August to subprime credit borrowers with Equifax Risk scores below 660 increased 15.8% over the period in 2012, with a six-year high of 8.2 million loans originated.
Write-offs and delinquencies were down. Retail-issued credit card write-offs dropped nearly 14%--to 7.09% from 8.24% in October 2012. During that time, 60-day delinquency rates for retail cards fell slightly, to 3.48% from 3.52%.
"The holiday season is almost upon us and retailers are eager to capture the hearts and wallets of the American consumer," said Equifax Chief Economist Amy Crews Cutts. "Retailers can leverage these cards to drive traffic to their stores through special offers to cardholders and can encourage larger purchases by offering favorable interest-rate promotions for big ticket items. As long as consumers resist the urge to overspend, these cards can be a great way to save money."
Credit cards issued by credit unions and other financial institutions totaled $128.7 billion. The total limit of new credit issued from January to August 2013 is a five-year high for that period and is up 9.1% from the same period last year, which totaled $117.9 billion, said Equifax.
Other findings for financial institution-issued cards:
- The number of new loans January-August 2013 totaled 27.6 million, a five-year high and an increase of 7.3% from same time a year ago.
- Existing loans in October totaled more than 312 million, the highest since December 2009.
- The outstanding balance on financial institution-issued credit cards totaled $537.2 billion and represents a year-over-year increase for four consecutive months. This marks the first time in more than five years that such an increase has occurred.
- From October 2012 to October 2013, the 60-day delinquency rates decreased 13.6% (from 2.18% to 1.88%), while write offs dropped 18.4% (to 3.92% from 4.81%).
Auto loans in October totaled nearly 62 million, a five-year high. The 29.9 million loans financed by credit unions and other financial institutions totaled $411.6 billion, all-time highs for both figures. Comparable numbers funded by auto finance companies were $435.1 billion financed for 32 million loans, the highest level since January 2009. More than $327.3 billion in auto loan originations were made January to August 2013. That is a 15.6% increase from a year earlier and the most new credit originated for the first eight months of a year in more than eight years.
Mortgage loans decreased in October, with first mortgage balances totaling $7.6 trillion, down 1.7% from a year earlier. Severe delinquencies (90 days past due or in foreclosure) for first mortgages totaled less than $300 billion for the first time in more than five years. The figure represents a decrease of more than 30% from the same period in 2012.