15 Jun
U.S. credit card defaults rise to record in May
U.S. credit card defaults rose to record highs in May, with a steep deterioration of Bank of America Corp’s lending portfolio, in another sign that consumers remain under severe stress.
Delinquency rates — an indicator of future credit losses — fell across the industry, but analysts said the decline was due to a seasonal trend, as consumers used tax refunds to pay back debts, and they expect delinquencies to go up again in coming months.
“I find it hard to believe that it is really a trend. You need to see stabilization in unemployment before you see anything else,” said Chris Brendler, an analyst at Stifel Nicolaus. “It is too early to see some kind of improvement.”
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