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Strategies & Market Trends : rat's nest -- Ignore unavailable to you. Want to Upgrade?

To: AugustWest who wrote (190)	3/15/2001 8:30:36 AM
From: AugustWest	Read Replies (1) \| Respond to of 844

(PR NEWSWIRE) Late Card Payments Up for Fourth Quarter 2000; Consumers React to Slowing U.S. Economy WASHINGTON, March 15 /PRNewswire/ -- The number of credit card bills paid late increased in the fourth quarter, signaling that some consumers are feeling the effects of the nation's slowing economy, according to the American Bankers Association (ABA) Consumer Credit Delinquency Bulletin. The number of credit card bills paid late increased to 3.34 percent of all accounts (seasonally adjusted), compared to 3.21 percent in the previous quarter, and 3.22 percent a year earlier (fourth quarter 1999). Fourth quarter credit card delinquencies, based on total dollars outstanding, was 4.25 percent (not seasonally adjusted), up from the previous quarter's 3.93 percent but lower than 4.28 percent in the same period last year. "As we expected, the number of delinquent accounts has increased as the economy has slowed," said James Chessen, ABA chief economist. "Consumers who are carrying a higher debt load are most likely to feel the effects of an economic slowdown." "Nonetheless, the delinquency ratio remains within the average rate we've seen over the past five years," said Chessen. The number of delinquent accounts for ABA's composite ratio of closed-end installment loans rose to 2.40 percent of all accounts in the fourth quarter of 2000, compared to 2.32 percent the previous quarter. The ratio-which tracks eight types of closed-end consumer installment loans, including auto, home equity and personal loans-is higher than it was a year earlier (2.27 percent in the fourth quarter 1999). A loan payment is considered delinquent when it is 30 days or more overdue. Direct auto loan late payments increased to 2.17 percent in the fourth quarter of 2000 from 2.12 in the third quarter. Delinquencies for indirect auto loans increased slightly to 2.49 percent, up from 2.46 percent in the third quarter of 2000. Delinquencies on home equity loans, based on the number of accounts, increased from 1.16 percent to 1.46 percent in the fourth quarter. Late payments on home equity lines of credit also increased, from 0.71 percent to 0.81 percent. Home equity numbers are not seasonally adjusted. Home equity lines continue to be the loan category with the lowest delinquencies. "During the fourth quarter of 2000, banks remained conservative in their underwriting standards recognizing the debt burden facing some consumers," said Chessen. "Still, the Federal Reserve's lowering of interest rates early this year should ease the consumer debt-service burden and encourage small businesses to borrow for expansion, which helps keep employment up." The ABA advises consumers to review their finances every year. ABA offers the following tips for consumers who might be having trouble paying down their debts. Warning signs of being overextended on credit: * Paying only the minimum payment month after month; * Being out of cash constantly; * Being late on important payments, such as rent or mortgage; * Taking longer and longer to pay off balances; * Borrowing from one lender to pay another. Solving debt problems: * Talk with creditors -- hiding only makes the problem worse; * Don't charge more purchases until your problems are solved; * Avoid bankruptcy -- it's a short-term solution with long-term consequences; * Contact Consumer Credit Counseling Services at 800-388-2227. The ABA brings together all categories of banking institutions to best represent the interests of this rapidly changing industry. Its membership -- which includes community, regional and money center banks and holding companies, as well as savings associations, trust companies and savings banks makes ABA the largest banking trade association in the country. ABA can be found on the World Wide Web at aba.com . SOURCE American Bankers Association -0- 03/15/2001 /NOTE TO EDITORS: For additional information on the ABA Consumer Credit Delinquency Historical Fact Sheet, please contact Julie Malveaux, 202-663-5466, or go to aba.com /CONTACT: Julie Malveaux of the American Bankers Association, 202-663-5466/ /Web site: aba.com CO: American Bankers Association ST: District of Columbia IN: FIN CPR MLM SU: ECO * end of story *