The number of charge offs seen industrywide in November fell to a rate of 8.58 percent of all accounts, down from 8.79 percent in October, according to the latest monthly report from Moody’s Investors Service. That’s nearly 19 percent lower than the rate in the same month last year, and down from the peak of 11.5 percent observed in August 2009.
Meanwhile, early-stage delinquencies – accounts that are 30 days behind and viewed as indicators of future charge offs – fell to 4.38 percent in November, the report said. That was the lowest rate for this type of delinquency since December 2007. Even later delinquencies, those 30 to 59 days behind, fell to 1.14 percent, which approached an all-time low.
Despite these declines, some lenders had more problems with defaults than others, the report said. Charge offs actually increased for JPMorgan and Capital One even as they fell for the other four major national lenders. Delinquencies, however, declined across the board.
In the past, rates of delinquency and default moved more or less in line with that of the national unemployment rate. However, recent months have seen these figures decouple, and some economists believe they may not meet again any time soon.