NEW YORK,
June 20, 2017 /PRNewswire/ --
S&P Dow Jones Indices and Experian released today data through
May 2017 for the S&P/Experian
Consumer Credit Default Indices. The indices represent a
comprehensive measure of changes in consumer credit defaults and
show that the composite rate dropped four basis points from last
month to 0.86%. In addition, the bank card default rate increased
18 basis points from April to 3.53%, auto loan defaults decreased
five basis points from the previous month to 0.85%, and the first
mortgage default rate dropped five basis points from April to
0.64%.
Four of the five major cities saw their default rates
decrease in the month of May. New
York experienced the largest decrease, down nine basis
points from April to 1.01%. Los
Angeles reported 0.66% for May, dropping three basis points
from the previous month. Dallas
came in at 0.67%, down two basis points from April. Miami was down one basis point from April to
1.29%. At 0.97%, Chicago was the
only city reporting a default rate increase of three basis points
from the previous month.
The National bank card default rate of 3.53% in May set a
48-month high. When comparing the bank card default rate among the
four census divisions, the default rate in the South is
considerably higher than the other three census divisions. The East
South Central Census Region – comprised of Kentucky, Tennessee, Alabama, and Mississippi – has the highest bank card
default rate. As per the Bureau of Labor Statistics, these states
have some of the lowest median household
income.
"Easy come, easy go: bank cards where borrowing money
requires simply swiping a credit card are experiencing rising
defaults, while defaults on other kinds of consumer credit which
depend on paperwork are flat or down," says David M. Blitzer,
Managing Director & Chairman of the Index Committee at S&P
Dow Jones Indices. "Default rates on bank cards are at the highest
level since May 2013, four years ago.
In the past, default rates began to climb around the same time the
growth of bank card credit outstanding began to slow. The
year-over-year growth of bank card credit outstanding peaked at
6.8% last November and was at 5.7% in April, the latest figure
available. Bank card defaults rose from 2.81% in November to 3.35%
in April, and up to 3.53% in May.
"The pictures of auto loans and mortgages are quite
different. Default rates for auto loans have drifted down in the
last four months. At the beginning of the year there were reports
of a sub-prime crisis in auto loans; these concerns seem to be
behind us. The default rate on first mortgage remains at 1%, lower
than the pre-crisis period. Rising home prices and increases in the
equity mortgage borrowers have in their home are helping lower
default rates. One factor in the difference between rising bank
card defaults and stable defaults on mortgages and autos may be the
difference in interest rates: about 4% on mortgages and 4.4% on
auto loans, compared to 12%-18% on bank card loans."
The table below summarizes the May
2017 results for the S&P/Experian Credit Default
Indices. These data are not seasonally adjusted and are not subject
to revision.
S&P/Experian Consumer Credit Default
Indices
|
|
National Indices
|
|
Index
|
May 2017
Index
Level
|
April 2017
Index
Level
|
May 2016
Index
Level
|
|
|
Composite
|
0.86
|
0.90
|
0.81
|
|
First Mortgage
|
0.64
|
0.69
|
0.63
|
|
Second Mortgage
|
0.54
|
0.51
|
0.51
|
|
Bank Card
|
3.53
|
3.35
|
3.11
|
|
Auto Loans
|
0.85
|
0.90
|
0.92
|
|
Source: S&P/Experian Consumer Credit Default
Indices
|
|
|
Data through May 2017
|
|
|
|
|
|
|
|
|
The table below provides the S&P/Experian Consumer
Default Composite Indices for the five MSAs:
Metropolitan
Statistical Area
|
May 2017
Index
Level
|
April 2017
Index
Level
|
May 2016
Index
Level
|
|
|
New York
|
1.01
|
1.10
|
0.89
|
|
Chicago
|
0.97
|
0.94
|
0.98
|
|
Dallas
|
0.67
|
0.69
|
0.69
|
|
Los Angeles
|
0.66
|
0.69
|
0.67
|
|
Miami
|
1.29
|
1.30
|
1.27
|
|
Source: S&P/Experian Consumer Credit Default
Indices
|
|
|
Data through May 2017
|
|
|
|
For more information about S&P Dow Jones Indices,
please visit www.spdji.com.
ABOUT THE S&P/EXPERIAN CONSUMER CREDIT
DEFAULT INDICES
Jointly developed by S&P Dow Jones Indices LLC and
Experian, the S&P/Experian Consumer Credit Default Indices are
published on the third Tuesday of each month at 9:00 am ET. They are constructed to track the
default experience of consumer balances in four key loan
categories: auto, bankcard, first mortgage lien and second mortgage
lien. The Indices are calculated based on data extracted from
Experian's consumer credit database. This database is populated
with individual consumer loan and payment data submitted by lenders
to Experian every month. Experian's base of data contributors
includes leading banks and mortgage companies, and covers
approximately $11 trillion in
outstanding loans sourced from 11,500 lenders.
For more information, please visit:
www.consumercreditindices.standardandpoors.com.
ABOUT S&P DOW JONES
INDICES
S&P Dow Jones Indices is the largest global resource
for essential index-based concepts, data and research, and home to
iconic financial market indicators, such as the S&P
500® and the Dow Jones Industrial Average®.
More assets are invested in products based on our indices than
based on any other provider in the world. With over 1,000,000
indices and more than 120 years of experience constructing
innovative and transparent solutions, S&P Dow Jones Indices
defines the way investors measure and trade the markets.
S&P Dow Jones Indices is a division of S&P Global
(NYSE: SPGI), which provides essential intelligence for
individuals, companies, and governments to make decisions with
confidence. For more information, visit
www.spdji.com.
ABOUT EXPERIAN
We are the leading global information services company,
providing data and analytical tools to our clients around the
world. We help businesses to manage credit risk, prevent fraud,
target marketing offers and automate decision making. We also help
people to check their credit report and credit score and protect
against identity theft. In 2015, we were named one
of the "World's Most Innovative Companies" by Forbes
magazine.
We employ approximately 17,000 people in 37 countries and
our corporate headquarters are in Dublin,
Ireland, with operational headquarters in Nottingham, UK; California, US; and São Paulo, Brazil.
Experian plc is listed on the London Stock Exchange (EXPN)
and is a constituent of the FTSE 100 index. Total revenue for the
year ended March 31, 2016, was
US$4.6 billion.
To find out more about our company, please visit
http://www.experianplc.com or watch our
documentary, "Inside
Experian."
Experian and the Experian marks used herein are trademarks
or registered trademarks of Experian Information Solutions, Inc.
Other product and company names mentioned herein are the property
of their respective owners.
FOR MORE INFORMATION:
David Blitzer
Managing Director
and Chairman of Index Committee
New York, USA
(+1) 212 438
3907
david.blitzer@spglobal.com
Luke Shane
North America Communications
New York, USA
(+1) 212 438 8184
luke.shane@spglobal.com
Matt Tatham
Experian Public Relations
(+1) 917 446
7227
matt.tatham@experian.com
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SOURCE S&P Dow Jones Indices