Monthly Payment Rates Slip a Bit in Sept

Monthly payment rates continued to remain healthy despite a challenged economy. MPR, or the amount that cardholders pay on their credit card debt each month, slipped to nearly 18.86% in September. The higher payment rates were driven by new minimum payment standards. According to CardData, the MPR declined to 18.30% in July, compared to 18.40% in the prior month and 20.46% one-year ago. While the dip historically has been seasonal, it appears that many borrowers are increasingly pressured by current economic factors. The combination of higher interest rates and a cooling off of the real estate market diminished the attractiveness of “cash out” refinancing activity in which many borrowers reduced their more expensive credit card debt by drawing on the equity in their home — either by refinancing their mortgages or by accessing their home equity lines of credit.

Sep 06: 20.02%
Oct 06: 20.83%
Nov 06: 20.01%
Dec 06: 19.70%
Jan 07: 19.88%
Feb 07: 18.79%
Mar 07: 18.21%
Apr 07: 18.04%
May 07: 19.01%
Jun 07: 18.40%
Jul 07: 18.30%
Aug 07: 18.99%
Sep 07: 18.86%
Source: CardData (

Verizon Business Implements PCI DSS

Verizon Business has successfully implemented the “Payment Card Industry Data Security Standard” into its two U.S. managed hosting smart centers and achieved compliance with the VISA “CISP” for its transaction services network. Verizon Business combines a protected network, managed hosting centers and professional services to help businesses to comply with the “PCI DSS” for storing, processing and transmitting credit card information. With the July acquisition of Cybertrust, Verizon Business complemented its existing capabilities in the retail and financial services space with a full suite of PCI-related services and products. The “Verizon Online Compliance Program for Payment Card Industry” tool offers multiple views that are customized for retailers, payment service providers and acquiring banks.

Credit Card Charge-Offs Set a New 07 High

Charge-offs headed north, hitting 4.81% in September to a new record for this year. This is the fourth consecutive month that credit card charge-offs have increased. There has been concerns that the mortgage meltdown may have spilled over into the general consumer finance market. During the third quarter Citi reported that charge-offs for bankcard and private label cards declined to 4.41% compared to 4.55% in the prior quarter and 4.26% one-year ago. BofA posted third quarter charge-offs of 4.86%, compared to 5.20% in the prior quarter and 4.18% one-year ago. Capital One reported that the net charge-off rate for U.S. credit cards was 4.13% for the third quarter, compared to 3.73% for the second quarter and 3.39% one-year ago.

Jan 07: 4.33%
Feb 07: 4.39%
Mar 07: 4.44%
Apr 07: 4.60%
May 07: 4.65%
Jun 07: 4.60%
Jul 07: 4.62%
Aug 07: 4.77%
Sep 07: 4.81%
Source: CardData (

GE Money Inks Wood-Mizer for the Cutting Edge Program

GE Money and IN-based Wood-Mizer have announced a multi-year agreement to provide revolving and installment financing through the “Cutting Edge” program, managed by GE Money’s Sales Finance unit. The financing programs will be offered for Wood-Mizer’s line of sawmills and Lastec articulating rotary mowers at more than 75 dealers nationwide. Both credit options provide a simple application and sales process with competitive rates and promotions and no prepayment penalties. Wood-Mizer is a manufacturer of portable band sawmills and offers an extensive line of mills covering a wide range of cutting capabilities.

Advanta’s Q3 Biz Card Outstandings Rise 34%

Business credit card specialist Advanta posted a 34% rise in managed outstandings during the third quarter to $6.21 billion. During the third quarter, the issuer opened more than 74,000 new business card accounts and ended the quarter with a record 1,294,273 gross accounts. Advanta’s Business Card unit earned net income of $22.1 million as compared to $22.2 million in the prior quarter. Transaction volume increased 16% to $3.6 billion during the third quarter. Charge-offs, on averaged managed receivables, increased from 3.48% in the second quarter to 3.87% for the third quarter and are higher than 3Q/06’s 3.41% figure. Over 30-day delinquencies on managed receivables rose 42 basis points to 3.15% from the prior quarter. Over 90-day delinquencies on managed receivables also rose by four basis points to 1.41%, compared to the second quarter of 2007. For complete details on Advanta’s third quarter performance, visit CardData ([][1]).

Period Card Loans
3Q/06: $4.65 billion
4Q/06: $5.21 billion
1Q/07: $5.59 billion
2Q/07: $5.99 billion
3Q/07: $6.21 billion
Source: CardData (


Citi’s International Card Q3 Revenues Up 88%

Citigroup reported that its international card business third quarter net income soared to a record $647 million. Revenues of $2.85 billion jumped 88%, primarily driven by higher purchase sales and average loans, up 37% and 52%, respectively, improved net interest margins, and a $729 million pre-tax gain on the sale of Redecard shares. Excluding the gain, revenues increased 40%. Credit card outstandings as of September 30th were $43.4 billion, up 54% year-on-year. Loan balances grew at a double-digit pace in Mexico, EMEA, Asia, and Latin America. The account base grew 16% year-on-year to 35.6 million compared to one-year ago. Purchase volume for the third quarter was $28.0 billion, a 37% increase year-on-year. Delinquency (90+ days) was dipped sequentially to 2.22%. Charge-offs were 5.62% compared to 4.22% in the prior quarter and 5.01% for the year ago quarter. For complete detail’s on Citigroup’s international cards performance, visit CardData ([][1]).

3Q/06: $287 million
4Q/06: $231 million
1Q/07: $388 million
2Q/07: $351 million
3Q/07: $647 million
Source: CardData (