The average charge-off rate among the top four U.S. Visa and MasterCard issuers jumped 15 basis points (bps) in the fourth quarter after plunging to record lows most of 2014. Capital One (COF) Q/4 charge-offs soared 56 bps sequentially.
The average U.S. charge-off rate in the fourth quarter (Q4/14), among the top four issuers, increased to 2.98%, from 2.83% in the prior quarter, but down 36 bps from one-year ago ratio of 3.34%. According to CardData, charge-offs rose for Chase and COF, driving the increase.
U.S. Charge-Offs Historical
Big 4 Average
Chase (JPM), the nation’s leading issuer and the #1 Visa issuer,
reported Q4 charge-offs of 2.69% were down 17 bps Y/Y, but up 17 bps from Q3/14.
Bank of America (BofA) posted Q4 bank credit card charge-offs dropped 48 bps from the year ago quarter to 2.74%. Sequentially, charge-offs declined 5 bps.
Capital One (COF) reported Q4 charge-offs of 3.39%, compared to 2.83% in the prior quarter an 3.89% one-year ago.
Citibank reported Q4 charge-offs, as a percentage of average loans, continued to decline to 3.10% for Q4/14, down 6 bps sequentially and 32 bps Y/Y.
RAM Research projects the U.S. bank credit card charge-off ratio among the Big 4 issuers will increase 20 bps in the first quarter.
For additional data on Credit Card Charge-Offs visit CardData®. For historical news and commentary on Credit Card Charge-Offs visit the searchable CardFlash® Library of more than 58,000 articles published since 1995. RAM Research® forecasts on Credit Card Charge-Offs are available exclusively through CardWeb.