According to a report by Chicago-based TransUnion, a credit and information management company, the delinquency rate in the US climbed 11% during the first quarter of 2009, compared to the same period a year ago.
Delinquency rates were highest in Nevada, followed by Florida and Arizona, where large numbers of homeowners are fighting with foreclosures.
Ezra Becker, Director of consulting and strategy in TransUnion’s financial-services group, said: “As expected, bank-card delinquencies increased in the first quarter. This increase could be an indication that tax-refund checks, typically used to pay down balances during the first quarter in years past, are now being used to cover daily living expenses.”
This can spell more trouble to the already beleaguered card issuers like Citigroup, Bank of America, American Express, Capital One Financial, Discover Financial Services and JPMorgan Chase.
The reporting agency expects the 90-day delinquency rate to continue to rise till the end of 2009, and depending on the impact of stimulus programs and unemployment, may hit peak in late 2010 or early 2011.
