Delinquency and Default Decline Nearly Across the Board

Five of the nation’s six largest credit card lenders reported that they had to write off fewer defaulted accounts as being uncollectable in June, while only one of them saw delinquency increase, and that was by a miniscule amount, according to a report from the Associated Press. Currently, all but Citibank have reported their monthly credit card business performance to the government.

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Bank of America saw defaults decline by the largest proportion, though both JPMorgan Chase and Discover Financial Services also enjoyed significant improvements, the report said. Meanwhile, the only lender to see the number of accounts that were 30 days or more behind increase was Capital One Financial.

As a result of fewer delinquent and defaulted accounts over the last several months, all of the top six lenders have seen profits increase significantly as they had to set less money aside to cover lost debts, the report said.

However, many financial experts say that past defaults are the cause for the repeated drops in both delinquency and default – in essence, lenders have artificially created a healthier credit environment by restricting access to accounts for those who have had trouble paying their bills in the past.

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