Fewer U.S. consumers were late on their credit card payment in the second quarter, as a strong economy bolstered household balance sheets.
That’s according to a report from the American Bankers Association, which surveys banks on a quarterly basis to track seasonally adjusted trends in consumer delinquency rates.
During the second quarter, 2.93% of credit card customers at banks were at least 30 days late, according to the report. The late-payment rate during the first three months of the year was 3.06%.
“Overall, consumer financial health has been excellent,” James Chessen, the ABA’s chief economist, said in a press release. “Jobs are plentiful, wages are rising and savings rates have held steady at elevated levels, which paints a vivid picture conducive to low delinquencies.”
After the financial crisis, credit card issuers purged large numbers of bad loans, and the industrywide late-payment rate fell to unusually low levels. More recently, it has started to climb.
In the first quarter of 2018, the 30-day delinquency rate reached its highest level in six years, according to ABA data. But even at its most recent peak, the credit card late-payment rate remained well below its 15-year average of 3.55%.
The performance of other consumer loan types was mixed in the second quarter.
For personal loans and auto loans arranged directly through banks, delinquency rates declined.
Late payments rose for home equity loans and home equity lines of credit, but they remained well below the levels they hit between 2012 and 2014.
“Despite the upward blip in home equity delinquencies this quarter, the trend continues in the right direction,” Chessen said.
