The Durbin amendment has
The trend mirrors a tilt in the industry toward higher-credit-quality cardholders who
That means a bigger base of activity for interchange assessments,
Annualized interchange income for securitized accounts at Bank of America Corp. averaged 3.3% of receivables from October through December last year, compared with an average of 2.4% in the three months through December 2008.
The increase partially offset a decline in the yield produced by finance charges in the portfolio, which fell 2.4 percentage points to 12.7% over the same time.
Interchange yield likewise increased by 1.8 percentage points to 5.2% for securitized accounts at Capital One Financial Corp., and by 1 percentage point to 4.4% for securitized accounts at Discover Financial Services.
Meanwhile, finance charge yields have oscillated wildly at Capital One and Discover, finishing 2011 almost a percentage point lower for both than in late 2008.
American Express Co., Citigroup Inc. and JPMorgan Chase & Co. do not present interchange income separately in monthly securitization reports, but most of the nation’s credit card giants have posted numbers showing large increases in transaction volume as a multiple of loans.
Amex, which touts the fee-generating power of its focus on wealthy customers and has long outshone competitors in this measure, has extended its lead.
In the fourth quarter, transactions on its U.S. cards at an annual rate were 8.5 times the amount of its receivables, up from 5.9 times in the fourth quarter of 2008.
After Amex, Capital One, JPMorgan Chase and B of A made the biggest gains in transaction velocity. Citi lagged the rest of the Big Six, holding about flat at a multiple of 2.1. The comparisons are exaggerated by the violent decline in household consumption that took hold in late 2008.
Still, major issuers have said they believe changes in strategy and tactics they have instituted — including
Barring