National Credit Default Rates Reach New Post-Recession Low in April 2014 According to the S&P/Experian Consumer Credit Default Indices
All Five Cities Saw Default Rates Decrease in April 2014
NEW YORK, May 20, 2014 /PRNewswire/ -- Data through April 2014, released today by S&P Dow Jones Indices and Experian for the S&P/Experian Consumer Credit Default Indices, a comprehensive measure of changes in consumer credit defaults, showed decline in national default rates from the previous month. The national composite recorded its lowest post-recession rate; it posted 1.11% in April, the lowest default rate since June 2006. The auto loan rate of 0.92% is a new historic low beating out the previous low of 0.99% set last month. The first mortgage default rate continued its downward trend, recording 1.01% in April, the seventh consecutive month of decline and lowest level seen since July 2006. Both the bank card and second mortgage saw their default rates increase; the bank card rate was 2.84% and the second mortgage posted 0.63% in April 2014.
"The prospect for further gains in economic activity and consumer confidence is good as shown by the continuing decline in consumer credit default rates," says David M. Blitzer, Managing Director and Chairman of the Index Committee for S&P Dow Jones Indices. "Consumer default rates have stabilized at levels similar to those seen before the financial crisis. The national composite is nearing a historic low while the auto loan reached a historic low in April. Neither the one-month uptick in consumer price inflation nor the Federal Reserve's winding down of its bond buying threaten either consumer default rates or overall economic activity.
"All five cities saw default rate decreases for their second consecutive month. Dallas posted a default rate of 0.83%, a new historic low. New York experienced the largest downturn; it posted 1.19% in April, 18 basis points lower than last month's level. New York also recorded the largest decrease year-over-year; the 1.19% rate in April 2014 was down 59 basis points from the 1.78% rate in April 2013. Miami continues to maintain the highest default rate while Dallas has the lowest. All five cities – Chicago, Dallas, Los Angeles, Miami and New York – remain below default rates they posted a year ago."
The table below summarizes the April 2014 results for the S&P/Experian Credit Default Indices. These data are not seasonally adjusted and are not subject to revision.
S&P/Experian Consumer Credit Default Indices |
||||
Index |
April 2014 |
March 2014 |
April 2013 |
|
Composite |
1.11 |
1.20 |
1.42 |
|
First Mortgage |
1.01 |
1.13 |
1.31 |
|
Second Mortgage |
0.63 |
0.60 |
0.62 |
|
Bank Card |
2.84 |
2.73 |
3.61 |
|
Auto Loans |
0.92 |
0.99 |
1.07 |
|
Source: S&P/Experian Consumer Credit Default Indices |
The table below provides the S&P/Experian Consumer Default Composite Indices for the five MSAs:
Metropolitan |
April 2014 |
March 2014 |
April 2013 |
New York |
1.19 |
1.37 |
1.78 |
Chicago |
1.36 |
1.52 |
1.70 |
Dallas |
0.83 |
0.97 |
1.00 |
Los Angeles |
0.97 |
1.04 |
1.36 |
Miami |
1.98 |
2.07 |
2.21 |
Source: S&P/Experian Consumer Credit Default Indices |
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S&P Dow Jones Indices LLC, a part of McGraw Hill Financial, is the world's largest, global resource for index-based concepts, data and research. Home to iconic financial market indicators, such as the S&P 500® and the Dow Jones Industrial Average™, S&P Dow Jones Indices LLC has over 115 years of experience constructing innovative and transparent solutions that fulfill the needs of investors. More assets are invested in products based upon our indices than any other provider in the world. With over 1,000,000 indices covering a wide range of asset classes across the globe, S&P Dow Jones Indices LLC defines the way investors measure and trade the markets. To learn more about our company, please visit www.spdji.com.
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About Experian
Experian is the leading global information services company, providing data and analytical tools to clients around the world. The Group helps businesses to manage credit risk, prevent fraud, target marketing offers and automate decision making. Experian also helps individuals to check their credit report and credit score, and protect against identity theft.
Experian plc is listed on the London Stock Exchange (EXPN) and is a constituent of the FTSE 100 index. Total revenue for the year ended 31 March 2014 was US$4.8 billion. Experian employs approximately 16,000 people in 39 countries and has its corporate headquarters in Dublin, Ireland, with operational headquarters in Nottingham, UK; California, US; and Sao Paulo, Brazil.
For more information, visit http://www.experianplc.com.
For more information:
Dave Guarino
Communications
S&P Dow Jones Indices
[email protected]
(+1) 212-438-1471
David Blitzer
Managing Director and Chairman of the Index Committee
S&P Dow Jones Indices
[email protected]
(+1) 212-438-3907
Jordan Takeyama
Experian Public Relations
[email protected]
(+1) 714-830-7561
Jointly developed by S&P Dow Jones Indices LLC and Experian, the S&P/Experian Consumer Credit Default Indices are published on the third Tuesday of each month at 9:00 am ET. They are constructed to track the default experience of consumer balances in four key loan categories: auto, bankcard, first mortgage lien and second mortgage lien. The Indices are calculated based on data extracted from Experian's consumer credit database. This database is populated with individual consumer loan and payment data submitted by lenders to Experian every month. Experian's base of data contributors includes leading banks and mortgage companies, and covers approximately $11 trillion in outstanding loans sourced from 11,500 lenders.
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