‘Disciplined Consumers’ Drive Consumer Credit Levels Up 33 Percent

ATLANTA, Dec. 26, 2012   /PRNewswire/ — According to Equifax’s latest National Consumer Credit Trends Report, consumer credit originated year-to-date through September 2012 has increased nearly 30% to $675 billion from $523 billion during the same timeframe in 2010. Comparatively, credit originations today are below the 2006-2007 pre-recession levels of about $1 trillion by about one-third.

Of note, balances on consumer credit originated over the past two years represents about 32% of outstanding balances, but only comprises slightly less than 6% of total delinquent balances, reflecting better underwriting and more responsible consumer payment behavior. In turn, consumer finance write offs have declined more than 53% to $70.9 billion year-to-date through November 2012, after peaking at $151.8 billion during the same timeframe in 2009.

“Consumer spending is being supported by gradually opening credit markets, with higher new limits on accounts, a gradual upward trend in non-mortgage consumer debt outstanding, and also consistently low utilization rates,” said Equifax Chief Economist Amy Crews Cutts. “Meanwhile, consumer finance delinquency rates, not including home loans, have returned to pre-recession levels — all signs that the consumer-led recovery is gaining strength heading into 2013.”

Auto Lending

•  Auto loans originated year-to-date through September 2012 totaled 16.4 million – an increase of more than 11% from same time a year ago and a five-year high.

•  At more than 58 million through November 2012, the total number of outstanding loans is at its highest level in 37 months.

•  Similarly, auto loan balances continue rising – through November 2012, balances totaled $775.7 billion, a 45-month high.

•  Auto loan amounts originated year-to-date through September 2012 ($318.2 billion) are more than 33% higher than the recession low for same time in 2009 ($210.2 billion).

Retail Credit Card

•  Total retail credit card limits are at more than $345 billion through November 2012, the highest level in 30 months.

•  Retail credit card originations year-to-date through September 2012 totaled $25.6 million, a four-year high (2009, 23.9 million).

•  New retail credit card origination credit limits year-to-date through September 2012 totaled $47.5 billion, a more than 17% increase from $39.4 billion in 2010.

Bank Credit Card

•  Total bank credit card limits opened year-to-date through September 2012 have increased nearly 44% from their recession low, from $87.8 billion in 2010 to $132.2 billion in 2012.

•  New bankcard accounts year to date through September 2012 totaled 29 million, the highest for that same time period since 2008 (43.5 million).

•  Write off rates for November 2012 reflected a 20% decrease from same time a year ago.

•  Utilization rates have remained at less than 22.5% throughout 2012, while the total number of bank credit card accounts has maintained a level of more than 300 million since September 2012.