CREDIT CARD DEFAULTS REACH RECORD HIGH IN APRIL

Posted on May 19, 2009. Filed under: Uncategorized |

U.S. credit card defaults rose in April to record highs, with Citigroup and Wells Fargo posting double digit loss rates, as the recession slashed more than 2 million jobs since the beginning of the year.

Citigroup (C) a big issuer of MasterCard cards—reported its annualized charge-off rate rose to 10.21 percent in April from 9.66 percent in March.

Wells Fargo (WFC) ] said its charge-off rate increased to 10.03 percent from 9.68 percent, while JPMorgan Chase (JPM) a big issuer of Visa (V) cards reported its charge-off rate rose to 8.07 percent from 7.13 percent in the previous month.

Discover Financial Services (DFS), the U.S. fourth-largest credit card network, said its default rate rose to 8.26 percent in April from 7.39 percent in March.



Credit card lenders are trying to protect themselves by tightening credit limits, raising standards and closing accounts. They have also been slashing rewards, increasing interest rates and boosting fees to cushion against further losses.

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