The NY Fed’s latest Household Debt and Credit Report shows card 90+ delinquencies approaching Great Recession levels. This was surprising to all of us at 2OS and concerning for several of our clients.
However, a key driver of the NY Fed’s 90+ day delinquency rate is the inclusion of charged-off balances in a 90+ delinquent calculation. This is different than how 2OS and banks report delinquencies, which exclude charged-off loans. When the charged-off loans are removed, the picture looks meaningfully different.
Our analysis shows that delinquencies excluding charge-offs are stable, though vintage-based monitoring does show fanning in recent origination cohorts. Check out the attached report for more details.
Curious what this means for your portfolio? We’d love to talk. Reach out to Dave Wasik, Walker Flythe, or Pallavi Vemuri to learn more.