Late payments on credit cards in the U.S. fell in May because most users decided to catch up with the payment of its debts, although still fragile economic recovery.
The fall in arrears for the fifth consecutive month anticipates a decline in bad debt portfolio in the coming months.
Capital One Financial Corp, Discover Financial Services, JPMorgan Chase & Co, American Express Co. and Bank of America reported Tuesday that its delinquency rate fell to the lowest level of 2010.
The credit card losses have declined from highs last year, which has helped banks to write-than-expected earnings in the first quarter.
Americans reduced their debt by 1.7 percent in 2009, its worst decline in decades, and have continued to cut its debt to an annual rate of 2.4 percent in the first quarter of 2010.
However, the high unemployment of 10 percent means that credit losses will remain high in the largest lenders in comparison with historical levels. (continue reading…)