Barclays on Financial Services: October Credit Card Trust Data Preview
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Rating Summary:
19 Buy, 20 Hold, 4 Sell
Rating Trend: = Flat
Today's Overall Ratings:
Up: 18 | Down: 23 | New: 10
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Barclays on Financial Services: October Credit Card Trust Data Preview
Analyst, Mark C. DeVries, said, "On Tuesday, credit card issuers will report master trust data for October, which we expect to reveal continued improvements in NCOs at each of the top six issuers (AXP, BAC, C, COF, DFS and JPM) and a 50 bp increase in NCOs for ADS based on our roll-rate analysis. For delinquencies, we expect relatively flat trends for most issuers as October is among the seasonally weaker months (+5 bps m-o-m increase), and recent credit data has begun to trend more closely with seasonal patterns. Based on the Fed's H.8 data, credit card loans declined 33 bps from September to October, and we would expect trust receivables to be flat to slightly down for most issuers."
Our estimates for each issuer's October delinquencies and NCOs are:
AmExp (NYSE: AXP): NCOs - managed up 10 bps to 2.4%, trust down 11 bps to 2.47%. Delinquencies - managed up 3 bps to 1.58% (1.6% rounded), trust up 3 bps to 1.69%.
BofA (NYSE: BAC): NCOs down 23 bps to 5.76%; delinquencies down 2 bps to 3.97%
Citi (NYSE: C): NCOs down 35 bps to 5.52%; delinquencies down 1 bp to 3.29%.
Capital One (NYSE: COF): NCOs - managed U.S. card down 7 bps to 3.83%, trust down 6 bps to 3.48%. Delinquencies - managed U.S. card up 2 bps to 3.67%, trust up 2 bps to 3.39%.
Discover Financial (NYSE: DFS): NCOs down 14 bps to 3.03%; delinquencies down 1 bp to 2.49%
JPMorgan (NYSE: JPM): NCOs down 7 bps to 4.06%; delinquencies up 1 bp to 2.54%
Alliance Data (NYSE: ADS): NCOs - managed up 50 bps to 6.4%. Delinquencies - managed down 20 bps to 4.7%
Analyst, Mark C. DeVries, said, "On Tuesday, credit card issuers will report master trust data for October, which we expect to reveal continued improvements in NCOs at each of the top six issuers (AXP, BAC, C, COF, DFS and JPM) and a 50 bp increase in NCOs for ADS based on our roll-rate analysis. For delinquencies, we expect relatively flat trends for most issuers as October is among the seasonally weaker months (+5 bps m-o-m increase), and recent credit data has begun to trend more closely with seasonal patterns. Based on the Fed's H.8 data, credit card loans declined 33 bps from September to October, and we would expect trust receivables to be flat to slightly down for most issuers."
Our estimates for each issuer's October delinquencies and NCOs are:
AmExp (NYSE: AXP): NCOs - managed up 10 bps to 2.4%, trust down 11 bps to 2.47%. Delinquencies - managed up 3 bps to 1.58% (1.6% rounded), trust up 3 bps to 1.69%.
BofA (NYSE: BAC): NCOs down 23 bps to 5.76%; delinquencies down 2 bps to 3.97%
Citi (NYSE: C): NCOs down 35 bps to 5.52%; delinquencies down 1 bp to 3.29%.
Capital One (NYSE: COF): NCOs - managed U.S. card down 7 bps to 3.83%, trust down 6 bps to 3.48%. Delinquencies - managed U.S. card up 2 bps to 3.67%, trust up 2 bps to 3.39%.
Discover Financial (NYSE: DFS): NCOs down 14 bps to 3.03%; delinquencies down 1 bp to 2.49%
JPMorgan (NYSE: JPM): NCOs down 7 bps to 4.06%; delinquencies up 1 bp to 2.54%
Alliance Data (NYSE: ADS): NCOs - managed up 50 bps to 6.4%. Delinquencies - managed down 20 bps to 4.7%
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