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FDIC: Southeast falls furthest behind in credit card bills

Jeremy Simon

With its Quarterly Banking Profile for the final months of 2007, the Federal Deposit Insurance Corporation joined the chorus of those saying that loans, including those borrowed on credit cards, are increasingly going in the tank.
Where the FDIC provides extra insight, due to its ability to peer into the operations of so many banks across America, is in where credit card debt is tanking the most. It’s not evenly distributed.

For example, people in the Southeast have the largest amount of credit card debt that is between 30 and 90 days past due.

The FDIC divvied its data into six, somewhat oddly shaped regions: The Northeast (Connecticut, Delaware, Washington, D.C., Maine, Maryland, New Hampshire, New Jersey, New York, Pennsylvania and Puerto Rico); the Southeast (Alabama, Florida, Georgia, North Carolina, South Carolina, Virginia, West Virginia); the North Central (Illinois, Indiana, Kentucky, Michigan, Ohio, Wisconsin); the Midwest (Iowa, Kansas, Minnesota, Missouri, Nebraska, North Dakota, South Dakota); the Southwest (Arkansas, Colorado, Louisiana, Mississippi, New Mexico, Oklahoma, Tennessee, Texas); and the Far West (Alaska, Arizona, California, Hawaii, Idaho, Montana, Nevada, Oregon, Pacific Islands, Utah, Washington, Wyoming).

The differences were striking.

The Southeast’s 2.78 percent of past due credit card debt is more than twice the 1.21 percentage listed for the Southwest region — the area with the lowest amount of credit card debt past due.

The other regions fell somewhere in between. The Far West had the next-largest amount of unpaid credit card debt with 2.42 percent, while people in the Heartland had the second-best handle on their credit card debt: the North Central area reported 2.12 percent and the Midwest region posted 2.26 percent.

The Southwest also fared well when it came to credit card loans that are non-current (“past due 90 days or more or that are in non-accrual status”). That region had just 1.1 percent of non-current credit card loans. The worst area? The Far West. That area’s residents had 2.5 percent of noncurrent credit card debt. Nationally, noncurrent credit card loans advanced by $1.9 billion, or 26 percent.

Additionally, the Southwest reported the lowest portion of credit card loans charged off at 2.45 percent net year-to-date. Overall, the FDIC said that fourth-quarter credit card charge-offs rose $1 billion, or 33 percent, from the year before. That was less than the increase in charge-offs of other loans to individuals, which climbed $1.1 billion, or 58.4 percent.

Despite a recent tightening of lending standards by banks, the FDIC reports that credit card loans grew by $38 billion, or 9.9 percent, in the fourth quarter of last year.

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