After four straight months of drops, one of the major U.S. lenders reported that it wrote off more toxic credit card debt in August.
In its monthly regulatory filing, Capital One said its rate of charge offs – credit card debts so far behind that the company deems them uncollectable – increased in August for the first time in months, a new report from Reuters said. In all, defaults jumped slightly from 8.13 percent of all accounts in July to 8.19 percent in August.
On the other hand, Capital One, whose filings are typically the first to come out every month, also said its delinquencies continued to decline in August, the report noted. Delinquent credit card debt – accounts 30 or more days behind – fell from 4.66 percent in July to 4.56 percent.
An increase in charge offs may indicate that consumers who were already experiencing financial problems continued to struggle when attempting to pay off their credit card debt in August. Almost all the other major lenders had previously seen declines in seriously delinquent accounts in recent months.