HEDGEYE CARD ROUND UP: DEC CREDIT IMPROVEMENT PART DENOMINATOR, PART CLAIMS

Credit Trends Improve in December

December monthly credit data released today showed ongoing credit quality improvement among the six big issuers. The average issuer saw delinquencies improve 11 bp in December, with 4 of the 6 issuers saw delinquencies decline by 10 basis points or more. Citigroup saw the largest sequential decrease in its delinquency rate, falling 17 bp to 3.11% On a 4Q vs. 3Q basis, all issuers improved except for Capital One, which posted a 2 bp increase in delinquencies. On the net charge-off front, the average issuer showed 21 bp of improvement in December with the 4Q vs 3Q improvement coming in at 35 bps, on average. Capital One was the only issuer to have net charge offs rise in 4Q vs. 3Q (by 15 bps).

 

The improvement in credit quality for the month of December is attributable to two factors. First, there was a significant denominator effect this quarter, the first in a long time. Second, the economy is providing a tailwind as jobless claims have been improving throughout 4Q11. Both of these factors could persist over the intermediate term.  

 

HEDGEYE CARD ROUND UP: DEC CREDIT IMPROVEMENT PART DENOMINATOR, PART CLAIMS  - TABLES  5  

 

HEDGEYE CARD ROUND UP: DEC CREDIT IMPROVEMENT PART DENOMINATOR, PART CLAIMS  - CCMT avg for top 6 issuers

 

 HEDGEYE CARD ROUND UP: DEC CREDIT IMPROVEMENT PART DENOMINATOR, PART CLAIMS  - All DQ

 

 HEDGEYE CARD ROUND UP: DEC CREDIT IMPROVEMENT PART DENOMINATOR, PART CLAIMS  - All NCO

 

 HEDGEYE CARD ROUND UP: DEC CREDIT IMPROVEMENT PART DENOMINATOR, PART CLAIMS  - AXP nco dqcy

 

 HEDGEYE CARD ROUND UP: DEC CREDIT IMPROVEMENT PART DENOMINATOR, PART CLAIMS  - BAC nco and dqcy

 

 HEDGEYE CARD ROUND UP: DEC CREDIT IMPROVEMENT PART DENOMINATOR, PART CLAIMS  - C nco and dqcy

 

 HEDGEYE CARD ROUND UP: DEC CREDIT IMPROVEMENT PART DENOMINATOR, PART CLAIMS  - JPM nco and dqcy

 

The charts below show our macro team's quantitative levels for the six major issuers. 


 HEDGEYE CARD ROUND UP: DEC CREDIT IMPROVEMENT PART DENOMINATOR, PART CLAIMS  - AXP macro chart

 

 HEDGEYE CARD ROUND UP: DEC CREDIT IMPROVEMENT PART DENOMINATOR, PART CLAIMS  - BAC macro chart 2

 

 HEDGEYE CARD ROUND UP: DEC CREDIT IMPROVEMENT PART DENOMINATOR, PART CLAIMS  - C macro chart

 

 HEDGEYE CARD ROUND UP: DEC CREDIT IMPROVEMENT PART DENOMINATOR, PART CLAIMS  - COF macro chart

 

 HEDGEYE CARD ROUND UP: DEC CREDIT IMPROVEMENT PART DENOMINATOR, PART CLAIMS  - DFS MACRO CHART

 

HEDGEYE CARD ROUND UP: DEC CREDIT IMPROVEMENT PART DENOMINATOR, PART CLAIMS  - JPM macro chart

 

Joshua Steiner, CFA

 

Allison Kaptur

 

Robert Belsky

 

Having trouble viewing the charts in this email?  Please click the link at the bottom of the note to view in your browser.  


Did the US Economy Just “Collapse”? "Worst Personal Spending Since 2009"?

This is a brief note written by Hedgeye U.S. Macro analyst Christian Drake on 4/28 dispelling media reporting that “US GDP collapses to 0.7%, the lowest number in three years with the worst personal spending since 2009.”

read more

7 Tweets Summing Up What You Need to Know About Today's GDP Report

"There's a tremendous opportunity to educate people in our profession on how GDP is stated and projected," Hedgeye CEO Keith McCullough wrote today. Here's everything you need to know about today's GDP report.

read more

Cartoon of the Day: Crash Test Bear

In the past six months, U.S. stock indices are up between +12% and +18%.

read more

GOLD: A Deep Dive on What’s Next with a Top Commodities Strategist

“If you saved in gold over the past 20 to 25 years rather than any currency anywhere in the world, gold has outperformed all these currencies,” says Stefan Wieler, Vice President of Goldmoney in this edition of Real Conversations.

read more

Exact Sciences Up +24% This Week... What's Next? | $EXAS

We remain long Exact Sciences in the Hedgeye Healthcare Position Monitor.

read more

Inside the Atlanta Fed's Flawed GDP Tracker

"The Atlanta Fed’s GDPNowcast model, while useful at amalgamating investor consensus on one singular GDP estimate for any given quarter, is certainly not the end-all-be-all of forecasting U.S. GDP," writes Hedgeye Senior Macro analyst Darius Dale.

read more

Cartoon of the Day: Acrophobia

"Most people who are making a ton of money right now are focused on growth companies seeing accelerations," Hedgeye CEO Keith McCullough wrote in today's Early Look. "That’s what happens in Quad 1."

read more

People's Bank of China Spins China’s Bad-Loan Data

PBoC Deputy Governor Yi says China's non-performing loan problem has “pretty much stabilized." "Yi is spinning. China’s bad-debt problem remains serious," write Benn Steil and Emma Smith, Council on Foreign Relations.

read more

UnderArmour: 'I Am Much More Bearish Than I Was 3 Hours Ago'

“The consumer has a short memory.” Yes, Plank actually said this," writes Hedgeye Retail analyst Brian McGough. "Last time I heard such arrogance was Ron Johnson."

read more

Buffalo Wild Wings: Complacency & Lack of Leadership (by Howard Penney)

"Buffalo Wild Wings has been plagued by complacency and a continued lack of adequate leadership," writes Hedgeye Restaurants analyst Howard Penney.

read more

Todd Jordan on Las Vegas Sands Earnings

"The quarter actually beat lowered expectations. Overall, the mass segment performed well although base mass lagging is a concern," writes Hedgeye Gaming, Lodging & Leisure analyst Todd Jordan on Las Vegas Sands.

read more

An Update on Defense Spending by Lt. Gen Emo Gardner

"Congress' FY17 omnibus appropriation will fully fund the Pentagon's original budget request plus $15B of its $30B supplemental request," writes Hedgeye Potomac Defense Policy analyst Lt. Gen Emerson "Emo" Gardner USMC Ret.

read more