Performance Report: Consumer Unsecured and Subprime Auto, June 2024

Consumer Unsecured and Subprime Auto performance continues to improve overall; credit card analysis by states shows pockets of distressed borrowers.

dv01 analyzed 30+ DQ by state for credit cards and auto loans using TransUnion data, focusing on YoY trends. Their data aligns with dv01’s own reporting, such as Florida’s declining credit performance, and includes a valuable metric: Average Excess Payment (“AEP”). AEP is an indicator of a consumer's ability to manage debt payment as it represents consumers who do not pay their credit card bills in full yet pay beyond the minimum required payment.

Quick Insights

• TransUnion Data: In a poor omen for future performance, Florida, Georgia, South Carolina, Arizona, Nevada, and Texas have seen substantially faster credit card balance growth relative to credit limits with very slow—and sometimes negative—AEP growth.

• Consumer Unsecured: Top Grades in late 2021/early 2022 vintages saw an increase in ROI for the first time in nearly a year, significantly decreasing any risks of possible declines.

• Subprime Auto: While May and June saw improved credit performance, the first half of the year typically sees stronger credit performance, so it remains to be seen whether the positive trends will carry into the rest of the year.