Global Credit Trends
Executive Summary
Here are the top 3 trends across the globe from the 1st half of 2022:
Mortgage Debt
United States: Total mortgage debt continued to rise—9% YOY in March
Canada: Despite a decline in new mortgage volume, Canada’s mortgage debt grew by 9.2% YOY and 2.6% QOQ in Q2 2022
Australia: Mortgage debt will continue to be elevated as a result of the pandemic property boom
Non-Mortgage Debt
United States: Personal loan debt has increased significantly in the past year with total balances 17.6% higher YOY. This product now accounts for 3% of non-mortgage US debt, compared to 2.6% a year ago
Canada: Average non-mortgage debt per consumer is at $21,128 , an increase of 2.4% compared to Q2 2021
United Kingdom: Consumers paying off credit card debt throughout the pandemic, balances still at below 80% of Jan 2020 levels
Spain: Continued decrease in debt due to financial government support during pandemic period (Spain only reports defaulted assets)
Non-Mortgage: Includes Buy Now Pay Later, credit cards, installment loans, personal loans and automobile loans. Availability and coverage will vary by region.
Mortgage Inquiries
Canada: Non-mortgage credit demand is going up
Canada: Mortgage broker inquiries are slowing down but the demand is still higher than pre-pandemic
Mortgage Inquiries
Australia: AU mortgage demand approaching pre-pandemic levels, Q2 2022 fell 7% compared to the same quarter last year
New Zealand: Mortgage demand in NZ for the June quarter dropped by 37%, year on year. Despite the softening market, mortgage demand in the June quarter 2022 was still 8.6% higher than the same quarter in Q2 2019
Mortgage Inquiries
United Kingdom & Spain: Credit demand has now reached pre-pandemic levels (UK), at around 92% (ES) compared to 2019
UK Annual growth rate for all lending at 6.5% in March (12.5% for credit cards)
Non-Mortgage Inquiries
Argentina: After a high increase in the third quarter of 2021, demand of non-mortgage loans has stabilized in 2022 with bigger values for Q2 than Q1
Rising Card Delinquencies
Overall: Multiple regions are showing an uptick in credit card delinquency
Canada: Credit card utilization is increasing with high consumer spending. It is currently at 22.3%, up 8% from Q2 2021
Non-Mortgage Debt
United States: Bankcard utilization is increasing across all score tiers, however has not returned to pre-COVID levels
The most aggressive increase in credit limits is seen in subprime and nearprime, with a ~18% increase YOY in these segments
Canada: Average credit limit on new cards is up by 27% when compared to the same time period in 2021
Argentina: Credit limit increases didn't follow the inflation rate behavior, which can impact the utilization levels. Utilization levels are moving around 35% in the last 3 quarters
United States
Auto loans originated in April 2022 shows increased early delinquency after 3 months on book across subprime, near prime and prime loans
Consumer loans are exceeding pre-Covid delinquency levels. This is due to both score shift (increased subprime underwriting) as well as increased delinquency
Canada
Credit card and other non-mortgage products are starting to see a rise in account level 90+ delinquency rate
However, we are not seeing the same uptick in balance level delinquency rate as high debt levels are masking the delinquent balances
Australia & New Zealand
Cost of living stings AU as personal loan early delinquency (30+dpd) hit highest level since the pandemic at 3.13%
NZ delinquencies remain low and reasonably stable across all products
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