Capital One Financial Corp. (COF) said U.S. credit card defaults rose in May along with a 9.4% spike in jobless rates in the country.
The McLean, Virginia-based company said in a regulatory filing that in May its annual net charge-off rate, loans it believes won’t ever be repaid, rose to 9.41% from 8.56% in April. The 30-day delinquency rate however fell for a third straight month to 4.9% from 5.04%.
Capital One said the change in its accounting period to processes bankruptcies had improved its charge-off rate by 50 basis points. Excluding that effect, the annualized default rate would have been close to 10%.
The company that issues MasterCard (MA) and Visa (V) credit cards, is still performing better than larger peers like American Express (AXP), Citigroup Inc (C) which are likely to paint an even bleaker picture.
Shares of Capital One were down nearly 2% to $23.58 at noon on the New York Stock Exchange.
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