Bank of America Corp (NYSE: BAC) disclosed on Monday that the number of credit card balances that it wrote-off declined in the month of July, the fourth straight month in a row. The Charlotte-based bank also reported that late payments have dropped to their lowest point of the year, a sign that consumers may be going back to work and are better able to pay off their debt.
In a regulatory filing with the U.S. Securities and Exchange Commission, Bank of America Corp (NYSE: BAC) said that its charge-off rate fell from 11.98% in June to 11.39% in July. Credit card companies, including Bank of America, typically write-off loans after they are 180 days past due, at which point banks give up on collecting balances.
During the past year, banks have written off record number of credit card balances as consumers have struggled to make payments. During the first quarter of the year, the overall charge-off rate was nearly 10% of balances, compared to a 3.8% during the second quarter of 2007 before the recession set in.
Bank of America Corporation is a bank holding company, and a financial holding company. The Company is a financial institution, serving individual consumers, small and middle market businesses, large corporations and governments with a range of banking, investing, asset management and other financial and risk management products and services. Through its banking subsidiaries (the Banks) and various nonbanking subsidiaries throughout the United States and in selected international markets, it provides a range of banking and nonbanking financial services and products through six business segments: Deposits, Global Card Services, Home Loans & Insurance, Global Banking, Global Markets, Global Wealth & Investment Management (GWIM), with the remaining operations recorded in All Other. On January 1, 2009, the Company completed the acquisition of Merrill Lynch.
Shares of Bank of America Corp (NYSE: BAC) fell by 0.30% on Monday, ending at $13.19.
