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Consumer Debt is Up; Delinquency Rate Hits New Low, According to Equifax Canada

TORONTO, ONTARIO -- (Marketwired) -- 09/04/14 -- While the average debt among Canadians increased when compared to the same quarter last year, the national delinquency rate reached its lowest level since 2008, according to Equifax Canada's Q2 2014 National Consumer Credit Trends Report.

The average debt held by Canadians, excluding mortgages, is $20,759. On average, outstanding balances on financial products increased by 1.5 per cent over the same period last year. As of Q2 2014, Canadian consumers owe $1,447.5 billion, compared to $1,422,1 billion in Q1 2014 and $1,350.6 billion in Q2 2013; an increase of 1.8 per cent and 7.2 per cent, respectively.

"Demand for new credit is up, but has slowed significantly versus the first quarter when we saw a spike in credit card activity," explained Regina Malina, Senior Director, Decision Insights, Equifax Canada. "Credit card balances of new cardholders continue to increase, while credit limits and new card issuance have slowed. This may be an indication that promotional activity of credit card issuers is slowing down."

Flying in the face of the debt numbers, the national 90+ day delinquency rate has been consistently decreasing over the past four years. In Q2 2014, it reached 1.11 per cent, the lowest level since 2008 and consumer bankruptcies declined by 5 per cent over the last 12 months.

On a debt classification basis, the installment loan and national credit card sectors are still showing significant increases of 10.8 per cent and 4.4 per cent year-over-year, respectively.

"For the most part, Canadians are working within their means to manage their debt effectively," added Malina. "When stacking the regions up against each other, it's clear that Alberta remains the biggest driver of new credit. Demand for new credit in the West has increased for five consecutive quarters."

REGIONAL DEMAND FOR NEW CREDIT



       ---------------------------------------------------------------------
                            % Changes - Year- over-Year
       ---------------------------------------------------------------------
                      2012 vs 2011                2013 vs 2012  2014 vs 2013
       ---------------------------------------------------------------------
           Q1     Q2     Q3     Q4     Q1     Q2     Q3     Q4     Q1     Q2
----------------------------------------------------------------------------
Ontario -1.1%  -3.0%  -1.8%  -2.5%  -4.5%   2.2%   2.6%  -1.3%   1.1%  -0.4%
----------------------------------------------------------------------------
Quebec   7.5%   6.7%   6.0%   2.7%  -5.8%   0.6%  -0.8%  -0.8%   1.9%  -0.5%
----------------------------------------------------------------------------
West     2.7%   0.2%  -2.2%  -3.7%  -4.8%   5.3%   7.3%   4.4%   6.5%   3.5%
----------------------------------------------------------------------------
East     2.0%   0.2%  -4.4%  -1.7%  -6.8%   2.1%   1.3%  -3.4%  -2.8%  -3.1%
----------------------------------------------------------------------------
Canada   2.6%   0.8%  -0.1%  -1.5%  -5.2%   2.6%   5.0%   0.4%   2.7%   0.6%
----------------------------------------------------------------------------

Click here for more information.

Data for this report, including scores, are sourced from the Equifax Canada data warehouse, which stores the majority of credit transactions that occur in Canada. There are over 25 million unique consumer files. Transaction volumes for data are estimated at 105 million per month. Information provided in this report was adjusted to ensure that quarterly data reflects the results as of the last month of each quarter.

About Equifax

Equifax is a global leader in consumer and commercial information solutions, providing businesses of all sizes and consumers with information they can trust. We organize and assimilate data on more than 600 million consumers and 81 million businesses worldwide, and use advanced analytics and proprietary technology to create and deliver customized insights that enrich both the performance of businesses and the lives of consumers.

Headquartered in Atlanta, Equifax operates or have investments in 19 countries and is a member of the Standard & Poor's (S&P) 500® Index. Its common stock is traded on the New York Stock Exchange under the symbol EFX.

For more information, please visit www.equifax.ca.

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