TEXT-Fitch UK credit card index Q3: asset performance improved further

Mon Nov 12, 2012 11:03am EST

Link to Fitch Ratings' Report: UK Credit Card Index Q312Nov 12 - Fitch Ratings has published its quarterly UK Credit Card Index
report - UK Credit Card Index.

Overall the performance of UK credit card trusts has improved in Q312, with
charge-off rates and delinquency rates decreasing even further from their
historic low level reached in Q212.

Given the decreasing delinquencies and signs of improvements in the UK economy,
the charge-off index is expected to stay stable or improve slightly in the
short-term. Yield and payment rates are expected to remain stable

Driven by a significant increase in the charge-off rate reported by CARDS II for
September, the value for September 2012 increased by 1.2 percentage points to
6.7%. The three-months rolling charge-off index however improved to 5.8% in Q312
from 6.0% in Q212. The three-months rolling 60-180 Day Delinquency Index
decreased to 1.9% in Q312 from 2.1% the quarter before, testing its lowest level
seen since index inception in 2002.

The Fitch Gross Yield Index value for September 2012 was 21.0%, representing a
quarter-on-quarter increase of 1.6%. The Fitch Monthly Payment Rate Index
remained stable to 17.2% within the corridor of 16.0%-19.0% as it has broadly
been in the past 10 years.

Fitch's outlook for UK credit card transactions is stable, reflecting among
other factors, the down-trend in delinquencies, high-but-stable unemployment
levels and flattening personal insolvencies in the UK.

The Penarth trust removed GBP403m of principal receivables in October and added
a pool of around GBP650m of principal balances from an eligible pool of Lloyds
TSB receivables. Barclays added 105,000 accounts into the Gracechurch trust to
increase the collateral balance by GBP422m.

The only issuance out of the Fitch-rated trusts in Q312 was the GBP1.3bn
retained issuance from the Arran trust of RBS. Overall the index composition did
not change over the past quarter and the value of collateral tracked by the
Index remained stable at GBP27bn at the end of Q312.

The full report, entitled Credit Card Index - UK - Q3 2012, is available at
www.fitchratings.com.

Additional information is available at www.fitchratings.com.
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