Banks and consumers brace for new credit card rules

With the U.S. economy in recession, the market that trades in credit card asset-backed securities faces increasing stress as more consumers fall behind on payments.

As delinquencies and charge-offs -- balances written off as uncollectible -- on credit cards rise, investors demand higher yield spreads for credit card-backed securities.

The ABA represents the biggest issuers of Visa and MasterCard. Citigroup, Bank of America and JPMorgan Chase enjoyed almost 70 percent of the credit card market at the end of 2007, according to the Card Industry Directory.

(Reporting by John Poirier; Editing by Vicki Allen)