ADS - Alliance Data Systems December card charge-off rate rises delinquency falls

Alliance Data Systems (ADS) Card Services segment's net charge-off rate jumps to 8.7% in December vs. 5.2% in November and 6.1% in December 2019.Delinquency rate, meanwhile, declined to 4.4% as of Dec. 31, 2020 from 5.0% in November and 5.8% at Dec. 31, 2019.ADS said its consumer relief program caused timing-related volatility in its monthly loss rate. It expects Q1 losses to be in the range of H2 2020 average loss rate of ~6%.As ADS points out in its statement, accounts receiving forbearance relief may not advance to the next delinquency cycle, including eventually to charge-off, in the same timeframe that would have occurred had the forbearance relief not been granted.Its COVID-related customer relief program represented 3% of total card receivables as of Dec. 31, 2020, the company said in its SEC filing (slide 26 in presentation).

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Alliance Data Systems December card charge-off rate rises, delinquency falls