U.S. Card Issuers: Continued Improvement in Credit Performance and Solid Credit Card Spending in Q1 2025, but Will It Persist?

This commentary reviews key trends from the Q1 2025 results of the top six general purpose credit card issuers in the U.S.

Key highlights include:

-- For the top six general purpose credit card issuers, credit card spending growth decelerated to 4% YOY in Q1 2025 from 6% in Q4 2024. Spending trends in April showed early signs of accelerating growth.
-- The 30+ day delinquency rate for the peer group was 2.8% at March 31, 2025, down 8 bps YOY, marking the first YOY decline after rising YOY for 11 consecutive quarters. The net charge-off rate recorded the smallest YOY increase since Q3 2022.
-- In Q1 2025, credit card balances grew 5% YOY, in line with the average growth rate registered in 2019 and consistent with our expectations.

"Credit card spending was resilient in Q1 2025 as indicated by the operating results for the six largest general-purpose credit card issuers in the U.S. and the major payment networks, while credit performance metrics showed continued signs of stabilization with a modest year-over-year improvement in delinquencies." said Yanni Koulouriotis, CFA, Senior Vice President - North American Financial Institution Ratings. "It remains to be seen whether the recent decline in consumer sentiment indicators along with softening economic conditions, will have a significant impact on cardholder spending and credit performance in the coming months."