Delinquency Rates and Past Due Balances Decrease Across All Provinces; Outlook for Canada Improving Through 2010 -- TransUnion

Current Trend Is More Optimistic Than Consumer Perceptions

TransUnion released today the results of its analysis of trends in the credit card and automotive lending industry for the third quarter of 2010 for the Canadian market. The report is the first of a series of quarterly consumer lending sector analyses focusing on credit trends. Leveraging TransUnion's credit database, the information for this analysis is culled quarterly from anonymous credit files of all credit-active Canadian consumers, providing a real-life perspective on how they are managing their credit health.

3Q2010 -- National and Regional Statistics

  • The total active credit population in Canada is 24.8 million consumers, representing a 0.15 percent increase year over year. These credit active consumers carry, on average, household debt of $25,163, excluding mortgage. This represents an increase of 4.3 percent when compared to the third quarter of 2009.

  • Overall debt has continued to grow (4.3 percent year over year), but at a slower, single digit rate in the last three quarters.

  • Quebec posted the largest increase in overall debt at 6.6 percent to $102B; Manitoba had the lowest increase in overall debt at 2.6 percent ($14.6B).

  • Revolving Loans was the main driver in overall debt for the third quarter, up 17.5 percent, followed by Installment Loans at 8.3 percent. The third quarter of 2010 was the first time since the fourth quarter of 2008 where Lines of Credit (4.3 percent) did not lead the market. 

  • Major Delinquencies on all credit accounts (percentage of accounts 90-120 days past due) were down year over year, indexing at 88 versus Q3 2009. Derogatory accounts (percentage of accounts in Collection, Foreclosure, Repossession, Bankruptcy or Write-Off) remained high, indexing 124 year over year.
Market Analysis

"There continue to be positive signs in the credit market as Canadians slowly manage out of the recession. Overall debt continued to grow, but at more modest rate (4.3 percent) compared to the double digit increases pre-recession, and the number of accounts being held by Canadians has been rationalized down 10 percent (to 3 per person) over the past year and a half. The most positive sign has been the significant decrease in past due balances (outstanding debt that is at least 30 days past due) which has dropped 15 percent since last year after 3 years of increases." 

Thomas Higgins, TransUnion's vice president of analytics and decisioning 

3Q2010 -- Credit Card Statistics 

  • The national credit card delinquency rate (the ratio of credit card accounts 90 days or more delinquent) fell to 0.34 percent in the third quarter of 2010, down 7.8 percent over the previous quarter. Year over year, credit card delinquencies decreased 9.3 percent from 0.38 percent.

  • Prince Edward Island had the highest credit card delinquency rate at 0.61 percent while Quebec had the lowest (0.20 percent).

  • According to an EKOS survey(1) on perceptions of credit card delinquency rates, conducted on behalf of TransUnion, the majority of Canadians (61 percent) expected the third quarter delinquency rate to be higher than the previous year. This perception is opposite of the current trend, possibly indicating that Canadians are better managing their credit card debt than they believe.

  • Canadian average credit card borrower debt (defined as the aggregate balance on all credit cards for an individual bankcard borrower) increased for the third straight quarter to $3,709 from the previous quarter's $3,614, but was still down 1.7 percent compared to the third quarter of 2009 ($3,772).

  • Canadians' perceptions of credit card borrower debt, as measured in the same EKOS survey, are relatively accurate, with 74 percent believing that the national average credit card borrower debt increased through 2010, which is in line with TransUnion's third quarter statistics. However, of that 74 percent, the vast majority (87 percent) predicted an increase of $250 or more, considerably more than the actual increase of $95.

  • Penetration of credit cards with Canadian consumers increased for the second consecutive quarter to 81.3 percent after almost two years of sporadic declines, while the number of active credit cards declined (3.5 percent) for the fourth straight quarter. This resulted in the average Canadian credit card consumer having 1.75 cards in their wallet, down from a high of 1.9 in the first quarter of 2009.

Credit Card Analysis

"In the third quarter, Canadians are continuing to effectively manage their credit card debt post recession. While the overall debt carried on cards increased for the third straight quarter, we are seeing some positive signs in the drop in the number of delinquent accounts. Typically, credit card debt increases through the holiday shopping season. It will be interesting to see if consumers continue to amass more debt during this holiday season and if delinquencies rise in the first quarter of 2011 when holiday bills are due. In any event, credit card delinquency for the quarter remained well within historical norms and is not a cause for significant concern at this time."


Thomas Higgins, TransUnion's vice president of analytics and decisioning


3Q2010 Auto Statistics 

  • The Auto delinquency rate (the ratio of Auto accounts 90 days or more delinquent) held at 0.11 percent in the third quarter of 2010 versus the previous quarter, but is down noticeably from a year ago (0.15 percent).

  • Canadian auto borrower debt (defined as the aggregate balance on all auto loans for an individual auto borrower) increased for the third straight quarter to $16,183 from the previous quarter's $15,135, posting a 9.8 percent increase compared to the third quarter of 2009 ($14,736).

  • Year over year, auto loan credit limits have increased for the fourth consecutive quarter ($28,154), up 6.4 percent year over year. This represents the largest annual increase in over 3 years.  

Auto Debt Analysis

"The relatively steady auto delinquency rate underscores the importance Canadians see in maintaining a positive relationship with their auto lender. We have seen due to the decline in both auto and credit card delinquencies in the past quarters that having a reliable form of transportation and some liquidity in the form or credit cards were important to consumers. With the large suburban population and the high commuter rates throughout Canada, having an auto is a necessity. In addition, the rise in auto debt comes as no surprise as new loans came on the books due to the incentive offerings by automakers over the last couple of months." 

 Thomas Higgins, TransUnion's vice president of analytics and decisioning 

TransUnion's Market Trends

TransUnion's Market Trends is an in-depth, full sample solution that provides statistical information every quarter from TransUnion's national consumer credit database. Each Canadian consumer record contains hundreds of credit variables that illustrate consumer credit usage and performance. By leveraging Market Trends, customers from a variety of industries can analyze industry trends over an entire business cycle, helping to understand consumer behaviour in different geographic locations throughout Canada.  

About TransUnion

As a global leader in credit and information management, TransUnion creates advantages for millions of people around the world by gathering, analyzing and delivering information. For businesses, TransUnion helps improve efficiency, manage risk, reduce costs and increase revenue by delivering comprehensive data and advanced analytics and decisioning. For consumers, TransUnion provides the tools, resources and education to help manage their credit health and achieve their financial goals. Through these and other efforts, TransUnion is working to build stronger economies worldwide. Based in Toronto, with global headquarters located in Chicago, Illinois, TransUnion provides service and support throughout Canada. Visit to learn more.


Graphics and/or photographs to accompany this release can be obtained by members of the media by contacting Cliff O'Neal at 312-985-2540 or or Dave Blumberg at 312-985-3059 or


(1) EKOS survey of 1,259 Canadians ages 18 and over, completed November 15, 2010. The survey was conducted using EKOS random probability-based Probit online data collection platform. Results are valid within +/- 2.8 percentage points, 19 times out of 20.

Contact Information:
  Contact: Dave Blumberg TransUnion E-mail: Telephone: 1 312 985 3059 / 312 972 6646