MarketWatch: Citigroup says credit card losses may hit record levels in 2009

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Citi says credit card losses may rise through 2009
Bank suffers $1.4 billion hit from card-backed assets in latest quarter
By Greg Morcroft, MarketWatch


NEW YORK (MarketWatch) -- Citigroup said that it lost $1.4 billion in the third quarter from credit card securitizations and that it expects such losses will continue, possibly reaching record levels in 2009.

The result compared to a gain of $169 million from credit card securitizations in the year-earlier period.

"Credit card losses may continue to rise well into 2009, and it is possible that the company's loss rates may exceed their historical peaks," the banking giant said in its filing with the Securities and Exchange Commission late Friday.

Citi also said it added $3.9 billion to overall credit reserves, including $2.3 billion for its North American consumer business and $855 million for consumer business outside the U.S.

Citi said the additional reserve to the North American segment was mostly due to a weakening of leading credit indicators, including higher delinquencies on first mortgages, unsecured personal loans, credit cards and auto loans.

Citigroup's revealtion is just the latest news in a string of negative disclosures from the credit card industry. .......(more)

The complete piece is at: http://www.marketwatch.com/News/Story/Story.aspx?guid={BE8D388F-5173-4BC3-A880-DC409509989C}

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1. Has anyone done a study on the correlation between rising interest rates

......and rising unpaid credit card bills?

Have any of these mafioso credit card companies stopped to think theres a point of no return on the rates and fees they can get away with charging their customers before solid customers stop trying to pay them back?

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2. "mafioso credit card companies"

Exactly. Legalized shakedowns.

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3. They are chopping everyone's credit limit.

and everyone and their mama is "refusing changes to my agreement" when they get the notice about jacking up the interest rates on people making minimums. So of course the outlook on future profits from fleecing the rubes is down.

Cry me a river.