Credit Card Companies Slash Rewards To Cushion Losses


	Credit Card Companies Slash Rewards To Cushion Losses

Forbes Markets

3-13-2009 9:26 AM

396 views

tags:

credit cards, banking, credit losses, credit crunch

Forbes Markets says:

Credit card charge-offs -- debts card companies fear they will never be able to collect -- could climb to 9%-10% this year from 6%-7% at end of 2008.

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<div style="margin: 12px 0px; font-family: arial; color: #333333; background: #ffffff; border: solid 4px #e5e5e5; width: 100%; clear: left;"><div class="CM_CTB_Content_Wrap" style="margin: 0px; padding: 0px;background-color: #ffffff;"><div style="border-bottom: solid 1px #dcdcdc; white-space: nowrap; margin-bottom: 8px; background-color: #eeeeee ;background-image: url(http://clipmarks.com/images/source-bg.gif); background-repeat: repeat-x; height: 24px; line-height: 24px; vertical-align: middle; padding-bottom: 4px; color: #666666; font-size: 10px;" ><a href="http://clipmarks.com/clip-to-blog/" title="see clips that are hot right now"><img src="http://content.clipmarks.com/blog_embed/1ccf89b7-046e-42ab-aa62-6d51a9da9513/6A87CE55-0585-4008-A04E-D68366717942/" alt="" width="19" height="19" border="0" style="vertical-align: middle; margin: 0px 4px; display: inline; border: none; float:none;" /></a>clipped from <a title="http://www.reuters.com/article/ousiv/idUSTRE52A4QN20090311" href="http://www.reuters.com/article/ousiv/idUSTRE52A4QN20090311" style="font-size: 11px;">www.reuters.com</a></div><blockquote style="text-align: left; padding: 0px 8px; margin: 4px 0px 8px 0px; background: transparent; border: none;" cite="http://www.reuters.com/article/ousiv/idUSTRE52A4QN20090311"><P>Not long ago, Americans were being offered as much as $100 just to sign up for a credit card. Now, up to $300 is being dangled as an incentive for them to give up their plastic.</P><SPAN id="midArticle_1"></SPAN>
<P>U.S. credit card issuers -- from Citigroup Inc to JPMorgan Chase & Co to Capital One Financial Corp -- are slashing rewards, raising interest rates and increasing fees as loan losses mount.</P><SPAN id="midArticle_2"></SPAN>
<P>"All these (actions) are ways to maintain a certain profit level in the business," said Moshe Orenbuch, an analyst at Credit Suisse.</P><SPAN id="midArticle_3"></SPAN>
<P>"The combination of rising losses, funding costs, which at the end of 2008 were high, and difficulties borrowing money put pressure on profits."</P></blockquote></div><div style="margin: 0px 6px 6px 4px;"><table style="font-size: 11px;border-spacing: 0px;padding: 0px;" cellpadding="0" cellspacing="0" width="100%"><tr><td style="background:transparent;border-width:0px;padding:0px;">&nbsp;</td><td align="right" style="background:transparent;border-width:0px;padding:0px;width:107px" width="107"><a href="http://clipmarks.com/share/6A87CE55-0585-4008-A04E-D68366717942/blog/" title="blog or email this clip"><img src="http://content9.clipmarks.com/images/c2b-foot.png" border="0" alt="blog it" width="107" height="17" style="border-width:0px;padding:0px;margin:0px;" /></a></td></tr></table></div></div>

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