A Monetary Authority survey on credit card lending has found the amount charged off in the fourth quarter of 2003 fell for the fifth consecutive quarter to $1.13 billion or 2.05% of average receivables.

The 'annualised' ratio was 8.19% compared with 9.85% in the previous quarter, and the lowest since the fourth quarter of 2001.

The delinquency ratio fell below 1% at the end of December to 0.92%, compared with 1.23% in September.

Outstanding rescheduled card receivables amounted to $166 million or 0.3% of total receivables within the card portfolio.

Together, the delinquent and rescheduled ratio stood at 1.22% in December.

Credit card accounts up 0.4%

The total number of credit card accounts rose 0.4%. Despite the transfer of some $169 million rescheduled receivables representing 0.3% of average receivables outside the credit card portfolio during the quarter, total receivables rose 4.3% in the fourth quarter, having fallen in the first three quarters.

The increase can be attributed to a combination of increased spending in December and the payment of salaries tax using credit cards.

The rollover amount, which reflects the amount of borrowing customers using their credit cards, fell for the seventh consecutive quarter to $27.8 billion from $28.8 billion in September.

"Debt rescheduling arrangements together with the lower trends in bankruptcy and unemployment continued to be the driving factors behind the improvement in the charge-off and delinquency situations in the card portfolio," Deputy Chief Executive William Ryback said.

"Despite this positive development, banks should remain watchful and be prudent on credit limits and the issue of new cards."