Citi sees increase in overdue personal loans

09/01/2010
By Credit.com Staff

Efforts to boost operations and make Citibank's consumer finance unit more appealing to potential investors may be partly to blame for the 0.25 percentage point increase in personal loan delinquencies during July, according to Bloomberg. Although the bank predicted a slight rise in the delinquency rate while more than 400 branches were either closed or underwent changes, the increase was higher than expected.

At the end of June, Citibank had $15.4 billion in personal loans on their books, Bloomberg reports. Following the rise in overdue loans, the bank saw personal loan outstanding balances reach $38.5 million. The bank notes that the amount of personal loans at least 90 days or more overdue continues to grow, increasing from 3.06 percent at the end of June 2009 to 3.27 percent one year later.

As lending criteria remains strict, more Americans are finding alternatives to secure financing, utilizing personal loans, borrowing from friends and family and making early withdrawals from retirement accounts.

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