/24-7PressRelease/ - LONDON, UK - Friday, May 28, 2008 - (Longdog Finance Limited) - In a report on the bonds backed by the assets, Standard & Poor's said, "Non-remittances on prime and non-conforming UK mortgages and on credit cards are rising as lending conditions tighten and the economy weakens," Standard & Poor's also added that the delinquencies for non-conforming mortgages which are provided to the borrowers having poorer credit histories has rose to 21.73 percent in the first quarter, from 19.41 percent in the fourth quarter of 2007. Moreover, delinquencies of more than 90 days have been moved into double digits, at 10.6 percent.
Kate Livesey, an analyst at Standard & Poor's said, "A reduction in refinancing opportunities for borrowers, the large proportion of loans (approximately 25 percent) due to revert from fixed or discount rates in the first half of 2008 into an environment of reduced credit availability, and the slowing economy are likely to keep non-payment figures high for the predictable future."
"The losses are remained low, but are rising and are appearing earlier in the life of some transactions." she added.
According to the ratings agency, for the mainstream prime mortgages, total delinquencies rose to 2.41 percent in the first quarter from 2.11 percent.
In the market of credit cards, charge-offs, the point at which the lender regards the debt as bad debt, has been risen to 6.51 percent in March from 6.17 percent in December, while delinquencies rose to 5.88 percent from 5.6 percent.
"The loan providers have introduced more cautious lending strategies, causing delinquencies to increase as borrowers start to feel the effects of the downturn in the UK economy," said Standard & Poor's.
Nonetheless, it said the jump in the charge-off rate could be explained by the acquisition by Barclays of the Goldfish credit card unit, with a change in the unit's charge-off policies to align them with those of Barclays.
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