Despite a robust economy, Americans reportedly have suddenly stopped paying off their credit card bills quickly.
A Moody's report found that banks in the past two fiscal quarters marked a big increase in credit-card charge-offs — debt that companies can't collect from their customers.
Moody's charted for investors how each bank fared on charge-offs, with Capital One, First National of Nebraska, and Synchrony showing the worst performance over the period, Business Insider reported.
The sharp increase was the largest since 2009, and comes despite a strong employment market, Moody's noted.
Business Insider's Alex Morrell wrote the rise "suggests that American consumers haven't fallen on hard times so much as banks have started to loosen their standards and issue credit more aggressively."
According to the outlet, card issuers got a lot more strict after passage of the Card Act in 2009, which made acquiring a card harder – especially if you had subprime credit.
Though the ratio of charge-offs to unemployment claims had been hovering near all-time lows, Moody's report shows that "it's back up to the up to the historical average in the past two quarters," Morrell wrote, "meaning standards may have deteriorated 'rapidly.'"
If those lending standards continue to degrade, things could go south in a hurry, Moody's warned.
"Although card standards were extremely tight in the years following the financial crisis, if underwriting then loosened materially, as the rise in charge-offs suggests, asset quality could continue to deteriorate rapidly going forward, especially in the event of a recession," said Warren Kornfeld, a senior vice president at Moody's, said in a statement.
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