04/18/2024 | News release | Distributed by Public on 04/18/2024 07:09
This report presents the results of a first-of-its kind survey of leading providers of mortgages, vehicle financing, personal installment loans, credit cards, and other consumer products. Participants provide their views on several key business indicators, including how they see consumer lending evolving in the coming months.
The survey's results show conditions facing consumer lenders deteriorated on balance in the first quarter of 2024, compared to the fourth quarter of 2023:
Lenders, however, expressed a greater degree of optimism regarding the business outlook six months hence.
The following charts summarize survey results for the full consumer credit sector. Additional detailed results, as well as a description of the survey methodology are provided in appendices.
Current Conditions
Overall Conditions: NII -19.3
Customer Demand: NII -14.5
Funding Costs: NII -12.7
Loan Performance: -3.5
Expected Conditions
Overall Conditions: NII +8.9
Customer Demand: NII +30.4
Funding Costs: NII +21.8
Loan Performance: NII -5.3
Appendix 1: Data Tables
Current Conditions
All Lenders
Vehicle Financing
Personal Installment Loans
Other
Expected Conditions
All Lenders
Vehicle Financing
Personal Installment Loans
Other
Appendix 2: Methodology
The results presented in this report are derived from a survey of senior executives of 175 AFSA finance company members. The survey was conducted between March 27 and April 8, 2024. Fifty-seven (57) participants responded to at least one question. Response counts for individual questions are shown in the accompanying charts and data tables.
The survey consisted of the following questions:
For questions regarding current conditions, participants were asked if conditions relative to the previous quarter "improved considerably," "improved somewhat," "stayed basically the same," "worsened somewhat," or "worsened considerably." For questions regarding expected conditions, participants were asked if conditions over the next six months would "improve considerably," "improved somewhat," "stay basically the same," "worsen somewhat," or "worsen considerably."
Index Calculation. The Net Improving Index (NII) for current conditions questions is calculated as the percentage of participants reporting conditions "improved considerably" or "improved somewhat" minus the percentage reporting conditions "worsened somewhat" or "worsened considerably."
The NII for future conditions questions is calculated as the percentage of participants reporting they expect conditions to "improve considerably" or "improve somewhat" minus the percentage reporting they expect conditions to "worsen somewhat" or "worsen considerably."
Breakdown by Type of Credit Offered. Participants were asked to indicate the types of consumer credit provided by their company: "credit cards," "personal installment loans," "vehicle financing, "sales financing," "student loans," "mortgages/ home equity loans," and "other." They were not, however, asked to provide separate responses for each type of credit offered, only a consolidated evaluation of conditions affecting their company as a whole. If a company provides both personal installment loans and vehicle financing, for example, its responses are included in the compilation of results for "all lenders," as well as for "vehicle financing" and "personal installment loans." Thus, the number of responses summed across credit types will not necessarily equal the total number of responses for a given question.
The number of responses indicating their company offered credit cards, sales financing, student loans, mortgages/home equity loans, and other types of credit were insufficient to report separately. These were aggregated and reported as a single "other" category.
April 18th, 2024 by [email protected]