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National credit card market rebounds after rough Q1

Credit card spending jumped in the second quarter of 2014 after a decline in the first three months, according to the American Bankers Association.

The group’s Credit Card Market Monitor showed sub prime spending increased 14.3 percent. Prime account spending rose 10.3 percent and super prime purchases went up 8.2 percent.

The credit card market normally drops in the first quarter of each year, as it has for five straight years. The jump in all categories for 2014’s second quarter, however, was larger than it has been in the previous four years, according to the report.

Other findings:

• The number of new accounts rose year over year for the third straight year after bottoming out in the second quarter of 2011. The new account volume rose 10 percent compared to the second quarter of 2013. Prime-rate accounts showed the highest jump from 19 million to 22 million.

• The number of all credit card accounts increased 7 percent from 284 million to 304 million. It was the second straight year of an increase after falling for four straight years.

• Average credit lines for all accounts continued to fall but, according to the report, at slower rates than had been witnessed. The biggest drop was in prime accounts, where the average credit line dropped 0.9 percent to $7,116.

Michael Sadowski

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