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Russians Missing More Credit Payments

 We are starting to see a worrying trend in Russia, a country that has generally had very good credit performance over the last couple of years. According to the FICO Credit Health Index prepared by FICO and the National Bureau of Credit Histories (NBKI), Russia’s leading credit bureau, Russian borrowers’ credit repayments fell in the third quarter for the second time this year.

While the drop was only small, it put the index at its lowest point since October 2010, 111 points. This index measures the overall credit health of the country, based on the percentage of consumer loans and credit cards reported to NBKI that are delinquent by more than 60 days.

As we noted in our news release, the overall credit performance is still at a healthy level. But Evgeni Shtemanetyan, who directs FICO’s operations in Russia, noted that, “We advise credit organizations to monitor their customers closely, and review their credit approval strategies.” I could not agree more, and would just note that this means not only originations but customer management and collections strategies.

Russian CHI Nov 2012

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