S&P/Experian Index Shows Default Rates Decline Across All Credit Lines

NEW YORK — Data through September 2010, released today by Standard & Poor’s and Experian for the S&P/Experian Consumer Credit Default Indices, a comprehensive measure of changes in consumer credit defaults, showed a decline in monthly default rates for all credit lines. First and second mortgages declined in September to 3.0% and 2.1% respectively. Auto loans decreased slightly from 2.1% in August to 2.0% in September. Bank cards had the largest decline in defaults in the past 12 months down to 7.0%.

“The S&P/Experian Consumer Credit Default Indices are showing declining default rates at the national level for all categories, including auto loan defaults which had risen over the previous two months,” says Craig Feldman, Director at S&P Indices. “All  five of the highlighted cities are showing declines as well, with Miami and Los Angeles continuing to show the largest year-over-year drop in default rates, as has been the trend for the last three months.”

Consumer credit defaults vary across major cities and regions of the U.S. Among the five major Metropolitan Statistical Areas reported each month in this release, Los Angeles had the largest decrease in defaults, for the second month in a row, of 13.8%, followed by Dallas which declined by 9.83%. New York and Chicago experienced a modest decline of 5.23% and 4.84% respectively. Miami continues to decline by 40.30% in the last 12 months.

Jointly developed by Standard & Poor’s and Experian, the S&P/Experian Consumer Credit Default Indices are published on the third Tuesday of each month at 9:00 am ET. They are constructed to accurately track the default experience of consumer balances in four key loan categories: auto, bankcard, first mortgage lien and second mortgage lien. The Indices are calculated based on data extracted from Experian’s consumer credit database. This database is populated with individual consumer loan and payment data submitted by lenders to Experian every month. Experian’s base of data contributors includes leading banks and mortgage companies, and covers approximately $11 trillion in outstanding loans sourced from 11,500 lenders.

For more information, please visit: www.consumercreditindices.standardandpoors.com.

About S&P Indices
S&P Indices, the world’s leading index provider, maintains a wide variety of investable and benchmark indices to meet an array of investor needs. Over $1 trillion is directly indexed to Standard & Poor’s family of indices, which includes the S&P 500, the world’s most followed stock market index, the S&P Global 1200, a composite index comprised of seven regional and country headline indices, the S&P Global BMI, an index with approximately 11,000 constituents, and the S&P GSCI, the industry’s most closely watched commodities index.  For more information, please visit www.standardandpoors.com/indices.

About Standard & Poor’s
Standard & Poor’s, a subsidiary of The McGraw-Hill Companies (NYSE: MHP), is the world’s foremost provider of independent credit ratings, indices, risk evaluation, investment research and data. With offices in 23 countries and markets, Standard & Poor’s is an essential part of the world’s financial infrastructure and has played a leading role for 150 years in providing investors with the independent benchmarks they need to feel more confident about their investment and financial decisions. For more information, visit http://www.standardandpoors.com

Standard & Poor’s does not sponsor, endorse, sell or promote any S&P index-based investment product. The S&P/Experian Consumer Credit Default Indices are products of S&P Indices, which operates independently of Standard & Poor’s Ratings Group. Standard & Poor’s Ratings Group plays no role in the compilation, distribution or licensing of the Indices.

About Experian Capital Markets
Formed as a response to market needs, Experian Capital Markets leverages Experian’s comprehensive U.S. consumer and business databases to provide data and analytics to serve the transparency needs of the structured finance market participants. By taking underlying borrower data and applying advanced analytics, Experian provides insight into U.S. consumer and business credit behavior across all obligations, helping to forecast future payment patterns on prepayments, delinquencies, charge-offs or defaults for non-agency residential mortgage–backed securities and other asset-backed securities.

About Experian
Experian is the leading global information services company, providing data and analytical tools to clients in more than 65 countries. The company helps businesses to manage credit risk, prevent fraud, target marketing offers and automate decision making. Experian also helps individuals to check their credit report and credit score and protect against identity theft.

Experian plc is listed on the London Stock Exchange (EXPN) and is a constituent of the FTSE 100 index. Total revenue for the year ended March 31, 2009, was $3.9 billion. Experian employs approximately 15,000 people in 40 countries and has its corporate headquarters in Dublin, Ireland, with operational headquarters in Nottingham, UK; Costa Mesa, California; and Sao Paulo, Brazil.

For more information, visit http://www.experianplc.com.