TransUnion: Canadian Total Debt Stabilizes After 6 1/2 Years of Increases

TORONTO--(Marketwire - Dec 1, 2011) - TransUnion's quarterly analysis of Canadian credit trends found that the average consumer's total debt (excluding mortgage) dropped to $25,594 in the third quarter, marking the third consecutive quarter the variable has either declined or remained stable. Canada had previously experienced 26 straight quarterly increases in average consumer debt between 2Q 2004 and 4Q 2010.

"The latest quarterly data suggests that Canadian debt loads truly are stabilizing," said Thomas Higgins, TransUnion's vice president of analytics and decision services. "Global economic uncertainty surely played a part in Canadians' move to further draw down their debt load. In the third quarter alone, Canadian consumers witnessed major stock market declines, the European debt crisis and continued high unemployment."

Changes in total debt appear to be occurring throughout Canada. Six provinces experienced drops or stable total debt numbers in the third quarter of 2011. On a year-over-year basis, only two provinces -- British Columbia and New Brunswick -- have had total balances decline.

"The next two quarters will be important as we observe if year-over-year total debt begins dropping in the majority of provinces," added Higgins.

Average Consumer Debt Q3 2010 Q4 2010 Q1 2011 Q2 2011 Q3 2011 Q/Q Chg Y/Y Chg
British Columbia $37,193 $36,785 $36,649 $36,820 $36,588 -0.6% -1.6%
Alberta $33,067 $34,020 $34,185 $34,081 $33,182 -0.3% 0.4%
Ontario $24,383 $25,239 $24,869 $24,721 $24,540 -0.7% 0.6%
Quebec $17,521 $17,424 $18,025 $18,269 $18,751 2.6% 7.0%

Consumer Debt -- Quarterly/Yearly
Though total consumer debt (excluding mortgage) has declined or remained about the same for three consecutive quarters, it is still tracking up 1.71% on a year-over-year basis (from $25,163 in Q3 2010 to $25,594 in Q3 2011). However, a deceleration in total debt increases has occurred. The previous three quarters showed year-over-year total debt increases of 2.99% (Q2 2010-2011), 4.49% (Q1 2010-Q1 2011) and 5.60% (Q4 2009-Q4 Q2010).

Other key credit statistics include:

  • Canadian average credit card borrower debt (defined as the aggregate balance on all credit cards for an individual bankcard borrower) declined 2.65% year over year, but posted an increase of 0.59% quarter over quarter.
  • Canadian lines of credit (LOC) borrower debt (defined as the aggregate balance on all LOC for an individual LOC borrower) increased 4.5% year over year and 0.79% quarter over quarter.
  • Canadian installment loan borrower debt (defined as the aggregate balance on all installment loans for an individual installment loan borrower) decreased 1.7% year over year with a slight increase of 0.27% quarter over quarter.
  • Canadian auto borrower debt (defined as the aggregate balance on all auto captive loans for an individual auto captive borrower) increased more than 6.8% year over year and 3.7% quarter over quarter.
Q3 2010 Q4 2010 Q1 2011 Q2 2011 Q3 2011
Credit Cards $3,709 $3,688 $3,539 $3,590 $3,611
Lines of Credit $32,649 $33,981 $33,762 $33,855 $34,122
Installment Loans $22,731 $22,976 $22,431 $22,281 $22,340
Auto Captives $16,183 $16,189 $16,181 $16,671 $17,283

Consumer Delinquencies -- Quarterly/Yearly

While delinquency levels dropped on a year-over-year basis across all product categories, installment and auto captive loans have increased in Q3 2011.

"When evaluating delinquency levels, it's important to put emphasis on lines of credit as they account for over 40% of all Canadian non-mortgage debt," said Higgins. "Since the second quarter of 2009, lines of credit delinquencies have dropped 5 basis points from 0.25% to 0.20%."

"Though delinquency levels have remained relatively stable during the third quarter, increased unemployment may place some pressure on these levels in the coming months," added Higgins. "October unemployment rates rose from 7.1% to 7.3% in Canada and with the holiday shopping season gearing up, it wouldn't be surprising to see delinquencies rise in the next 2 quarters."

Q3 2010 Q2 2011 Q3 2011 Q/Q Chg Y/Y Chg
Credit Cards 0.34% 0.33% 0.32% -3.1% -5.9%
Lines of Credit 0.21% 0.20% 0.20% 0.0% -4.8%
Installment Loans 1.54% 1.27% 1.32% 3.9% -14.3%
Auto Captives 0.11% 0.10% 0.11% 10.0% 0.0%

Three Highest Delinquency Provinces

Credit Cards Lines of Credit Installment Loans Auto Captives
PEI 0.58% BC 0.28% ON 2.07% MB 0.49%
NB 0.50% ON 0.23% PEI 1.78% NS 0.19%
NS 0.49% AB 0.22% NS 1.75% NB 0.18%

Three Lowest Delinquency Provinces

Credit Cards Lines of Credit Installment Loans Auto Captives
QC 0.20% NL 0.13% QC 0.49% QC 0.07%
BC 0.32% QC 0.13% NL 1.16% NL 0.08%
SK 0.32% SK & NB 0.15% SK 1.20% BC 0.08%

TransUnion's Market Trends
TransUnion's Market Trends is an in-depth, full sample solution that provides statistical information every quarter from TransUnion's national consumer credit database, culled from anonymous credit files. Each Canadian consumer record contains hundreds of credit variables that illustrate consumer credit usage and performance. By leveraging Market Trends, customers from a variety of industries can analyze industry trends over an entire business cycle, helping to understand consumer behaviour in different geographic locations throughout Canada.

About TransUnion
As a global leader in information and risk management, TransUnion creates advantages for millions of people around the world by gathering, analyzing and delivering information. For businesses, TransUnion helps improve efficiency, manage risk, reduce costs and increase revenue by delivering high quality data, and integrating advanced analytics and enhanced decision-making capabilities. For consumers, TransUnion provides the tools, resources and education to help manage their credit health and achieve their financial goals. Through these and other efforts, TransUnion is working to build stronger economies worldwide. Based in Burlington, Ontario, with global headquarters located in Chicago, Illinois, TransUnion provides local service and support throughout Canada. Visit to learn more.

Contact Information:

Dave Blumberg
Telephone 1 312 985 3059/ 312 972 6646

Canadian Credit Trends