Bank of America credit write-offs drop in June

Bank of America on Thursday said the credit card balances it wrote off as uncollectable in June fell for the third straight month. Like other companies that offer credit cards, the bank also said past-due payments dropped to their lowest point of the year.
In a regulatory filing, Bank of America said its charge-off rate dropped to 11.98 percent of balances, from 12.7 percent in May.
Card companies typically write off loans after they're 180 days past due, the point at which it's assumed the balances won't be collected.
In the past year, banks have written off a record amount of loans as customers struggled to pay. By the first three months of this year, the charge-off rate was just short of 10 percent of balances. That compares with a rate of 3.8 percent in the second quarter of 2007, before the recession began.
Bank of America is the among the top three U.S. banks for credit cards, with about 80 million cards in circulation, according to the Nilson Report, an industry newsletter.
Bank of America said the rate of late payments has fallen to its lowest point of the year, 6.16 percent in June, from 6.39 percent in May. That's a sign that the debt burdens felt by card holders over the past two years is beginning to ease.
In afternoon trading, Bank of America shares fell 56 cents, or 3.6 percent, to $15.11.