US Consumers Fall Behind on Loans

July 9, 2009 by · Leave a Comment 

By Jonathan Stempel

NEW YORK (Reuters) – Soaring U.S. unemployment and a shrinking economy drove delinquencies on credit card debt and home equity loans to all-time highs in the first quarter as a record number of cash-strapped consumers fell behind on their bills.

Delinquencies on the value of all card debt soared to a record 6.60 percent from 5.52 percent in the fourth quarter as more cardholders relied on plastic to meet day-to-day expenses, the American Bankers Association said.

Late payments on home equity loans rose to 3.52 percent from 3.03 percent, and on home equity lines of credit climbed to 1.89 percent from 1.46 percent.

A broader gauge showing late payments on eight categories of loans rose for a fourth straight quarter to a new record, edging up to 3.23 percent from 3.22 percent. That rate actually understates consumer pain because it excludes credit cards. The ABA tracks loan payments that are at least 30 days late.

“The biggest driver is job losses,” ABA Chief Economist James Chessen said in an interview. “When people lose their jobs or work fewer hours, it makes it that much harder to meet their obligations. Unfortunately, we’re going to see higher job losses in the next year, and I expect elevated delinquencies.”

The ABA represents most large U.S. banks and credit card companies. Tuesday’s data are a bad sign for them as they prepare to report second-quarter results starting next week.

While improved capital markets may boost the bottom lines of some, analysts expect lenders such as Bank of America Corp, JPMorgan Chase & Co, Citigroup Inc, Capital One Financial Corp and American Express Co to suffer higher credit losses, especially in cards.

Borrowers are struggling as the nation’s jobless rate sits at a 26-year high of 9.5 percent, with 6.5 million jobs having disappeared since the recession began in December 2007. The Obama administration expects the unemployment rate to hit double digits before declining.

U.S. consumers ended March with $939.6 billion of revolving credit outstanding, a rough approximation of credit card debt, according to Federal Reserve data.

“Consumers tend to rely on credit cards as a bridge to cover their daily needs until they find new jobs,” Chessen said. “It’s taking longer to find those jobs.”

Meanwhile, home prices are down 32.6 percent from their peak in 2006, according to the Standard & Poor’s/Case-Shiller Home Price Indices of 20 large metropolitan areas.

The ABA in June said it expects the recession to end this quarter, despite rising unemployment.

The overall ABA delinquency rate includes direct auto, indirect auto, closed-end home equity, home improvement, marine, mobile home, personal, and recreational vehicle loans.

Delinquencies rose to 3.01 percent from 2.03 percent on direct auto loans, to 3.70 percent from 2.96 percent on mobile home loans, to 3.47 percent from 2.88 percent on personal loans, and to 1.52 percent from 1.38 percent on recreational vehicle loans.

They fell to 3.42 percent from 3.53 percent on auto loans made through dealers, to 2.04 percent from 2.35 percent on marine loans, and to 1.46 percent from 1.75 percent on property improvement loans.

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Kareem Shora Appointed

June 11, 2009 by · Leave a Comment 

ADC Press Release

Kareem Shora was appointed by DHS Secretary Napolitano on Homeland Security Advisory Council (HSAC)

Washington, DC | June 5, 2009 | www.adc.org |  The American-Arab Anti-Discrimination Committee (ADC) is proud to announce that earlier today at a ceremony held in Albuquerque, New Mexico, DHS Secretary Janet Napolitano swore-in ADC National Executive Director Kareem Shora as a member of the Homeland Security Advisory Council (HSAC).

Kareem_Shora HSAC members, limited by charter to no more than 21, are appointed by the DHS Secretary and are comprised of national security experts from state, local and tribal governments, first responder communities, academia and the private sector.  HSAC provides advice and recommendations directly to Secretary Napolitano on homeland security issues. ADC President Mary Rose Oakar said “This appointment is a great reflection on Kareem’s ability and the work of the American-Arab Anti-Discrimination Committee. We are very proud of Kareem and believe his appointment will be very helpful in the protection of the civil rights of people with Arab roots as well as others”.

Other members of the HSAC include Lee Hamilton, former Congressman and President of the Woodrow Wilson International Center for Scholars; Martin O’Malley, Governor of Maryland; Judge William Webster, former Director of Central Intelligence; Sonny Perdue, Governor of Georgia; Raymond Kelly, New York City Police Commissioner; Louis Freeh, former FBI Director and Senior Managing Partner at Freeh Group International; Frances Fragos Townsend, former White House Homeland Security Advisor; Kenneth “Chuck” Canterbury, National President of the Fraternal Order of Police; Manny Diaz, Mayor of Miami, Florida; Jared “Jerry” Cohon, President of Carnegie Mellon University; Leroy “Lee” Baca, Sheriff of the Los Angeles County Sheriff’s Department; Clark Kent Ervin, former DHS Inspector General and Director of the Homeland Security Program at The Aspen Institute; Sherwin “Chuck” Wexler, Executive Director of the Police Executive Research Forum; Harold Schaitberger, General President of the International Association of Firefighters; and Joe Shirley Jr., President of the Navajo Nation, among others.

Shora, who joined ADC in 2000 as Legal Advisor, was ADC Legal Director before he was appointed to his current position as National Executive Director in 2006.  He is a recipient of the 2003 American Immigration Lawyers Association (AILA) Arthur C. Helton Human Rights Award. He has been published by the National Law Journal, TRIAL Magazine, the Georgetown University Law Center’s Journal on Poverty Law and Public Policy, the Harvard University JFK School of Government Asian American Policy Review, the American Bar Association (ABA) Air and Space Lawyer, and the Yeshiva University Cardozo Public Law Policy and Ethics Journal. A frequent guest on Al-Arabiya and Al-Jazeera and numerous American television programs, Shora has spoken about civil rights, civil liberties and immigration policy with many national and international media outlets including the Wall Street Journal, Voice of America, the New York Times, the Washington Post, the Associated Press, CNN and the Chicago Tribune among others. He has also testified before major international human rights bodies including regular testimonies before the Organization for Security and Cooperation in Europe (OSCE) and the United Nations Human Rights Commission. He is also a member of the ODNI Heritage Community Liaison Council.

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