Canadian credit card debt performance stabilized in the fourth quarter, with various measures of card performance either improving or holding steady compared with the prior quarter, reports Moody’s Investors Service.

The rating agency reports that the charge-off rate index slipped to 4.86%, from a record-high 4.92% in the third quarter. Moody’s expects charge-offs to continue to decline in 2010 as a result of fewer personal bankruptcies and lower unemployment during the year.

The firm estimates that bankruptcies will decline in Canada from about 25,000 in the fourth quarter of 2009 to approximately 21,500 by the fourth quarter of 2010. “We expect the unemployment rate and bankruptcy filings—two key drivers of credit card performance—to improve throughout 2010 and for these trends to translate into better credit card performance,” said Moody’s vice president and senior analyst, Sumant Inamdar.

Moody’s also says that the delinquency rate in the fourth quarter was 3.16%, up from the year-ago figure of 2.79%, but nearly flat to the third quarter mark of 3.14%.

The payment rate index, which measures cardholders’ willingness and ability to pay credit card debt, also continued to improve quarter-over-quarter, climbing 47 basis points during the fourth quarter to 30.76%.

IE