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C's January Card Delinquencies Rise: How it Will Impact Asset Quality?
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Key Takeaways
Citigroup reported a January delinquency rate of 1.46%, up from December but below prior-year levels.
Net charge-offs fell to 2.03%, while receivables declined sequentially and year over year.
Management sees 2026 NCL for Branded Cards at 3.50%-4%, signaling ongoing credit normalization pressure.
Citigroup Inc.’s (C - Free Report) subsidiary, Citibank N.A., reported mixed credit card performance for January 2026 in its latest SEC filing. For the period ending January 2026, the Citibank Credit Card Master Trust delinquency rate increased to 1.46% from 1.42% in December 2025. However, the figure decreased from 1.49% recorded in January 2025. It also declined from the 1.58% level posted in January 2020, before the pandemic disrupted economic activity.
Meanwhile, the Credit Card Issuance Trust net charge-off rate declined to 2.03% in January 2026 from 2.51% in the prior month. The figure also dropped from 2.26% in January 2025 and 2.49% in January 2020.
Citibank’s credit card lending activity slowed during the month. Principal receivables were $19.9 billion compared with $20.4 billion at the beginning of December 2025. On a year-over-year basis, receivables declined from $21.5 billion in January 2025.
While the sequential and year-over-year decline in net charge-offs is encouraging and points to near-term repayment stability, the uptick in delinquencies and continued decline in receivables reflect ongoing consumer pressure. Notably, the company’s net credit losses (NCL) recorded a compounded annual growth rate (CAGR) of 33.9% over the three years ended 2025. The provisions for credit losses also expanded at a CAGR of 24.5% during the same period.
Looking ahead, Citigroup’s profitability may face headwinds from sustained credit normalization in its Branded Cards portfolio. Management expects Branded Cards' NCL between 3.50% and 4% in 2026. Retail Services NCL is projected to be between 5.75% and 6.25%. In 2025, Branded Cards and Retail Services reported net credit losses of 3.60% and 5.73%, respectively.
If macroeconomic conditions weaken further, credit losses may accelerate, necessitating higher loan-loss provisions and weighing on financials. Although interest rates have declined, rise in delinquency and slowdown in consumer spending may hurt the company’s asset quality in the near term.
How Other Banks Fared in Terms of Card Delinquency
U.S. credit card metrics were mixed in January 2026, with trends varying across major issuers. Following the industry pattern, Bank of America (BAC - Free Report) reported easing delinquencies and net charge-offs, while JPMorgan Chase & Co. (JPM - Free Report) witnessed stable delinquencies but higher charge-offs.
At Bank of America, the BA Master Credit Card Trust II delinquency rate declined to 1.39% in January 2026 from 1.48% a year earlier. Bank of America’s net charge-off rate of 2.28% improved from 2.48% in January 2025.
JPMorgan’s Chase Issuance Trust delinquency rate remained unchanged at 0.88% in January 2026 compared with January 2025. However, JPMorgan’s net charge-off rate rose to 1.69% from 1.64% in the prior year, reflecting modest pressure in loss trends.
C’s Price Performance, Valuation & Estimates
Shares of Citigroup have gained 24.8% over the past six months compared with the industry’s growth of 10%.
Price Performance
Image Source: Zacks Investment Research
From a valuation standpoint, C trades at a forward price-to-earnings (P/E) ratio of 11.04X, below the industry’s average of 14.13X.
Price-to-Earnings F12M
Image Source: Zacks Investment Research
The Zacks Consensus Estimate for C’s 2026 and 2027 earnings implies year-over-year increase of 27.9% and 18.4%, respectively. The estimates for 2026 and 2027 have been revised upward over the past 30 days.
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C's January Card Delinquencies Rise: How it Will Impact Asset Quality?
Key Takeaways
Citigroup Inc.’s (C - Free Report) subsidiary, Citibank N.A., reported mixed credit card performance for January 2026 in its latest SEC filing. For the period ending January 2026, the Citibank Credit Card Master Trust delinquency rate increased to 1.46% from 1.42% in December 2025. However, the figure decreased from 1.49% recorded in January 2025. It also declined from the 1.58% level posted in January 2020, before the pandemic disrupted economic activity.
Meanwhile, the Credit Card Issuance Trust net charge-off rate declined to 2.03% in January 2026 from 2.51% in the prior month. The figure also dropped from 2.26% in January 2025 and 2.49% in January 2020.
Citibank’s credit card lending activity slowed during the month. Principal receivables were $19.9 billion compared with $20.4 billion at the beginning of December 2025. On a year-over-year basis, receivables declined from $21.5 billion in January 2025.
While the sequential and year-over-year decline in net charge-offs is encouraging and points to near-term repayment stability, the uptick in delinquencies and continued decline in receivables reflect ongoing consumer pressure. Notably, the company’s net credit losses (NCL) recorded a compounded annual growth rate (CAGR) of 33.9% over the three years ended 2025. The provisions for credit losses also expanded at a CAGR of 24.5% during the same period.
Looking ahead, Citigroup’s profitability may face headwinds from sustained credit normalization in its Branded Cards portfolio. Management expects Branded Cards' NCL between 3.50% and 4% in 2026. Retail Services NCL is projected to be between 5.75% and 6.25%. In 2025, Branded Cards and Retail Services reported net credit losses of 3.60% and 5.73%, respectively.
If macroeconomic conditions weaken further, credit losses may accelerate, necessitating higher loan-loss provisions and weighing on financials. Although interest rates have declined, rise in delinquency and slowdown in consumer spending may hurt the company’s asset quality in the near term.
How Other Banks Fared in Terms of Card Delinquency
U.S. credit card metrics were mixed in January 2026, with trends varying across major issuers. Following the industry pattern, Bank of America (BAC - Free Report) reported easing delinquencies and net charge-offs, while JPMorgan Chase & Co. (JPM - Free Report) witnessed stable delinquencies but higher charge-offs.
At Bank of America, the BA Master Credit Card Trust II delinquency rate declined to 1.39% in January 2026 from 1.48% a year earlier. Bank of America’s net charge-off rate of 2.28% improved from 2.48% in January 2025.
JPMorgan’s Chase Issuance Trust delinquency rate remained unchanged at 0.88% in January 2026 compared with January 2025. However, JPMorgan’s net charge-off rate rose to 1.69% from 1.64% in the prior year, reflecting modest pressure in loss trends.
C’s Price Performance, Valuation & Estimates
Shares of Citigroup have gained 24.8% over the past six months compared with the industry’s growth of 10%.
Price Performance
Image Source: Zacks Investment Research
From a valuation standpoint, C trades at a forward price-to-earnings (P/E) ratio of 11.04X, below the industry’s average of 14.13X.
Price-to-Earnings F12M
Image Source: Zacks Investment Research
The Zacks Consensus Estimate for C’s 2026 and 2027 earnings implies year-over-year increase of 27.9% and 18.4%, respectively. The estimates for 2026 and 2027 have been revised upward over the past 30 days.
Estimates Revision Trend
Image Source: Zacks Investment Research
Currently, C carries a Zacks Rank #3 (Hold). You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.