FICO, Efma: European consumer credit outlook dim

Financial risk managers in Europe are increasingly worried about consumers' abilities to pay off debt, with a growing number predicting higher delinquencies across mortgages, auto loans and other credit decisions. These are the results of the most recent European Credit Risk Survey from analytics firm FICO and retail association Efma. The study found four times as many credit risk managers expect delinquency rates to deteriorate over the next six months than improve. The study also found 71 percent of consumers agree or strongly agree that borrowers are now more hesitant to seek or use credit. Although reserved to Europe, the findings mirror decaying consumer sentiment in the U.S. as well, where high unemployment and general economic unease continue to plague markets and prolong the economic recovery. "These results are fully in line with the economic drama playing out across Europe," said Mike Gordon, vice president and general manager for FICO in Europe, the Middle East and Africa. "Mounting economic problems and uncertainty about the adequacy of public and private sector responses are contributing to a darkening picture of credit performance over the next few months."