Alberta's consumer debt delinquencies spike as nation's hit record low

In another sign of the lopsided impact of the downturn in the energy sector, consumer delinquency rates in Alberta have spiked while Canadians in most other provinces are better than ever at paying back their loans.

The numbers were released Wednesday by the U.S.-based credit monitoring firm Equifax.    

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Nationally, the delinquency rate (excluding mortgages) in the third quarter of 2015 is the lowest it has ever been —1.05 per cent, down 4.3 per cent compared to the same period last year.

However, in Alberta the rate delinquency rate increased by 13.4 per cent, Equifax says. The rate in Calgary climbed by 8.5 per cent, while Edmonton saw an increase of 7.9 per cent.

The average debt-load among Albertans (excluding mortgages) is $27,490. The average Calgarian has $28,355 in debt, and in Edmonton the figure is $26,420.

Bruce Alger, a trustee with the accounting firm Grant Thornton, says the numbers aren't surprising, given the economic situation.

"I don't see a bright future for us right now in terms of the price of oil and quite frankly I think, sadly, things are probably going to get worse before they get better," he said. "Q4 is probably going to be a little bit worse than Q3."

People in other energy-dependent provinces also took a hit. In Newfoundland and Labrador, the rate rose 5.8 per cent and in Saskatchewan, it rose 8.5 per cent.

By contrast, in Ontario the delinquency rate dropped 10.9 per cent. 

Rate of delinquent loans falls to record low

Equifax Canada says the countrywide rate of delinquent loans — payments are overdue by more than 90 days — fell to 1.05 per cent in the third quarter, the lowest rate ever.

"We are now seeing a negative effect in Western Canada. The same holds true in Newfoundland — essentially anywhere in the country where the economy is impacted by oil," Regina Malina, senior director of decision insights at Equifax Canada, said in a release.

The Canadian average is $21,312 — which has increased by 2 per cent over the third quarter of 2014.

"Consumer debt levels continue to rise and those numbers are sure to increase following the holidays," said Malina.

"However, despite other market research we've seen predicting a boom in spending over the holidays, we expect most Canadians will continue to manage their spending wisely. Demand for new credit has eased off."