Who's The Best Consumer Lender? ALLY, AXP, AX, COF, SOFI, LC, SYF
- 4 days ago
- 7 min read
Updated: 3 days ago
April 9, 2026 | How is the US consumer faring as the war with Iran enters the second month? President Donald Trump has started a war in the Middle East to escape a darkening domestic scene at home. Spending remains strong, but consumer sentiment slipped to a three-month low in March due to geopolitical tensions driving up oil prices and rising inflation fears. Affordability remains the top concern of consumers as Q1 2026 comes to an end and bank earnings start next week. The midterm elections are eight months away.
Consumer loan defaults continue to trend lower after peaking a year ago in Q1 2025. We've noted for a while that delinquency in the bottom quartile of consumers has been rising, but the picture in terms of the overall portfolio of bank loans remains positive. The rising levels of defaults visible in commercial exposures captured by private credit have not yet crossed over into consumer credit exposures. Pockets of credit weakness remain, particularly in commercial real estate (CRE) and lower-income consumer credit, yet overall credit quality has proven more resilient than expected, notes S&P.
“As household debt levels grow modestly, mortgage delinquencies continue to increase,” said Wilbert van der Klaauw, Economic Research Advisor at the New York Fed said in February. “Delinquency rates for mortgages are near historically normal levels, but the deterioration is concentrated in lower-income areas and in areas with declining home prices.”
“Aggregate delinquency worsened in Q4 2025, with 4.8% of outstanding debt in some stage of delinquency,” the Fed report . “Transitions into early delinquency were mixed with mortgages and student loans increasing, while all other debt types held steady. Transitions into serious delinquency ticked up for credit card balances, mortgages, and student loans while auto loans and HELOC decreased slightly.”
The Consumer Lenders: ALLY, AXP, AX, BCS, COF, LC, SOFI, SYF
As Q1 2026 earnings begin next week, let’s review the consumer lending group to update readers on performance and other developments. Although the FRBNY noted higher levels of delinquency in lower income households, overall banks are reporting lower credit losses across the entire spectrum of loans. Losses for the eight banks in our consumer loan group reflect this trend, as shown below in the chart using data from the FFIEC.
Source: FFIEC
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