Equifax, Inc. · NYSE:EFX
Equifax — Market Pulse Webinar: Planning the Future from Today's Consumer Spending (January 2022)
48 slides from Equifax's conference presentation, Jan 20, 2022
Slide 1: Planning the Future from Today's Consumer Spending
Planning the Future from Today’s Consumer Spending Webinar | January 20, 2022
Slide 2: Disclaimer
The opinions, estimates and forecasts presented herein are for general information use only. This material is based upon information that we consider to be reliable, but we do not represent that it is accurate or complete. No person should consider distribution of this material as making any represe
Slide 3: Agenda
Age n d a Spending Momentum Index Consumer Credit Trends flowcode.com/p/PbsNd4M2A?fc=0 Small Business Insights Q&A Questions? Contact us here. linkedin.com/company/equifax/ twitter.com/EquifaxInsights PROPRIETARY | 3
Slide 4: Presenters
Presenters Wayne Best Tom Aliff Chief Economist Risk Consulting Leader Visa Equifax Sarah Briscoe Lead Commercial Statistical Analyst Equifax PROPRIETARY | 4
Slide 5: Additional Resources
Additional Resources Market Pulse Webinars • Register fo r u p co m in g Ma rke t Pu lse we b in a rs • View replays a n d download slides fro m p a st we b in a rs Market Pulse Podcast • Listen fo r a d d itio n a l tim e ly e co n o m ic a n d cre d it in sigh ts • Subscribe to d a y wh e re yo u
Slide 6: Spending Momentum Index
Spending Momentum Index Wayne Best Visa PROPRIETARY | 6
Slide 7: Spending Momentum Index Briefing and introduction
Spending Momentum Index Briefing and introduction Wayne Best, Chief Economist, Visa
Slide 8: Notice of confidentiality
Notice of confidentiality This presentation is furnished to you solely in your capacity as a customer of Visa Inc. and/or a participant in the Visa payments system. By accepting this presentation, you acknowledge that the information contained herein (the “Information”) is confidential and subject t
Slide 9: Forward-looking statements and disclaimer
Forward-looking statements and disclaimer This presentation contains forward-looking statements within the meaning of the U.S. Private Securities Litigation Reform Act of 1995. These statements are generally identified by words such as “outlook,” “forecast,” “projected,” “could,” “expects,” “will” a
Slide 10: The Visa Spending Momentum Index is a new way to gauge consumer spending
The Visa Spending Momentum Index is a new way to gauge the health of consumer spending—and overall participation by consumers in the recovery A data sample pulled from the Visa network*… to track upturns and downturns in spending and better track the economic recovery Current Data 1 The SMI leverage
Slide 11: Diffusion index: basic calculation framework
Diffusion index: basic calculation framework Hypothetical month using U.S.-issued Visa credentials Example: 100 million credentials remain after filtering and are used in the index as follows Expansion 52 million cards with greater spending 200 Index value for hypothetical month 4 million cards with
Slide 12: SMI fills an important gap in tracking consumer spending momentum
SMI fills an important gap in tracking and monitoring the overall momentum of consumer spending What is it? Tracks U.S. retail sales more closely than other popular indices* • Measures the share of a sample of depersonalized credit and debit cardholders who have increased their monthly spending comp
Slide 13: SMI captures momentum better than other metrics
SMI captures momentum better than other metrics April 2020 – Retail sales vs. SMI by state 1. Looking back to April 2020, retail sales growth was at its State Retail Sales (YoY) SMI worst across the United States during the peak lockdown. Colorado -20.0 68.7 2. These three states and D.C. suffered s
Slide 14: U.S. consumer spending momentum ended 2021 on a high note
U.S. consumer spending momentum ended 2021 on a high note (>100 = Expansion, <100 = Contraction) Last actual: December 2021 140 Expansion 130 Standard U.S. SMI (YoY) 120 Pandemic Adj. SMI 110 (relative to 2019) 100 Contraction 90 80 70 2008 2011 2014 2018 2021 Even with a slight dip downwards as the
Slide 15: Risk from Omicron Variant is contained
Risk from Omicron Variant is contained as each successive wave has had less of an impact on spending SMI COVID-19 Active Outbreaks Australia United Kingdom United States 150 150 150 100 100 100 50 50 50 Mar-20 Oct-20 May-21 Dec Mar-20 Oct-20 May-21 Dec Mar-20 Oct-20 May-21 Dec New Zealand Ireland Ca
Slide 16: As the pandemic recedes, old patterns are re-emerging
As the pandemic recedes, old patterns are re-emerging SMI in five countries by population-size Contribution to payments growth by imputed affluence (percent change relative to same week in 2019, CAGR, LCU) 140 30% Total Top 50 global Other cities High 120 Small cities (under 500K pop) 100 0% 80 60 -
Slide 17: Access the SMI and our latest economic forecast and views
Access the SMI and our latest economic forecast and views Visa.com/EconomicInsights or @VisaChiefEcon Or subscribe at: globalclient.visa.com/visaeconomicnews Keep up with the latest developments in consumer spending trends 18 ©2022 Visa Confidential. All rights reserved.
Slide 18: Consumer Credit Trends and Insights
Consumer Credit Trends and Insights Tom Aliff Equifax PROPRIETARY | 19
Slide 19: First mortgage and auto originations
First Mortga ge origin a tion s we re 14.2% h igh e r th a n 2020 le ve ls a n d su b p rim e sh a re h a s d e cre a se d sign ifica n tly; Au to YTD o rigin a tio n s a re ru n n in g a t h istoric h igh s, a n d su b p rim e sh a re h a s d ro p p e d fro m 2018-2020 le ve ls. First Mortgage Orig
Slide 20: Bankcard limit and unit originations
Nove m b e r Ye a r to Da te Ba n kca rd $ lim it o rigin a tio n s re m a in e d b e low p re - p a n d e m ic le ve ls; su b p rim e sh a re h a s b e e n gro win g ste a d ily (le ft), b u t # of n e w ca rd s origin a te d Nove m b e r YTD is a b o ve 2019 le ve ls (righ t) Bankcard $ Limit Orig
Slide 21: Private label card originations
Nove m b e r Ye a r to Da te Priva te La b e l $ lim it (le ft) a n d u n it (righ t) origin a tion s re m a in e d b e low p re -p a n d e m ic le ve ls, b u t we ll a b o ve 2020; su b p rim e sh a re re m a in s ste a d y. Private Label Card $ Limit Originations Private Label Card Unit Originatio
Slide 22: Mortgage and non-mortgage debt increase
Mo rtga ge De b t h a s in cre a se d b y $2.5T sin ce Ma rch 2013; No n - Mo rtga ge De b t in cre a se d b y 1.6T, d ro p p e d b a ck in 2020, a n d is n o w b a ck a b o ve p re -p a n d e m ic le ve ls. Mortgage Debt Non -Mortgage Debt First Mortga ge , Hom e Eq u ity Lin e s a n d Loa n s; Au
Slide 23: Revolving and non-revolving debt
Afte r gro win g fro m 2011-2019, Re vo lvin g De b t d ro p p e d $170B fro m th e 2019 h igh , b u t is co n tin u in g to re co ve r slo wly; No n -Re vo lvin g De b t h a s co n tin u e d to gro w b u o ye d b y stro n g Au to a n d Alt-Fi le n d in g. Revolving Debt Non -Revolving Debt Ba n kca
Slide 24: Credit limits and utilization
Cre d it Lim its a n d Utiliza tio n h a ve sta rte d to slo wly in cre a se fo r b o th Ba n kca rd a n d Priva te La b e l Ca rd ; Ho m e Eq u ity Lin e u tiliza tio n co n tin u e s to d e cre a se . Credit Limits and Utilization Rates Bankcard Private Label Card Revolving Home Equity Cre d it Li
Slide 25: Severe delinquency rates
De lin q u e n cie s on Au to a re fo llo win g co n siste n t se a so n a l p a tte rn s a n d le ve ls; Ba n kca rd a n d Priva te La b e l d e lin q u e n cie s a re b e lo w p re -p a n d e m ic le ve ls; First Mortga ge d e lin q u e n cie s re m a in a t h isto ric lo ws Severe Delinquency Rat
Slide 26: Loans in Possible Accommodation
Lo a n s in Po ssib le Acco m m o d a tio n As o f Se p te m b e r 28, 2021, lo a n s u n d e r a ccom m od a tion re m a in b e low p re viou s h igh s. Across a ll a ccou n t typ e s e xclu d in g Stu d e n t Loa n , a tota l of 1.9% a re u n d e r PA vs. 1.5% on Ma rch 3, 2020. Stu d e n t Lo a n
Slide 27: Pre and Post COVID originations by consumer credit tier
Pre a n d Po st COVID Origin a tio n s Sh o w: An Ad d itio n a l 20% of Consumer Previously Having Deep Subprime Credit a n d 16% of Consumers Previously Having Subprime Credit Origin a te d a t a High e r Ba n d Source: Equifax: www.equifax.com/business/market-pulse-credit-trends PROPRIETARY | 28
Slide 28: Small Business Data and Insights
Small Business Data and Insights Sarah Briscoe Equifax PROPRIETARY | 29
Slide 29: Small Business Lending Index (SBLI)
Sm a ll Bu sin e ss Lending Index (SBLI) PROPRIETARY | 30
Slide 30: Small Business Lending Index (SBLI)
SMALL BUSINESS LENDING INDEX (SBLI) JANUARY 2005–NOVEMBER 2021 PROPRIETARY | 31
Slide 31: SBLI year-over-year change
SBLI YEAR-OVER-YEAR CHANGE NOVEMBER 2021 VS. NOVEMBER 2020 PROPRIETARY | 32
Slide 32: SBLI year-over-year change: accommodation and food services
SBLI YEAR-OVER-YEAR CHANGE ACCOMMODATION AND FOOD SERVICES, NOVEMBER 2021 VS. NOVEMBER 2020 PROPRIETARY | 33
Slide 33: SBLI year-over-year change: retail trade
SBLI YEAR-OVER-YEAR CHANGE RETAIL TRADE, NOVEMBER 2021 VS. NOVEMBER 2020 PROPRIETARY | 34
Slide 34: SBLI national by industry
SBLI NATIONAL BY INDUSTRY NOVEMBER 2021 VS. NOVEMBER 2020 PROPRIETARY | 35
Slide 35: Small Business Delinquency Index (SBDI)
Sm a ll Bu s in e s s Delinquency Index (SBDI) PROPRIETARY | 36
Slide 36: Small Business Delinquency Index (SBDI) 31-90%
SMALL BUSINESS DELINQUENCY INDEX (SBDI) 31-90% JANUARY 2005–NOVEMBER 2021 PROPRIETARY | 37
Slide 37: SBDI 31-90% year-over-year change
SBDI 31-90% YEAR-OVER-YEAR CHANGE JANUARY 2006–NOVEMBER 2021 PROPRIETARY | 38
Slide 38: SBDI 31-90% index values
SBDI 31-90% INDEX VALUES NOVEMBER 2021 PROPRIETARY | 39
Slide 39: SBDI 31-90% national by industry
SBDI 31-90% NATIONAL BY INDUSTRY JANUARY 2005–NOVEMBER 2021 PROPRIETARY | 40
Slide 40: SBDI 31-90% national by industry, Nov 2021 vs Nov 2020
SBDI 31-90% NATIONAL BY INDUSTRY NOVEMBER 2021 VS. NOVEMBER 2020 PROPRIETARY | 41
Slide 41: Small Business Default Index (SBDFI)
Sm a ll Bu s in e s s Default Index (SBDFI) PROPRIETARY | 42
Slide 42: Small Business Default Index (SBDFI)
SMALL BUSINESS DEFAULT INDEX (SBDFI) JANUARY 2005–NOVEMBER 2021 PROPRIETARY | 43
Slide 43: SBDFI year-over-year change
SBDFI YEAR-OVER-YEAR CHANGE JANUARY 2006–NOVEMBER 2021 PROPRIETARY | 44
Slide 44: SBDFI index values
SBDFI INDEX VALUES NOVEMBER 2021 PROPRIETARY | 45
Slide 45: SBDFI national by industry
SBDFI NATIONAL BY INDUSTRY NOVEMBER 2021 VS. NOVEMBER 2020 PROPRIETARY | 46
Slide 46: Q&A
Q&A The opinions, estimates and forecasts presented herein are for general information use only. This material is based upon information that we consider to be reliable, but we do not represent that it is accurate or complete. No person should consider distribution of this material as making any rep
Slide 47: Market Pulse Webinar & Podcast Series
Market Pulse Webinar & Podcast Se rie s Register to Attend: Listen Now: PROPRIETARY | 48
Slide 48: Thank You
Thank You Market Pulse: Planning the Future from Today’s Consumer Spending Visit us online today at equifax.com/marketpulse PROPRIETARY | 49