As consumers in the U.S. take out more loans and credit card debt reaches record levels, credit card losses for issuers have climbed in an “unusual rise” that could continue for at least another year, according to Goldman Sachs analysts.

At 3.63%, credit card losses are up 1.5 percentage points from a low reached in September 2021, and have grown since the first quarter of 2022 at the fastest pace in close to three decades, outside of the Global Financial Crisis, according to Goldman Sachs.

“It is unusual for losses to rise outside of an economic downturn,” Goldm💟an Sachs analyst Ryan Nash said in a note Friday.

Three of the past five credit card loss cycles were during 澳洲幸运5官方开奖结果体彩网:recessions, including the early 1990s, 澳洲幸运5官方开奖结果体彩网:the early 2000s, and the 澳洲幸运5官方开奖结果体彩网:2008 Great Recession. Th𝔉e other two were in the mid-90s and 2015 to 2019. 

“This cycle resembles the characteristics of what was experienced in the late 1990s and somewhat similar to the ‘15 to ‘19 cycle where losses increase following a period of strong loan growth and has seen similar pace of normalization thus far this cycle," Nash noted.

Loans have grown 22% year-over-year, up from an annual rate of -13% a year ago, and credit card debt reached a record high, with Americans owing more than $1 trillion in the second quarter of 2023, according to Federal Reserve data.

Goldman Sachs expects credit card losses could rise to 4.93% and peak in late 2024 or early 2025 for most issuers. Relative to expectations, Goldman Sachs said it anticipates the highest losses at Capital One () and Discover (DFS), but projected losses for Synchrony (SYF) and American Express (AXP) to increase into 2025.