Question-and-Answer Session
Operator
Your first question will come from the line of Guy Moszkowski with Merrill Lynch.
Guy Moszkowski – Merrill Lynch
Good morning. I wanted to follow up on your discussion of consumer allowance for loan loss compared to the coincident write off rates. As you pointed out, although in the US you’re now slightly ahead in terms of allowances internationally you’re below.
And when I look at the page towards the end of the supplement which does it on a global basis, you’re about 10 basis points below your coincident loss rate in terms of your allowance. Your global allowance is 241 and your coincident loss is 250. Given some of the trends that we’re seeing I’m just wondering why you wouldn’t have wanted to bring that more in line or even ahead?
Gary Crittenden
Guy I’ll take the question, you know if you look at most card competitors that have businesses that are outside the US, you know card businesses outside the US, generally you find the loan loss reserve to be somewhat lower outside the US as it is in the US. And importantly for us if you look at the 90 day delinquencies in the card business or in our international card business or in our international retail banking business, the 90 day delinquencies are dead flat with a year ago, in fact they’re slightly better than they were a year ago.
So we feel that with the additional things that we’ve done in Mexico and India that we’ve properly captured you know the amount of reserves that we should have in that portfolio. And I think as you rightly pointed out, we feel very good about our overall level of reserves. We’ve taken very aggressive action as I’ve mentioned, you know we’ve added $8.7 billion to strengthen our reserves over the course of the last four quarters and feel good about our aggregate reserve position.
Guy Moszkowski – Merrill Lynch
And with respect to that international delinquency rate which as you correctly point out is very, very consistent, it doesn’t really seem to predict either very significant increases or decreases in the coincident loss rates and we did see that loss rate pop up on the international cards by a couple hundred basis points again this quarter on a 12 month lag basis or a coincident basis actually. So I was just wondering why you have as much faith as you do in the delinquency data to predict your long term losses.
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