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The composite delinquency ratio of closed-end installment loan categories reached a record high of 3.35% of all seasonally adjusted accounts in the second quarter, according to a report by the American Bankers Association.

"Six consecutive quarters of job losses have taken their toll. With jobs lost and work hours cut, it doesn't take long for the financial pressure to become overwhelming," James Chessen, the ABA association's chief economist, said of the report's findings. "Falling behind on debt payments is an unfortunate side effect of high unemployment and a frozen job market. The picture won't change until the labor market improves and the economy picks up steam."

The Q2 ratio, which tracks eight loan types such as credit card, auto and home-equity, was 12 basis points higher than the 3.23% in the previous quarter, the report states. The association's report defines delinquencies as payments at least 30 days past due.

Although credit card delinquencies increased, auto loan delinquencies improved during the second quarter, according to the report. Credit card delinquencies rose to 5.01% of total loans during the second quarter, from 4.75% in the previous quarter.

Direct auto loan delinquencies decreased to 2.46% in the second quarter from 3.01% in the previous quarter, and indirect auto loan delinquencies decreased to 3.26%, from 3.42% in the first quarter. Home equity loan delinquencies rose to 4.01% from 3.52%, according to the report.

"The good news is that consumers are clearly being more cautious by saving more, spending less and making great efforts to repair their balance sheets," Chessen said.

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