Asset Quality
Past-Due Loans
Also known as Past Due
Past-due loans are loans behind on their contractual payments, reported in 30-89 day and 90+ day buckets. The early (30-89 day) bucket is a leading indicator of credit problems before loans slip into nonaccrual.
How is Past-Due Loans calculated?
Schedule RC-N reports delinquency by bucket. The 30-89 day bucket flags emerging stress; the 90+ day still-accruing bucket is more serious and usually precedes a move to nonaccrual.
Why does Past-Due Loans matter?
Delinquency is the earliest hard data on credit deterioration. A rising 30-89 day bucket often shows up quarters before charge-offs climb, making it one of the most useful forward-looking asset-quality signals an analyst has.
How do you interpret Past-Due Loans?
Watch the early-delinquency bucket as a share of loans and its trend. A sustained rise in 30-89 day past-dues is a warning the loan book is turning, even while nonaccruals and charge-offs still look benign.
What do Past-Due Loans levels indicate?
| Range | Label | Interpretation |
|---|---|---|
| < 0.5% of loans | Strong | Very low delinquency. |
| 0.5-1.5% | Adequate | Normal delinquency for most books. |
| 1.5-3% | Watch | Rising delinquency; credit softening. |
| > 3% of loans | Concern | High delinquency pointing to looming charge-offs. |
Worked example
Frequently asked
Why separate 30-89 day from 90+ day past-due loans?
The 30-89 day bucket is an early, often-curable stage of delinquency and a leading indicator. The 90+ day bucket is more serious and usually transitions to nonaccrual, so the two carry different risk weight in analysis.
Are past-due loans the same as nonperforming loans?
Not exactly. Nonperforming loans are generally nonaccrual loans plus those 90+ days past due and still accruing. Early-stage 30-89 day past-dues are delinquent but not yet classified nonperforming.
Sources
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