Experian/Moody's Analytics Small Business Credit Index - Q4 2012
Tags: Business Information, Risk Management
The Experian/Moody's Analytics Small Business Credit Index tracks how businesses are faring over a period of time compared with a base point, with the first quarter of 2011 being equal to 100. The key factors that comprise the index are commercial credit data (including growth of credit balances and delinquency rates measured on a dollar basis) combined with a variety of macroeconomic data (including growth rates for employment, income, retail sales, investment, output and industrial production).
Small business credit quality continued to deteriorate in the fourth quarter as the Experian/Moody's Analytics Small Business Credit Index dropped 6.8 points to land at 97.3, its lowest reading during our observation period. The index was driven lower by a slowdown in personal income growth and an increase in delinquent balances, which kept retail sales in check and drove small business revenues lower. Over the next few months, small companies will face setbacks as buyers adjust to smaller paychecks and hiring is quelled by political uncertainty, but credit quality is expected to improve by year's end and going into 2014.