Always tough to guess underwriting policies from outside the building but I think that increasingly good, integrated IT systems and faster decision loops is causing some banks to try to get cozier with some customers than previously.
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One of the reasons the FICO/credit report system works is that banks want to know what your total exposure is and, historically, they wanted to avoid having it concentrated on them. This limits damage from a strategic default in event of a "bust out" situation.
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I just opened 3rd card with a particular US megabank which is very aggressively trying to grow credit portfolio, and they were happy to increase their aggregate exposure to me to
$SILLY, where they were concerned about that a few years ago.1 reply 0 retweets 9 likesShow this thread -
I assume that part of the calculus is "Well if we give you $20k on Card C that doesn't *really* commit us to an extra $20k of risk because if you were to saturate your limit on Card A then we'd dynamically lower limits on C before you were able to type in B's digits to borrow."
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Replying to @patio11
How does that grow their credit portfolio though? People more likely to use some of a lot rather than all of less?
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Replying to @jaredmckiernan
I think they've bucketed me as "Uses credit cards as a payment method lots, uses them as a financial instrument infrequently but materially over 10+ year timescale" and so keeping/increasing share-of-wallet is pretty important versus losing it to a new card from another bank.
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Replying to @patio11 @jaredmckiernan
What qualifies as ‘financial instrument’ usage?
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I meant “keeping a revolving balance.”
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