At press time last week, Moody's Investors Service reported its October credit card pool statistics, with trust excess spread reaching an all-time high of 7.69%, according to the rating agency.

Charge-offs came in at 6.37% compared to 5.39% during the same month last year, while delinquencies were at 5.3%, compared to 4.83% last October. This marks the ninth consecutive month that charge-offs have risen year-over-year, and the eleventh consecutive month that delinquencies have risen.

"Its a continuation of something that we've been saying for a couple of months now," said William Black, vice president and senior analyst at Moody's. "The falling interest rate environment has more than offset the deteriorating credit, so far."

Although the vast majority of credit card deals are floating-rate, and have benefited from a lower cost of funds, there are some higher yielding fixed-rate deals in less stellar shape.

For example, a fixed-rate Providian Financial deal (2000-1) recently hit an early amortization trigger due to thinning excess spread. However, as Moody's Black pointed out, not all fixed-rate deals are paying steep yields, depending largely on a variety of factors including vintage and issuer. Also, some deals are equipped with hedging instruments, such as interest rate swaps.

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