NEW YORK - SOARING US unemployment and a shrinking economy drove delinquencies on credit card debt and home equity loans to all-time highs in the first quarter as a record number of cash-strapped consumers fell behind on their bills.

Delinquencies on the value of all card debt soared to a record 6.60 per cent from 5.52 per cent in the fourth quarter as more cardholders relied on plastic to meet day-to-day expenses, the American Bankers Association said.

Late payments on home equity loans rose to 3.52 per cent from 3.03 perc ent, and on home equity lines of credit climbed to 1.89 per cent from 1.46 per cent.

A broader gauge showing late payments on eight categories of loans rose for a fourth straight quarter to a new record, edging up to 3.23 per cent from 3.22 perc ent. That rate actually understates consumer pain because it excludes credit cards. The ABA tracks loan payments that are at least 30 days late.

'The biggest driver is job losses,' ABA Chief Economist James Chessen said in an interview. 'When people lose their jobs or work fewer hours, it makes it that much harder to meet their obligations. Unfortunately, we're going to see higher job losses in the next year, and I expect elevated delinquencies.'

The ABA represents most large US banks and credit card companies. Tuesday's data are a bad sign for them as they prepare to report second-quarter results starting next week.

While improved capital markets may boost the bottom lines of some, analysts expect lenders such as Bank of America, JPMorgan Chase, Citigroup, Capital One Financial and American Express to suffer higher credit losses, especially in cards.

Borrowers are struggling as the nation's jobless rate sits at a 26-year high of 9.5 per cent, with 6.5 million jobs having disappeared since the recession began in December 2007. The Obama administration expects the unemployment rate to hit double digits before declining.

US consumers ended March with US$939.6 billion (S$1.41 trillion) of revolving credit outstanding, a rough approximation of credit card debt, according to Federal Reserve data.

'Consumers tend to rely on credit cards as a bridge to cover their daily needs until they find new jobs,' Mr Chessen said. 'It's taking longer to find those jobs.'

Meanwhile, home prices are down 32.6 per cent from their peak in 2006, according to the Standard & Poor's/Case-Shiller Home Price Indices of 20 large metropolitan areas. -- REUTERS