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Credit card performance in Canada remains better than that in the United States and Britain, but continued to decline in the third quarter, Moody's Investors Service says.

Charge-off rates reached a record-high rate of 4.92 per cent in the third quarter, 60 per cent higher than a year earlier. However, the rates were only slightly higher than the 4.8 per cent seen in the second quarter.

The delinquency rate index also rose slightly, to 3.14 per cent, up from 3.10 per cent in the second quarter. The delinquency rate index measures the proportion of account balances for which monthly payment is more than 30 days past due. It's considered a harbinger for future trends in charge-offs, Moody's says.

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Charge-off rates were 10.91 per cent in the U.S. during the third quarter and 10.68 per cent in Britain.

"The state of the economy will dictate the pace and timing of any improvement in the credit card sector," Sumant Inamdar, a vice-president and senior analysts, said in a news release Friday. "In particular, the unemployment rate and bankruptcy filings-two key drivers of credit card performance-have demonstrated early signs of stabilization and therefore offer some hope card performance may soon make a turn for the better."

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