UPDATE: Capital One: Credit-Card Delinquencies, Charge-Offs Fall in May

(Updates to include lowest charge-offs, delinquencies since 2007 in second paragraph)

Capital One Financial Corp. (COF) said credit card charge-offs and delinquencies continued to decline for a sixth straight month in May, though they turned higher for auto-finance credit.

The month saw the lowest rates for U.S. credit-card charge-offs and delinquencies since 2007.

U.S. charge-offs--loans banks don't expect to be able to collect--fluctuated near the end of last year after mostly dropping in the early months of 2010. The U.S. credit-card industry is wrestling with a slow recovery as losses from souring loans remain high.

Net charge-offs in May edged down to 4.84% from 4.97% a month earlier at Capital One's U.S. card business and to 6.84% from 7.06% internationally, according to a filing with the Securities and Exchange Commission. However, auto-finance charge-offs edged up to 0.9% from 0.84%.

At the company's U.S. credit-card business, 30-day delinquencies fell to 3.32% from 3.41% a month earlier and to 5.43% from 5.51% internationally. The auto-loan 30-day delinquency rate increased to 6.35% from 5.84%.

The card-issuer-turned-bank has seen financial results improve of late and reported in April its first-quarter earnings rose 60% as the company set aside significantly less for loan losses, boosting the bottom line.

Shares closed Tuesday at $48.43 and were inactive premarket.

-By Tess Stynes, Dow Jones Newswires; 212-416-2481; [e-mail]