Summary
This 8-K filing from American Express Co. (AXP) on April 15, 2015, provides an update on the credit performance of its U.S. Card Services (USCS) operating segment, specifically focusing on delinquency and write-off statistics for the lending portfolio for the months of January, February, and March 2015, as well as the first quarter of 2015. The report details key credit metrics such as total loans, 30-day past due loans, and net write-off rates.
Key Highlights
- 1The U.S. Card Services (USCS) lending portfolio showed stable delinquency rates, with 30 days past due loans consistently at 1.0% of total loans throughout the reported periods (January-March 2015).
- 2The net write-off rate for the USCS lending portfolio was 1.4% for January 2015 and 1.5% for February and March 2015, indicating a slight increase but remaining within a relatively narrow band.
- 3A change in the timing of charge-offs for certain loan modification programs, from 180 days past due to 120 days past due, was implemented starting January 16, 2015. This change impacted the reported write-off rates.
- 4Excluding the impact of the charge-off timing change, the net write-off rate for the USCS portfolio would have been 1.3% for January 2015 and 1.4% for the first quarter of 2015, suggesting slightly better underlying performance without the accounting adjustment.
- 5The filing also provides credit performance data for the American Express Credit Account Master Trust (Lending Trust), showing a consistent total of $0.3 billion in 30+ days delinquent loans across its reporting periods.
- 6The Lending Trust's annualized default rate, net of recoveries, was 1.4% for the period ending January 25, 2015, increased to 1.7% for the period ending February 22, 2015, and returned to 1.4% for the period ending March 25, 2015.
- 7The report clarifies that the USCS total portfolio statistics may differ from the Lending Trust's reported data due to differences in loan mix, securitization status, and calculation methodologies.