8-KRegulation FD

AMERICAN EXPRESS CO 8-K Report, Regulation FD Disclosure (Aug 15, 2017)

Filed August 15, 2017For Securities:AXP

Summary

This 8-K filing from American Express Company (AXP) provides updated credit performance statistics for its U.S. Consumer Services (USCS) and U.S. Small Business Card Member lending portfolios for the months ending May 31, June 30, and July 31, 2017. The report aims to give investors a more granular view of the company's credit quality beyond what is reported in the American Express Credit Account Master Trust's (Lending Trust) 10-D filings. Key metrics disclosed include 30-day delinquency rates and net write-off rates for both consumer and small business segments. Overall, the presented data indicates stable credit performance during the period. Delinquency rates remained consistent, and while write-off rates showed some minor fluctuations, they stayed within expected ranges. The company also provided specific data for the Lending Trust, noting that its performance may differ from the overall portfolios due to various factors like loan mix, vintage, and calculation methodologies.

Key Highlights

  • 1American Express is providing updated delinquency and write-off statistics for its U.S. Consumer Services and U.S. Small Business Card Member lending portfolios.
  • 2The data covers the monthly periods ending May 31, June 30, and July 31, 2017.
  • 3For U.S. Consumer Services (USCS), 30-day delinquency rates remained stable at 1.1% for May and June, increasing slightly to 1.2% in July. The net write-off rate fluctuated between 1.7% and 1.8%.
  • 4For U.S. Small Business, 30-day delinquency rates were consistently 1.1%. The net write-off rate increased from 1.5% in May to 1.9% in July.
  • 5Total U.S. Consumer and Small Business Card Member loans grew from $58.5 billion to $59.3 billion over the period.
  • 6The filing also includes credit performance data for the American Express Credit Account Master Trust (Lending Trust), showing a stable annualized default rate (net of recoveries) between 1.3% and 1.4% for the period.

Frequently Asked Questions

The primary purpose of this 8-K filing is to provide investors with updated, specific credit performance statistics for American Express's U.S. Consumer Services and U.S. Small Business Card Member lending portfolios for the months ending May 31, June 30, and July 31, 2017. This information supplements the data already reported in the company's regular SEC filings.

No, the statistics for the U.S. Consumer Services and U.S. Small Business Card Member loan portfolios include both securitized and non-securitized loans. However, the filing explicitly states that these may not have identical characteristics to loans held within the American Express Credit Account Master Trust (Lending Trust), and the reported credit performance of the Lending Trust might differ due to various factors.

The trends presented suggest stable to slightly increasing credit risk. While 30-day delinquency rates remained relatively consistent, the net write-off rate for the U.S. Small Business segment saw a noticeable increase from 1.5% to 1.9% over the three months. The U.S. Consumer Services write-off rate remained steady around 1.8%. Investors should monitor these trends closely in future filings.

The filing notes that the Lending Trust's metrics may differ from the overall portfolios. For the period presented, the Lending Trust showed a stable annualized default rate between 1.3% and 1.4%, with 30+ days delinquent amounts holding steady at $0.2 billion. This suggests potentially better performance within the securitized pool compared to the overall U.S. Small Business portfolio's write-off rate in July, though direct month-over-month comparisons can be affected by calculation differences and loan mix.