8-KRegulation FD

AMERICAN EXPRESS CO 8-K Report, Regulation FD Disclosure (Jun 15, 2018)

Filed June 15, 2018For Securities:AXP

Summary

This 8-K filing by American Express Co. (AXP) on June 15, 2018, provides investors with updated delinquency and write-off statistics for its U.S. Consumer Services (USCS) and U.S. Small Business Card Member lending portfolios for the months ending March 31, April 30, and May 31, 2018. These figures offer a snapshot of the company's credit quality and risk management for its lending operations. Key metrics presented include total loan balances, 30-day past due percentages, and net write-off rates. The filing also includes comparable data for the American Express Credit Account Master Trust, which is used for securitization. Investors can use this information to assess trends in credit performance and potential impacts on future earnings, as credit quality is a crucial factor for financial institutions like American Express.

Key Highlights

  • 1American Express is providing updated credit performance data for its U.S. Consumer Services and U.S. Small Business lending portfolios.
  • 2The data covers delinquency and write-off rates for the months of March, April, and May 2018.
  • 3For U.S. Consumer Services, 30-day past due rates remained stable at 1.3% in April and May 2018, after being 1.4% in March 2018.
  • 4Net write-off rates for U.S. Consumer Services were 2.2% in March and May 2018, with a slight increase to 2.3% in April 2018.
  • 5For U.S. Small Business, 30-day past due rates were stable at 1.2% in April and May 2018, down from 1.3% in March 2018.
  • 6Net write-off rates for U.S. Small Business were 1.9% in April and May 2018, consistent with March 2018.
  • 7Supplemental data for the American Express Credit Account Master Trust (a securitization vehicle) shows annualized default rates generally between 1.5% and 1.7%.

Frequently Asked Questions

This 8-K filing discloses monthly statistics on loan balances, 30-day past due rates, and net write-off rates for American Express's U.S. Consumer Services and U.S. Small Business lending portfolios for March, April, and May 2018. It also provides related data for the American Express Credit Account Master Trust.

The data shows relatively stable credit performance during the reported period. For U.S. Consumer Services, 30-day past due rates remained at 1.3% for April and May. Net write-off rates for both USCS and U.S. Small Business remained within a narrow range. Overall, there are no sharp deteriorations or improvements evident in these specific metrics over the three months.

The filing clarifies that the Card Member loans securitized through the Lending Trust may have different characteristics than the total USCS or U.S. Small Business portfolios. Differences in loan mix, vintage, aging, and calculation methodologies (e.g., using end-of-period balances vs. average balances for write-offs) can lead to variations in reported credit performance between the 10-D and these 8-K statistics.

The 'principal only' designation for the net write-off rate means that the calculation excludes any accrued interest or fees that might have been outstanding at the time of write-off. It focuses solely on the unrecovered principal amount of the loans.