8-KRegulation FD

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

Filed August 15, 2018For Securities:AXP

Summary

This 8-K filing from American Express (AXP) on August 15, 2018, provides investors with updated delinquency and write-off statistics for its U.S. Consumer and U.S. Small Business Card Member lending portfolios for the months ending May 31, June 30, and July 31, 2018. The data offers a snapshot of the company's credit performance in these key segments, supplementing information previously reported in the American Express Credit Account Master Trust's 10-D filings. Investors can use this information to assess the current health and risk profile of Amex's loan book. The reported statistics show relatively stable credit metrics across both the U.S. Consumer and U.S. Small Business portfolios. For the U.S. Consumer segment, 30-day delinquencies remained steady at 1.3%, while the net write-off rate saw a slight fluctuation but ended July at 2.2%. In the U.S. Small Business segment, 30-day delinquencies edged slightly lower to 1.1% in July, and the net write-off rate increased to 2.0% from 1.6% in June. The filing also provides data for the securitized Lending Trust, indicating stable annualized default rates and delinquency levels, which generally align with the broader portfolio trends.

Key Highlights

  • 1Provides updated delinquency and write-off statistics for U.S. Consumer and U.S. Small Business card member lending portfolios for May, June, and July 2018.
  • 2U.S. Consumer 30-day past due rate remained stable at 1.3% through July 2018.
  • 3U.S. Consumer net write-off rate was 2.2% for May and July, and 2.0% for June.
  • 4U.S. Small Business 30-day past due rate slightly decreased to 1.1% in July after being 1.2% in May and June.
  • 5U.S. Small Business net write-off rate increased to 2.0% in July, up from 1.6% in June and 1.9% in May.
  • 6Total U.S. Consumer and Small Business card member loans grew from $65.9 billion in May to $66.9 billion in July.
  • 7Securitized Lending Trust data shows stable annualized default rates (1.4%-1.5%) and 30+ day delinquencies ($0.2 billion) for the period.

Frequently Asked Questions

The primary purpose of this 8-K filing is to provide investors with current and timely delinquency and write-off statistics for American Express's U.S. Consumer Card Member and U.S. Small Business Card Member lending portfolios for the months of May, June, and July 2018. This information supplements publicly available data and offers insights into the company's credit risk management and portfolio health.

For the U.S. Consumer portfolio, the 30-day delinquency rate remained consistent at 1.3% throughout the reported period (May, June, July 2018). The U.S. Small Business portfolio saw a slight improvement, with the 30-day delinquency rate decreasing from 1.2% in May and June to 1.1% in July 2018.

The net write-off rates, which represent principal write-offs excluding interest and fees, show some variability. The U.S. Consumer portfolio's net write-off rate fluctuated between 2.0% and 2.2%. The U.S. Small Business portfolio experienced an increase in its net write-off rate, rising to 2.0% in July from 1.6% in June, suggesting a slight uptick in unrecoverable loan principal in that segment.

The filing notes that the loans in the American Express Credit Account Master Trust (Lending Trust) may have different characteristics than the overall U.S. Consumer and Small Business portfolios. However, the data presented for the Lending Trust (e.g., annualized default rates between 1.4%-1.5% and stable 30+ day delinquencies) generally aligns with the broader trends observed in the company's total loan portfolios, suggesting consistent credit performance across both securitized and non-securitized assets.