What is the main purpose of this 8-K filing?

The main purpose of this 8-K filing is to provide investors with updated, periodic statistics on the delinquency and net write-off rates for American Express's U.S. Consumer and U.S. Small Business Card Member lending portfolios. It also includes information on the credit performance of the American Express Credit Account Master Trust.

Are there any signs of increasing credit risk in American Express's portfolios based on this data?

Based on the data provided for the three months ending September, October, and November 2018, credit risk appears to be stable. Delinquency rates for both consumer and small business segments remained consistent or showed only minor increases, and net write-off rates were also steady, indicating no significant deterioration in credit quality during this period.

What is the difference between the data reported for the Card Member portfolios and the Lending Trust?

The data reported for the Card Member portfolios includes both securitized and non-securitized loans, using average loan balances for write-off calculations. The Lending Trust data pertains only to securitized receivables and may differ due to variations in loan characteristics, vintage, aging, and calculation methodologies (e.g., using end-of-period balances for write-offs in the Trust). The filing explicitly notes these differences can lead to month-to-month variations in reported credit performance.

What caused the jump in the Lending Trust's ending principal balance in October 2018?

The significant increase in the Lending Trust's ending total principal balance in October 2018 was due to the acquisition of approximately $8 billion of receivables from additional accounts by the Trust on October 1, 2018. This event also led to an update in the previously reported figures to correct a typographical error.

AXP 8-K: Regulation FD — Dec 17, 2018

Summary

This 8-K filing from American Express (AXP) provides updated delinquency and write-off statistics for its U.S. Consumer and U.S. Small Business Card Member lending portfolios for the months ending September 30, October 31, and November 30, 2018. The report indicates stable credit performance across both segments, with 30-day past due rates remaining consistent and net write-off rates showing only minor fluctuations. This consistent performance suggests a stable credit environment for American Express's loan portfolios during this period. The filing also includes information on the American Express Credit Account Master Trust, which holds securitized receivables. While the overall trends in delinquency and write-offs for the direct portfolios are steady, the data for the securitized trust shows a slightly higher ending principal balance in October due to an acquisition of receivables, and its annualized default rates are within a narrow band. Investors should note that the Trust's data may differ from the direct portfolios due to differences in loan characteristics and calculation methodologies.

Key Highlights

1Stable 30-day delinquency rates for U.S. Consumer Card Member loans at 1.4% for September, October, and November 2018.
2Net write-off rate for U.S. Consumer Card Member loans remained steady at 2.0% for the reported three-month period.
3U.S. Small Business Card Member loans showed a 30-day delinquency rate of 1.2% in September and October, increasing slightly to 1.2% in November.
4Net write-off rate for U.S. Small Business Card Member loans was 1.5% in September and 1.6% in October and November, indicating minimal credit deterioration.
5Total Card Member loans for the U.S. Consumer and U.S. Small Business segments grew from $68.1 billion in September to $70.4 billion in November.
6The American Express Credit Account Master Trust reported a significant increase in its ending total principal balance in October 2018 due to an acquisition of approximately $8 billion in receivables.
7Annualized default rates for the Lending Trust remained low, ranging from 1.0% to 1.3% for the reported periods.

AMERICAN EXPRESS CO 8-K Report, Regulation FD Disclosure (Dec 17, 2018)

Summary

Key Highlights

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