8-KRegulation FD

AMERICAN EXPRESS CO 8-K Report, Regulation FD Disclosure (Apr 15, 2019)

Filed April 15, 2019For Securities:AXP

Summary

This 8-K filing from American Express (AXP) provides a snapshot of key credit performance metrics for its U.S. Consumer and U.S. Small Business Card Member lending portfolios as of and for the periods ending January 31, February 28, and March 31, 2019. Investors can find preliminary data for March 2019 and the first quarter of 2019, which offers insights into the company's asset quality and risk management. The data indicates stable delinquency rates and a slight upward trend in net write-off rates for the U.S. Consumer portfolio in the first quarter of 2019, while the U.S. Small Business portfolio showed more consistent performance. The filing also includes separate credit performance data for the American Express Credit Account Master Trust, which is securitized, and clarifies how this data may differ from the broader loan portfolios. Overall, the report offers transparency into American Express's credit exposure and its trends.

Key Highlights

  • 1Preliminary U.S. Consumer Card Member loans totaled $58.0 billion as of March 31, 2019.
  • 2U.S. Consumer 30-day past due loans remained stable at 1.5% across the reported periods.
  • 3The net write-off rate for U.S. Consumer Card Member loans increased slightly to 2.5% for the three months ended March 31, 2019, up from 2.4% in February and 2.2% in January.
  • 4U.S. Small Business Card Member loans stood at $12.7 billion as of March 31, 2019.
  • 5U.S. Small Business 30-day past due loans held steady at 1.3% throughout the reported months.
  • 6The net write-off rate for U.S. Small Business Card Member loans was consistent at 1.8% or 1.9% for the periods presented.
  • 7Data for the American Express Credit Account Master Trust shows an increasing annualized default rate, net of recoveries, from 1.2% in January to 1.6% in March 2019.

Frequently Asked Questions

The main purpose of this 8-K filing is to provide investors with current information on the credit quality of American Express's U.S. Consumer and U.S. Small Business Card Member loan portfolios. It discloses delinquency and write-off statistics for specific periods, offering transparency into the company's asset performance.

No, the filing provides statistics for the U.S. Consumer Card Member lending portfolio and the U.S. Small Business Card Member lending portfolio. It also includes separate data for the American Express Credit Account Master Trust, which represents securitized loans. The company notes that the characteristics of loans in the Lending Trust may differ from the broader portfolios.

For the U.S. Consumer portfolio, 30-day delinquency rates remained stable at 1.5%, but the net write-off rate saw a slight increase to 2.5% for the first quarter of 2019. For the U.S. Small Business portfolio, delinquency remained stable at 1.3%, and net write-off rates were consistently around 1.8-1.9%.

The data for the American Express Credit Account Master Trust offers a view into the performance of securitized loans. Investors should note that this trust's credit performance, including its annualized default rate (which increased to 1.6% in March 2019), may not directly mirror the performance of the company's total loan portfolios due to differences in loan mix, vintage, and calculation methodologies.