How have the credit metrics for U.S. Consumer Card Member loans trended?

The 30-day past due rate for U.S. Consumer Card Member loans remained stable at 1.0% throughout the reported periods. However, the net write-off rate (principal only) showed a positive trend, decreasing from 1.9% for the month ended November 30, 2020, to 1.6% for December 2020, and further down to 1.3% for January 31, 2021, indicating improving credit quality.

What are the key credit performance indicators for the American Express Credit Account Master Trust?

For the American Express Credit Account Master Trust, the filing shows a declining trend in the annualized default rate, net of recoveries. This rate decreased from 1.6% for the period ended November 30, 2020, to 1.2% for December 2020, and further to 1.1% for the period ended January 31, 2021. The 30+ days delinquent amount remained stable at $0.2 billion across the three periods.

Why does American Express provide these specific loan portfolio statistics separately from their 10-D filings?

American Express provides these statistics because the loans securitized through the Lending Trust may not have identical characteristics to their total U.S. Consumer or U.S. Small Business Card Member loan portfolios. The differences in loan mix, vintage, aging, and calculation methodologies (e.g., average loan balances vs. end-of-period balances) can lead to variations in reported credit performance. Providing these direct portfolio statistics gives investors a clearer, more consolidated view of credit trends within these specific segments.

AXP 8-K: Regulation FD — Feb 16, 2021

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

The main purpose of this 8-K filing is to provide investors with current statistics on the delinquency and write-off rates for American Express's U.S. Consumer and U.S. Small Business Card Member lending portfolios, as well as for the American Express Credit Account Master Trust, for the months ending January 31, 2021, December 31, 2020, and November 30, 2020. This information is furnished under Regulation FD to supplement publicly available data.

Summary

This 8-K filing from American Express (AXP) provides an update on key credit performance metrics for its U.S. Consumer and U.S. Small Business Card Member lending portfolios, as well as for the American Express Credit Account Master Trust. The data covers the periods ending January 31, 2021, and compares it to December 31, 2020, and November 30, 2020. This information is supplementary to the data reported in their regular 10-D filings and offers investors a more direct look at credit trends within these specific lending segments.

Key Highlights

1The filing discloses delinquency and write-off rate statistics for U.S. Consumer and U.S. Small Business Card Member lending portfolios.
2For U.S. Consumer Card Member loans, 30-day past due rates remained stable at 1.0% across the reported periods (Jan 31, 2021, Dec 31, 2020, Nov 30, 2020).
3Net write-off rates for U.S. Consumer Card Member loans showed a downward trend, decreasing from 1.9% in November 2020 to 1.3% in January 2021.
4U.S. Small Business Card Member loans maintained a 30-day past due rate of 0.7% in January and December 2020, slightly increasing from 0.8% in November 2020.
5The net write-off rate for U.S. Small Business Card Member loans also improved, decreasing from 2.3% in November 2020 to 1.4% in January 2021.
6The filing also presents credit performance data for the American Express Credit Account Master Trust, showing a declining annualized default rate, net of recoveries, from 1.6% in November 2020 to 1.1% in January 2021.
7This data provides timely insights into credit quality and potential credit losses for American Express, particularly relevant in the economic climate of early 2021.

AMERICAN EXPRESS CO 8-K Report, Regulation FD Disclosure (Feb 16, 2021)

Summary

Key Highlights

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