Summary
This 8-K filing from American Express (AXP) provides an update on delinquency and write-off statistics for its U.S. Consumer Card Member and U.S. Small Business Card Member lending portfolios for the months ending February 28, March 31, and April 30, 2021. The data indicates a positive trend with decreasing delinquency and net write-off rates across both consumer and small business segments as of April 30, 2021, compared to the prior two months. Specifically, the U.S. Consumer Card Member 30-day past due rate decreased from 1.0% in February to 0.8% in April, and the net write-off rate fell from 1.4% to 1.0% over the same period. Similarly, the U.S. Small Business segment saw its 30-day past due rate remain stable at 0.6% in February and March, then decrease to 0.5% in April, while the net write-off rate declined from 1.0% to 0.7%. This suggests improving credit quality and a potential reduction in credit losses for American Express during this period, which is a favorable sign for investors.
Key Highlights
- 1U.S. Consumer Card Member 30-day delinquency rate improved, decreasing from 1.0% at Feb 28, 2021, to 0.8% at April 30, 2021.
- 2U.S. Consumer Card Member net write-off rate (principal only) declined from 1.4% at Feb 28, 2021, to 1.0% at April 30, 2021.
- 3U.S. Small Business Card Member 30-day delinquency rate decreased from 0.6% at March 31, 2021, to 0.5% at April 30, 2021.
- 4U.S. Small Business Card Member net write-off rate (principal only) improved, falling from 1.0% at Feb 28, 2021, to 0.7% at April 30, 2021.
- 5Total Card Member loans (U.S. Consumer and Small Business) grew from $60.4 billion at Feb 28, 2021, to $62.1 billion at April 30, 2021.
- 6Data for the American Express Credit Account Master Trust (Lending Trust) also shows a downward trend in annualized default rates, from 1.2% in February to 0.8% in April.
- 7The filing clarifies that the Lending Trust data may differ from the total portfolio due to securitization characteristics and calculation methodologies.