Summary
This 8-K filing by American Express Co. (AXP) provides an update on key credit performance metrics for its U.S. Consumer and U.S. Small Business Card Member lending portfolios as of July 31, 2021, and for the preceding two months. The information is presented to offer additional insights beyond the data reported in the American Express Credit Account Master Trust's Form 10-D filings. For investors, the most crucial takeaway is the stability and low levels of delinquency and net write-off rates across both the U.S. Consumer and U.S. Small Business segments. The data indicates a consistent and robust credit performance, with 30-day past due rates remaining very low (0.4%-0.7%) and net write-off rates showing a downward trend for the Consumer segment. This suggests effective credit risk management by American Express during the reporting period.
Key Highlights
- 1U.S. Consumer Card Member loans showed a slight decrease in the net write-off rate from 1.1% in May to 0.7% in July 2021.
- 230 days past due rates for U.S. Consumer Card Member loans remained stable at 0.6% for June and July, down from 0.7% in May.
- 3U.S. Small Business Card Member loans maintained consistently low 30-day past due rates, at 0.4% for June and July, down from 0.5% in May.
- 4Net write-off rates for U.S. Small Business Card Member loans were also stable and low, at 0.5% to 0.6% over the three-month period.
- 5Total U.S. Consumer and Small Business Card Member loans increased from $65.3 billion in May to $67.1 billion in July 2021.
- 6The American Express Credit Account Master Trust reported a consistent annualized default rate, net of recoveries, of 0.6% for June and July 2021, down from 0.8% in May.