Summary
This 8-K filing from American Express (AXP) on September 15, 2021, 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 June 30, July 31, and August 31, 2021. The data is furnished to supplement information already reported in the company's Form 10-D filings related to its securitized loan portfolio. Investors can use this information to monitor the company's credit risk and the health of its loan book in key segments.
Key Highlights
- 1Delinquency rates for U.S. Consumer loans remained stable at 0.6% for 30 days past due across the reported months.
- 2Net write-off rate for U.S. Consumer loans saw a slight decrease from 0.7% in June and July to 0.6% in August.
- 330-day past due rates for U.S. Small Business loans increased slightly from 0.4% in June and July to 0.5% in August.
- 4Net write-off rate for U.S. Small Business loans remained stable at 0.5% for June and August, with a slight dip to 0.5% in July (presented as 0.5% for all months in the table, but likely referring to a precise calculation).
- 5Total U.S. Consumer and Small Business Card Member loans grew slightly from $66.2 billion in June to $67.1 billion by August 2021.
- 6Information is also provided for the American Express Credit Account Master Trust, showing a decrease in the annualized default rate from 0.6% in June and July to 0.4% in August.
- 7The filing clarifies that the securitized portfolio (Lending Trust) may have different credit performance characteristics compared to the total U.S. Consumer and U.S. Small Business loan portfolios.
Frequently Asked Questions
The main purpose of this 8-K filing is to furnish investors with updated delinquency and write-off statistics for American Express's U.S. Consumer and U.S. Small Business Card Member lending portfolios for June, July, and August 2021. This provides more granular and timely information on credit quality for these key segments.
The filing provides statistics for both the total U.S. Consumer and U.S. Small Business Card Member loan portfolios (which include both securitized and non-securitized loans) and separately for the American Express Credit Account Master Trust (which represents the securitized portion). It also notes that these two may have different characteristics.
The 'Net write-off rate – principal only' indicates the percentage of loan principal that was written off as uncollectible, after accounting for any recoveries, during the specified period. Excluding interest and/or fees provides a clearer view of the principal loss itself.
Based on the provided data for the three months, credit quality appears relatively stable with only minor fluctuations. Delinquencies for U.S. Consumer loans remained steady, and write-off rates showed a slight improvement or remained consistent. For U.S. Small Business, there was a slight uptick in 30-day delinquencies but stable write-off rates. The securitized trust also showed a decrease in its default rate in August.