Summary
This 8-K filing from American Express (AXP) 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 August 31, September 30, and October 31, 2022. Investors can use this information to monitor the company's credit quality trends. The data indicates relatively stable credit performance across these segments, with 30-day delinquencies and net write-off rates remaining at low levels.
Key Highlights
- 1U.S. Consumer and U.S. Small Business total loans increased from $86.1 billion in August to $89.5 billion in October 2022.
- 230-day past due rates for U.S. Consumer loans remained stable, hovering around 0.8% to 0.9% of total loans.
- 330-day past due rates for U.S. Small Business loans also showed stability, at 0.7% to 0.8% of total loans.
- 4Net write-off rates (principal only) for U.S. Consumer loans were 0.8% in August and September, increasing slightly to 0.9% in October.
- 5Net write-off rates (principal only) for U.S. Small Business loans were 0.7% in August and September, increasing slightly to 0.8% in October.
- 6The filing also provides data for the American Express Credit Account Master Trust, showing a slight increase in the annualized default rate, net of recoveries, from 0.5% in August to 0.7% in October.
Frequently Asked Questions
The 30-day past due rates for both U.S. Consumer and U.S. Small Business Card Member loans have remained at low levels, generally between 0.7% and 0.9% of total loans across the reported months (August, September, and October 2022). This indicates stable credit performance without a significant increase in early-stage delinquencies during this period.
Net write-off rates, calculated on a principal-only basis, saw a slight increase in October 2022 compared to August and September. For U.S. Consumer loans, the rate moved from 0.8% to 0.9%, and for U.S. Small Business loans, it rose from 0.7% to 0.8%. While a slight uptick, these rates are still considered modest and reflect ongoing credit risk management.
The filing distinguishes between the 'Total' U.S. Consumer and U.S. Small Business Card Member loan portfolios (which include both securitized and non-securitized loans) and the American Express Credit Account Master Trust (which only contains securitized loans). The company notes that these two sets of data may not have identical characteristics due to differences in loan mix, vintage, aging, and calculation methodologies for write-off statistics, meaning the reported credit performance of the Lending Trust might differ from the overall portfolio performance.