8-KRegulation FD

AMERICAN EXPRESS CO 8-K Report, Regulation FD Disclosure (Apr 15, 2024)

Filed April 15, 2024For Securities:AXP

Summary

This 8-K filing from American Express (AXP) provides an update on credit performance metrics for its U.S. Consumer and U.S. Small Business Card Member lending portfolios, as well as its securitized Lending Trust portfolio, for the period ending March 31, 2024. The data is preliminary and furnished to provide additional information beyond the standard 10-D filings. For investors, the key takeaway is the stability in key credit indicators, with delinquency and net write-off rates remaining relatively consistent and at healthy levels across both the total portfolios and the securitized trust, suggesting no immediate signs of significant credit deterioration in the near term. While the figures indicate a stable credit environment for Amex's U.S. loan portfolios, it's important to note the distinction between the total portfolio and the securitized trust. The filing clarifies that these two datasets may not have identical characteristics due to differences in loan mix, vintage, aging, and calculation methodologies. Investors should monitor these trends in conjunction with broader economic conditions and the company's upcoming earnings reports for a comprehensive view of credit risk.

Key Highlights

  • 1Preliminary credit performance data for U.S. Consumer and U.S. Small Business Card Member loans as of and for the three months ended March 31, 2024.
  • 2U.S. Consumer 30-day past due loans as a percentage of total loans remained stable at 1.4% for March 2024.
  • 3U.S. Small Business 30-day past due loans as a percentage of total loans remained stable at 1.5% for March 2024.
  • 4Net write-off rate for U.S. Consumer loans was 2.3% for the three months ended March 31, 2024.
  • 5Net write-off rate for U.S. Small Business loans was 2.3% for the three months ended March 31, 2024.
  • 6Total U.S. Consumer and Small Business Card Member loans stood at $109.9 billion as of March 31, 2024.
  • 7Lending Trust reported a stable annualized default rate, net of recoveries, of 1.4% for the month ended March 31, 2024.

Frequently Asked Questions

The primary purpose of this 8-K filing is to furnish preliminary delinquency and write-off statistics for American Express's U.S. Consumer and U.S. Small Business Card Member lending portfolios, as well as its securitized Lending Trust, for the period ending March 31, 2024. This provides investors with updated credit performance data beyond the regular 10-D filings.

Based on the preliminary data provided, the credit metrics appear stable. The 30-day past due rates for both U.S. Consumer and U.S. Small Business portfolios remained consistent, and the net write-off rates for the three months ended March 31, 2024, are within a range that does not indicate immediate significant deterioration. The Lending Trust also shows a stable default rate.

The filing clarifies that the total U.S. Consumer and U.S. Small Business Card Member loan portfolios include both securitized and non-securitized loans. The American Express Credit Account Master Trust (Lending Trust) only represents the securitized portion. Differences in loan mix, vintage, aging, and calculation methodologies can cause the reported credit performance of the Lending Trust to differ from the total portfolio on a month-to-month basis.

As of March 31, 2024, the total U.S. Consumer Card Member loans were $82.3 billion, and U.S. Small Business Card Member loans were $27.6 billion, bringing the combined total to $109.9 billion. The Ending total principal balance for the securitized Lending Trust was $25.9 billion as of March 1, 2024.