UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
FORM 8-K
CURRENT REPORT
Pursuant to Section 13 or 15(d) of the
Securities Exchange Act of 1934
Date of Report (Date of earliest event reported): October 15, 2009
AMERICAN EXPRESS COMPANY
(Exact name of registrant as specified in its charter)
New York 1-7657 13-4922250
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(State or other jurisdiction (Commission File Number) (IRS Employer
of incorporation Identification No.)
or organization)
200 Vesey Street, World Financial Center
New York, New York 10285
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(Address of principal executive offices) (Zip Code)
Registrant's telephone number, including area code: (212) 640-2000
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(Former name or former address, if changed since last report)
Check the appropriate box below if the Form 8-K filing is intended to
simultaneously satisfy the filing obligation of the registrant
under any of the following provisions (see General Instruction A.2. below):
[ ] Written communications pursuant to Rule 425 under the Securities Act
(17 CFR 230.425)
[ ] Soliciting material pursuant to Rule 14a-12 under the Exchange Act
(17 CFR 240.14a-12)
[ ] Pre-commencement communications pursuant to Rule 14d-2(b) under the
Exchange Act (17 CFR 240.14d-2(b))
[ ] Pre-commencement communications pursuant to Rule 13e-4(c) under the
Exchange Act (17 CFR 240.13e-4(c))
Item 7.01 Regulation FD Disclosure
American Express Company (the "Company") is hereby furnishing below owned
and managed basis delinquency and write-off statistics for the lending
portfolio of its U.S. Card Services ("USCS") operating segment for the months
ended July 31, August 31 and September 30, 2009, and the three months ended
September 30, 2009. As previously stated in its reports filed with the
Securities and Exchange Commission (the "Commission"), the Company believes
that its managed basis presentation provides the Company's investors with a
more comprehensive portrayal of the key dynamics of the Company's U.S.
cardmember lending business over time.
American Express Company
U.S. Card Services
Delinquency and Write-off Statistics
As of and for the months ended July 31, August 31 and September 30, 2009 and
the three months ended September 30, 2009
(Billions, except percentages)
(Preliminary)
Three months
ended
July 31, August 31, Sept. 30, Sept. 30,
2009 2009 2009 2009
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Cardmember lending - owned basis (A):
Total Loans $23.1 $24.3 $22.7 $22.7
30 days past due loans as a % of total 4.3% 4.1% 4.0% 4.0%
Average loans $23.3 $23.7 $23.5 $23.4
Net write-off rate 9.9% 10.2% 9.2% 9.8%
Cardmember lending - managed basis (B):
Total Loans $52.9 $53.0 $51.9 $51.9
30 days past due loans as a % of total 4.2% 4.1% 4.1% 4.1%
Average loans $53.4 $52.9 $52.9 $52.9
Net write-off rate 9.2% 9.0% 8.4% 8.9%
(A) "Owned," a GAAP basis measurement, reflects only cardmember loans
included in the Company's consolidated balance sheets. For the month ended
August 31, 2009, the increase in the owned basis net write-off rate was driven
by the mechanics of the calculation relating to the transfer to the American
Express Credit Account Master Trust (the "Lending Trust") on August 20, 2009,
of approximately $3 billion of loans generated from cardmember accounts newly
designated for addition to the Lending Trust, as well as maturities taking
place during the month of certificates previously issued by the Lending Trust.
(B) The managed basis presentation assumes that there have been no
off-balance sheet securitization transactions, i.e., all securitized
cardmember loans and related income effects are reflected as if they were in
the Company's balance sheets and income statements, respectively. The
difference between the "owned basis" (GAAP) information and "managed basis"
information is attributable to the effects of securitization activities. The
Company presents U.S. Card Services information on a managed basis because
that is the way the Company's management views and manages the business.
Management believes that a full picture of trends in the Company's cardmember
lending business can only be derived by evaluating the performance of both
securitized and non-securitized cardmember loans and that use of a managed
basis presentation presents a more comprehensive portrayal of the key dynamics
of the cardmember lending business over time.
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The statistics presented above provide information that is additional to
the data reported by the American Express Credit Account Master Trust (the
"Lending Trust") in its monthly Form 10-D report filed with the Commission.
The loans that have been securitized through the off-balance sheet Lending
Trust do not possess identical characteristics with those of the total (i.e.,
managed) portfolio of USCS loans, which reflects the aggregate of securitized
and owned loans. Thus, the reported credit performance of the Lending Trust
may, on a month-to-month basis, be better or worse than the credit performance
of the managed portfolio. Reported differences may arise as a result of, among
other things, differences in the mix and vintage of loans between the Lending
Trust and the managed portfolio (including, among other things, the larger
proportion of small business loans in the owned portfolio), the number of days
in the reporting period covered by the Form 10-D being filed by the Lending
Trust, the use of end-of-period principal loan balances to calculate write-off
statistics in the Lending Trust compared to the use of average loan balances
over the reporting period used in the managed statistics, as well as other
mechanics of the calculation for the owned net write-off rate, which is
impacted by the additions, issuances and maturities relating to the
securitization trust within a particular period. In addition, the reporting
period for the managed portfolio is based on a calendar month, as compared to
the reporting period covered by the Form 10-D reports for the Lending Trust,
which is generally based on a monthly period beginning on or around the 25th
day of each calendar month.
Set forth below is certain information regarding the credit performance
of the Lending Trust for its three most recent monthly reporting periods, as
reported in its Form 10-D report filed with respect to each such period.
American Express Credit Account Master Trust
(Billions, except percentages)
June 26, 2009 July 27, 2009 Aug. 26, 2009
through through through
July 26, 2009 Aug. 25, 2009 Sept. 24, 2009
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Ending total principal balance $33.2 $35.9 $35.0
Defaulted amount,
net of recoveries $ 0.3 $ 0.3 $ 0.2
Annualized default rate,
net of recoveries 8.9% 8.5% 8.1%
Total 30+ days delinquent $ 1.5 $ 1.5 $ 1.5
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Forward-Looking Statements
This report includes forward-looking statements, which are subject to
risks and uncertainties. Forward-looking statements contain words such as
"believe," "expect," "anticipate," "optimistic," "intend," "plan," "aim,"
"will," "may," "should," "could," "would," "likely" and similar expressions.
Readers are cautioned not to place undue reliance on these forward-looking
statements, which speak only as of the date on which they are made. The
Company undertakes no obligation to update or revise any forward-looking
statements. Factors that could cause actual results to differ materially from
these forward-looking statements include, but are not limited to, the
following: the Company's ability to manage credit risk related to consumer and
small business loans and other credit trends, which will depend in part on the
economic environment, including, among other things, the housing market, the
rates of bankruptcies and unemployment, which can affect spending on card
products and debt payments by individuals and small business customers, and on
the effectiveness of the Company's credit models; the impact of the Company's
efforts to deal with delinquent cardmembers in the current challenging
economic environment, which may affect payment patterns of cardmembers, the
actual level of cardmember delinquencies in the future and the perception of
the Company's services, products and brands; the Company's near-term write-off
rates, including those for the fourth quarter of 2009, which will depend in
part on changes in the level of the Company's loan balances, delinquency rates
of cardmembers and bankruptcy filings and unemployment rates; and the actual
amount to be spent by the Company on marketing, promotion, rewards and
cardmember services based on management's assessment of competitive
opportunities and other factors affecting its judgment, and during the
remainder of 2009, the extent of provision benefit, if any, from lower than
expected write offs. A further description of these and other risks and
uncertainties can be found in the Company's Annual Report on Form 10-K for the
year ended December 31, 2008, its Quarterly Reports on Form 10-Q for the
quarters ended March 31 and June 30, 2009, and its other reports filed with
the SEC.
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SIGNATURE
Pursuant to the requirements of the Securities Exchange Act of 1934, the
registrant has duly caused this report to be signed on its behalf by the
undersigned hereunto duly authorized.
AMERICAN EXPRESS COMPANY
(REGISTRANT)
By: /s/ Carol V. Schwartz
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Name: Carol V. Schwartz
Title: Secretary
Date: October 15, 2009
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