Business Context and Reporting Period
This Form 8-K filing by American Express Company (AXP) was submitted on October 17, 2022, under Item 7.01 (Regulation FD Disclosure). The report provides preliminary delinquency and write-off statistics for the U.S. Consumer and U.S. Small Business Card Member lending portfolios for the months ended July 31, August 31, and September 30, 2022, as well as the three-month period ended September 30, 2022.
Key Financial Metrics
The filing focuses on credit performance metrics rather than revenue or profit. Key data points for the three months ended September 30, 2022, include:
- Total Card Member Loans: $87.0 billion (U.S. Consumer and U.S. Small Business combined).
- U.S. Consumer Portfolio: Total loans of $66.3 billion with a net write-off rate of 0.8% and 30+ days past due loans at 0.9%.
- U.S. Small Business Portfolio: Total loans of $20.7 billion with a net write-off rate of 0.7% and 30+ days past due loans at 0.7%.
- Lending Trust Performance: For the month ended September 30, 2022, the American Express Credit Account Master Trust reported an ending principal balance of $25.6 billion and an annualized default rate (net of recoveries) of 0.6%.
Material Changes Versus Prior Period
Credit metrics showed slight deterioration or stability compared to the prior two months:
- Delinquency Trends: The 30+ days past due ratio for U.S. Consumer loans increased from 0.7% in July to 0.9% in September. U.S. Small Business delinquency rose from 0.6% in July to 0.7% in September.
- Write-off Trends: Net write-off rates for both U.S. Consumer and U.S. Small Business portfolios remained stable at 0.8% and 0.7% respectively for the three-month period, matching the September monthly rate.
- Lending Trust Defaults: The annualized default rate for the Lending Trust fluctuated between 0.5% and 0.6% over the three-month period, ending at 0.6% in September.
Guidance, Outlook, and Risks
The filing does not contain forward-looking guidance, management commentary on future outlook, or specific risk factors beyond the disclosure of credit performance statistics. The document notes that the Lending Trust's reported credit performance may differ from the total portfolio due to differences in loan mix, vintage, aging, and calculation mechanics (e.g., end-of-period balances vs. average balances).
Investor Verification Checklist
- Verify the trend of increasing delinquency rates (30+ days past due) in both Consumer and Small Business segments from July to September 2022.
- Compare the Lending Trust's annualized default rate (0.6%) against the broader portfolio net write-off rates to assess securitization impact.
- Confirm the stability of net write-off rates despite rising delinquency percentages.
- Review subsequent Form 10-D filings for the Lending Trust to track the $25.6 billion principal balance trend.