Business Context and Reporting Period
This Form 8-K filing by American Express Company (the "Company") was submitted on October 16, 2017, under Item 7.01 Regulation FD Disclosure. The report provides delinquency and write-off statistics for the Card Member lending portfolios of the U.S. Consumer Services (USCS) and U.S. Small Business segments for the months ended July 31, August 31, and September 30, 2017, as well as the three-month period ended September 30, 2017.
Key Financial Metrics
The filing details credit performance metrics for total loans, delinquency rates, and net write-off rates (principal only) for the specified periods.
| Metric | USCS Card Member Loans | U.S. Small Business Loans | Total U.S. Loans |
|---|---|---|---|
| Total Loans (Sept 30, 2017) | $49.3 Billion | $10.5 Billion | $59.9 Billion |
| 30+ Days Past Due (Sept 30, 2017) | 1.3% | 1.1% | N/A |
| Net Write-off Rate (3 Months Ended Sept 30) | 1.8% | 1.6% | N/A |
American Express Credit Account Master Trust (Lending Trust) Metrics:
- Ending Principal Balance (Sept 30, 2017): $23.5 Billion
- Annualized Default Rate (Sept 2017): 1.4%
- Total 30+ Days Delinquent (Sept 2017): $0.2 Billion
Material Changes Versus Prior Period
USCS Card Member Loans:
- Total loans decreased slightly from $49.5 billion in August to $49.3 billion in September.
- The 30 days past due rate increased from 1.2% in July and August to 1.3% in September.
- The net write-off rate for September (1.6%) improved compared to July and August (1.8%), though the three-month average remained at 1.8%.
U.S. Small Business Loans:
- Total loans grew from $10.2 billion in July to $10.5 billion in September.
- The 30 days past due rate remained stable at 1.1% across all three months.
- The net write-off rate showed improvement, declining from 1.9% in July to 1.6% in August and 1.4% in September.
Lending Trust:
- The ending principal balance decreased from $23.8 billion in July and August to $23.5 billion in September.
- The annualized default rate fluctuated slightly, moving from 1.4% in July to 1.5% in August, then back to 1.4% 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 statistics. However, the Company notes that the credit performance of the Lending Trust may differ from the total USCS or U.S. Small Business portfolios due to differences in loan mix, vintage, aging, and calculation mechanics (e.g., end-of-period balances vs. average balances).
Key Facts for Investor Verification
- Verify the trend in USCS delinquency rates, which rose to 1.3% in September after holding at 1.2% for the prior two months.
- Confirm the improvement in U.S. Small Business net write-off rates, which declined to 1.4% in September from 1.9% in July.
- Review the distinction between the reported portfolio statistics and the Lending Trust statistics, as the latter excludes non-securitized loans and uses different calculation methodologies.
- Note that the September 30, 2017 data is marked as preliminary in the filing.