American Express Company 8-K Summary
Business Context and Reporting Period
This Form 8-K, filed on August 15, 2024, provides Regulation FD disclosure regarding delinquency and write-off statistics for American Express Company's U.S. Consumer and U.S. Small Business Card Member lending portfolios. The data covers the months ended May 31, June 30, and July 31, 2024.
Key Financial Metrics
U.S. Consumer Card Member Loans (July 31, 2024):
- Total loans: $85.9 billion
- Average loans: $85.4 billion
- 30 days past due: 1.3% of total
- Net write-off rate (principal only): 2.1%
U.S. Small Business Card Member Loans (July 31, 2024):
- Total loans: $29.2 billion
- Average loans: $28.9 billion
- 30 days past due: 1.4% of total
- Net write-off rate (principal only): 2.3%
Total Combined Card Member Loans: $115.1 billion as of July 31, 2024.
American Express Credit Account Master Trust (Lending Trust) Performance (July 2024):
- Ending total principal balance: $25.8 billion
- Defaulted amount: $0.04 billion
- Annualized default rate (net of recoveries): 1.2%
- Total 30+ days delinquent: $0.2 billion
Material Changes Versus Prior Periods
U.S. Consumer Portfolio:
- Total loans increased from $84.0 billion (May) to $85.9 billion (July).
- Net write-off rate improved sequentially from 2.4% (May) to 2.1% (July).
- Delinquency rate (30+ days) remained stable at 1.3% across all three months.
U.S. Small Business Portfolio:
- Total loans increased from $28.2 billion (May) to $29.2 billion (July).
- Net write-off rate improved sequentially from 2.5% (May) to 2.3% (July).
- Delinquency rate (30+ days) remained stable at 1.4% across all three months.
Lending Trust:
- Annualized default rate improved from 1.5% (June) to 1.2% (July).
- Ending principal balance remained flat at $25.8 billion for May, June, and July.
Management Commentary and Risks
The filing notes that the reported statistics for the total U.S. Consumer and Small Business portfolios include both securitized and non-securitized loans, whereas the Lending Trust data reflects only securitized loans. Consequently, credit performance metrics may differ between the two due to variations in loan mix, vintage, aging, and calculation methodologies (e.g., end-of-period balances vs. average balances). The filing does not provide specific forward-looking guidance or management commentary beyond the statistical disclosure.
Key Facts for Investor Verification
- Verify the sequential improvement in net write-off rates for both Consumer (2.1%) and Small Business (2.3%) portfolios in July 2024.
- Confirm the stability of delinquency rates (1.3% Consumer, 1.4% Small Business) over the three-month period.
- Review the distinction between total portfolio statistics and Lending Trust statistics to understand the impact of securitization on reported credit metrics.
- Monitor the Lending Trust's annualized default rate, which decreased to 1.2% in July 2024.