Business Context and Reporting Period
This Form 8-K filing by American Express Company (the "Company") was submitted on October 15, 2015, pursuant to Regulation FD. The report provides supplemental credit performance statistics for the U.S. Card Services ("USCS") operating segment. The data covers the months ended July 31, August 31, and September 30, 2015, as well as the three-month period ended September 30, 2015.
Key Financial Metrics
The filing focuses exclusively on credit quality metrics for the USCS lending portfolio and the American Express Credit Account Master Trust ("Lending Trust"). It does not report revenue, profit, cash flow, margins, debt, or liquidity figures.
USCS Card Member Lending Portfolio
| Metric | July 31, 2015 | August 31, 2015 | Sept 30, 2015 (Prelim) | 3 Months Ended Sept 30, 2015 |
|---|---|---|---|---|
| Total Loans ($ Billions) | 61.8 | 62.6 | 62.1 | 62.1 |
| 30+ Days Past Due (% of Total) | 0.9% | 0.9% | 1.0% | 1.0% |
| Average Loans ($ Billions) | 61.7 | 62.2 | 62.4 | 62.1 |
| Net Write-off Rate (Principal Only) | 1.3% | 1.3% | 1.2% | 1.3% |
Lending Trust (Securitized Portfolio)
| Metric | July 2015 | August 2015 | September 2015 |
|---|---|---|---|
| Ending Total Principal Balance ($ Billions) | 27.1 | 27.2 | 26.6 |
| Defaulted Amount ($ Billions) | 0.05 | 0.04 | 0.04 |
| Annualized Default Rate (Net of Recoveries) | 1.1% | 1.1% | 1.0% |
| Total 30+ Days Delinquent ($ Billions) | 0.2 | 0.2 | 0.2 |
Material Changes
For the USCS portfolio, the 30+ days past due ratio increased slightly from 0.9% in July and August to 1.0% in September. The net write-off rate for September (1.2%) was marginally lower than the 1.3% rate observed in the prior two months. The Lending Trust showed a decrease in the annualized default rate to 1.0% in September from 1.1% in the preceding months, alongside a reduction in the ending principal balance to $26.6 billion.
Guidance, Outlook, and Risks
The filing contains no forward-looking guidance, management commentary on future outlook, or specific risk factors beyond the disclosure of credit statistics. The document notes that credit performance metrics for the Lending Trust may differ from the total USCS portfolio due to differences in loan mix (including a larger proportion of small business loans in the non-securitized portion), vintage, and calculation methodologies (end-of-period balances vs. average balances).
Investor Verification Checklist
- Verify the preliminary nature of the September 30, 2015, USCS statistics.
- Confirm the distinction between the total USCS portfolio (securitized and non-securitized) and the Lending Trust portfolio when analyzing credit trends.
- Review the Company's subsequent quarterly earnings release for full financial results (revenue, profit, cash flow) not included in this 8-K.
- Monitor the trend of the 30+ days past due ratio, which ticked up to 1.0% in September.