Business Context and Reporting Period
This Form 8-K filing by American Express Company (AXP) was submitted on October 15, 2024, 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, 2024, as well as the three-month period ended September 30, 2024.
Key Financial Metrics
U.S. Consumer Card Member Loans
- Total Loans (Sept 30, 2024): $86.8 billion
- Average Loans (Q3 2024): $86.2 billion
- 30+ Days Past Due (Sept 30, 2024): 1.4% of total loans
- Net Write-off Rate (Q3 2024): 2.1% (principal only)
U.S. Small Business Card Member Loans
- Total Loans (Sept 30, 2024): $29.9 billion
- Average Loans (Q3 2024): $29.4 billion
- 30+ Days Past Due (Sept 30, 2024): 1.5% of total loans
- Net Write-off Rate (Q3 2024): 2.2% (principal only)
Combined Card Member Loans
- Total Loans (Sept 30, 2024): $116.7 billion
American Express Credit Account Master Trust (Lending Trust)
- Ending Principal Balance (Sept 30, 2024): $25.5 billion
- Annualized Default Rate (Sept 2024): 1.3% (net of recoveries)
- Total 30+ Days Delinquent (Sept 2024): $0.2 billion
Material Changes Versus Prior Period
- Delinquency Trends: The 30+ days past due ratio for U.S. Consumer loans increased slightly from 1.3% in August to 1.4% in September. Similarly, U.S. Small Business delinquency rose from 1.4% to 1.5% over the same period.
- Write-off Trends: Net write-off rates for both Consumer (2.1%) and Small Business (2.2%) portfolios in September were lower than the rates observed in August (2.2% and 2.3%, respectively).
- Lending Trust Performance: The annualized default rate for the Lending Trust decreased from 1.4% in August to 1.3% 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 credit performance of the Lending Trust 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 net write-off rates in the upcoming quarterly earnings report to confirm if the September improvement is sustained.
- Compare the Lending Trust default rates with the broader portfolio metrics to assess the impact of securitization on reported credit quality.
- Monitor the 30+ days past due ratios for potential acceleration in delinquencies given the slight month-over-month increases in September.
- Review the full Q3 2024 earnings release for context on how these credit metrics impact overall net interest income and provision for credit losses.