Business Context and Reporting Period
This Form 8-K filing by American Express Company (AXP) was submitted on September 15, 2023, under Item 7.01 Regulation FD Disclosure. The report provides monthly delinquency and write-off statistics for the U.S. Consumer and U.S. Small Business Card Member lending portfolios for the months ended June 30, July 31, and August 31, 2023.
Key Financial Metrics
U.S. Consumer Card Member Loans
- Total Loans (Aug 31, 2023): $77.7 billion
- 30 Days Past Due: 1.2% of total loans (up from 1.1% in July and June)
- Average Loans (Aug 2023): $77.5 billion
- Net Write-off Rate (Principal Only): 1.7% (down from 1.8% in July and June)
U.S. Small Business Card Member Loans
- Total Loans (Aug 31, 2023): $24.5 billion
- 30 Days Past Due: 1.2% of total loans (consistent across June, July, and August)
- Average Loans (Aug 2023): $24.3 billion
- Net Write-off Rate (Principal Only): 1.8% (up from 1.7% in June, consistent with July)
Total Card Member Loans (Consumer + Small Business)
- Total Loans (Aug 31, 2023): $102.2 billion
American Express Credit Account Master Trust (Lending Trust)
- Ending Total Principal Balance (Aug 31, 2023): $26.1 billion
- Annualized Default Rate (Net of Recoveries): 1.1% (down from 1.2% in July)
- Total 30+ Days Delinquent: $0.2 billion (consistent across the three months)
Material Changes Versus Prior Period
- Delinquency Trends: U.S. Consumer 30-day past due rates increased slightly from 1.1% in June/July to 1.2% in August. Small Business delinquency remained stable at 1.2%.
- Write-off Trends: U.S. Consumer net write-off rates improved to 1.7% in August from 1.8% in the prior two months. Small Business write-off rates rose to 1.8% in August from 1.7% in June.
- Loan Growth: Total combined Card Member loans grew from $99.4 billion in June to $102.2 billion in August.
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).
Key Facts for Investor Verification
- Verify the trend in U.S. Consumer 30-day delinquency rates, which ticked up to 1.2% in August.
- Confirm the divergence in write-off rates between Consumer (improving to 1.7%) and Small Business (worsening to 1.8%) segments.
- Review the distinction between the total portfolio statistics and the securitized Lending Trust statistics, as calculation methodologies differ.
- Monitor the stability of the Lending Trust's annualized default rate, which held at 1.1% in August.