Business Context and Reporting Period
This Form 8-K filing by American Express Company, dated October 15, 2018, serves as a Regulation FD disclosure. It provides preliminary delinquency and write-off statistics for the U.S. Consumer Card Member and U.S. Small Business Card Member lending portfolios for the months ended July 31, August 31, and September 30, 2018, as well as the three-month period ended September 30, 2018.
Key Financial Metrics
U.S. Consumer Card Member Loans (as of Sept 30, 2018):
- Total Loans: $56.2 billion
- 30 Days Past Due: 1.4% of total
- Average Loans: $55.9 billion
- Net Write-off Rate (Principal Only): 2.0% (monthly), 2.1% (quarterly)
U.S. Small Business Card Member Loans (as of Sept 30, 2018):
- Total Loans: $11.9 billion
- 30 Days Past Due: 1.1% of total
- Average Loans: $11.9 billion
- Net Write-off Rate (Principal Only): 1.5% (monthly), 1.7% (quarterly)
Combined Total Card Member Loans:
- Total Loans: $68.1 billion
American Express Credit Account Master Trust (Lending Trust):
- Ending Principal Balance (Sept 2018): $22.9 billion
- Annualized Default Rate (Net of Recoveries): 1.3%
- Total 30+ Days Delinquent: $0.2 billion
Material Changes Versus Prior Period
U.S. Consumer Portfolio:
- Total loans increased from $55.6 billion in August to $56.2 billion in September.
- The 30-day delinquency rate rose slightly from 1.3% in August to 1.4% in September.
- The monthly net write-off rate improved from 2.2% in August to 2.0% in September.
U.S. Small Business Portfolio:
- Total loans increased from $11.8 billion in August to $11.9 billion in September.
- The 30-day delinquency rate remained stable at 1.1%.
- The monthly net write-off rate improved from 1.7% in August to 1.5% in September.
Lending Trust:
- The ending principal balance decreased slightly from $23.0 billion in August to $22.9 billion in September.
- The annualized default rate improved from 1.5% 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 standard disclosure context. It notes that the credit performance of the Lending Trust may differ from the total portfolio statistics 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 in net write-off rates for both Consumer and Small Business segments over the next quarter to confirm the improvement seen in September.
- Monitor the 30-day delinquency rate for the U.S. Consumer segment, which ticked up to 1.4% in September.
- Compare these preliminary statistics with the final data reported in the subsequent quarterly Form 10-Q.
- Review the Lending Trust's Form 10-D filings to understand the specific composition of securitized loans versus the total portfolio.