EX-99.2 3 exhibit99_2.htm EXHIBIT 99.2 OF AMERICAN EXPRESS COMPANY
EXHIBIT 99.2
 
American Express Company
 (Preliminary)
Consolidated Statements of Income
 
(Millions, except percentages and per share amounts)
 

 
  
Q4'18
    
Q3'18
    
Q2'18
    
Q1'18
    
Q4'17
    
YOY % change
    
YTD'18
    
YTD'17
    
YOY % change
  
Non-interest revenues
                                                      
Discount revenue
  
$
6,457
    
$
6,181
    
$
6,194
    
$
5,889
    
$
6,060
      
7
    
$
24,721
    
$
22,890
      
8
  
Net card fees
    
897
      
870
      
844
      
830
      
785
      
14
      
3,441
      
3,090
      
11
  
Other fees and commissions
    
788
      
798
      
786
      
781
      
778
      
1
      
3,153
      
2,990
      
5
  
Other
    
300
      
334
      
349
      
377
      
345
      
(13
)
    
1,360
      
1,457
      
(7
)
Total non-interest revenues
    
8,442
      
8,183
      
8,173
      
7,877
      
7,968
      
6
      
32,675
      
30,427
      
7
  
Interest income
                                                                        
Interest on loans
    
2,674
      
2,554
      
2,387
      
2,326
      
2,205
      
21
      
9,941
      
8,148
      
22
  
Interest and dividends on investment securities
    
35
      
35
      
27
      
21
      
21
      
67
      
118
      
89
      
33
  
Deposits with banks and other
    
157
      
149
      
126
      
115
      
93
      
69
      
547
      
326
      
68
  
Total interest income
    
2,866
      
2,738
      
2,540
      
2,462
      
2,319
      
24
      
10,606
      
8,563
      
24
  
Interest expense
                                                                        
Deposits
    
377
      
340
      
300
      
270
      
241
      
56
      
1,287
      
779
      
65
  
Long-term debt and other
    
457
      
437
      
411
      
351
      
339
      
35
      
1,656
      
1,333
      
24
  
Total interest expense
    
834
      
777
      
711
      
621
      
580
      
44
      
2,943
      
2,112
      
39
  
Net interest income
    
2,032
      
1,961
      
1,829
      
1,841
      
1,739
      
17
      
7,663
      
6,451
      
19
  
Total revenues net of interest expense
    
10,474
      
10,144
      
10,002
      
9,718
      
9,707
      
8
      
40,338
      
36,878
      
9
  
Provisions for losses
                                                                        
Charge card
    
236
      
214
      
245
      
242
      
205
      
15
      
937
      
795
      
18
  
Card Member loans
    
679
      
560
      
528
      
499
      
596
      
14
      
2,266
      
1,868
      
21
  
Other
    
39
      
43
      
33
      
34
      
33
      
18
      
149
      
97
      
54
  
Total provisions for losses
    
954
      
817
      
806
      
775
      
834
      
14
      
3,352
      
2,760
      
21
  
Total revenues net of interest expense after provisions for losses
    
9,520
      
9,327
      
9,196
      
8,943
      
8,873
      
7
      
36,986
      
34,118
      
8
  
   
Expenses
                                                                        
Marketing and business development (A)
    
1,820
      
1,642
      
1,663
      
1,345
      
1,535
      
19
      
6,470
      
5,722
      
13
  
Card Member rewards
    
2,516
      
2,400
      
2,433
      
2,347
      
2,262
      
11
      
9,696
      
8,687
      
12
  
Card Member services
    
495
      
457
      
416
      
409
      
383
      
29
      
1,777
      
1,392
      
28
  
Salaries and employee benefits
    
1,294
      
1,350
      
1,280
      
1,326
      
1,436
      
(10
)
    
5,250
      
5,258
      
-
  
Professional services
    
671
      
489
      
508
      
457
      
534
      
26
      
2,125
      
2,040
      
4
  
Occupancy and equipment
    
540
      
489
      
484
      
520
      
493
      
10
      
2,033
      
2,018
      
1
  
Other, net (A)
    
353
      
382
      
321
      
457
      
432
      
(18
)
    
1,513
      
1,576
      
(4
)
Total expenses
    
7,689
      
7,209
      
7,105
      
6,861
      
7,075
      
9
      
28,864
      
26,693
      
8
  
Pretax income
    
1,831
      
2,118
      
2,091
      
2,082
      
1,798
      
2
      
8,122
      
7,425
      
9
  
Income tax provision (benefit)
    
(179
)
    
464
      
468
      
448
      
3,004
      
#
      
1,201
      
4,677
      
(74
)
Net income (loss)
  
$
2,010
    
$
1,654
    
$
1,623
    
$
1,634
    
$
(1,206
)
    
#
    
$
6,921
    
$
2,748
      
#
  
Net income (loss) attributable to common shareholders (B)
  
$
1,975
    
$
1,621
    
$
1,591
    
$
1,600
    
$
(1,228
)
    
#
    
$
6,787
    
$
2,646
      
#
  
Effective tax rate
    
(9.8
%)
    
21.9
%
    
22.4
%
    
21.5
%
    
167.1
%
            
14.8
%
    
63.0
%
        
 
                                                                        
Earnings Per Common Share
                                                                        
Basic
                                                                        
Net income (loss) attributable to common shareholders
  
$
2.33
    
$
1.89
    
$
1.85
    
$
1.86
    
$
(1.42
)
    
#
    
$
7.93
    
$
3.00
      
#
  
Average common shares outstanding
    
850
      
858
      
860
      
859
      
865
      
(2
)
    
856
      
883
      
(3
)
Diluted
                                                                        
Net income (loss) attributable to common shareholders
  
$
2.32
    
$
1.88
    
$
1.84
    
$
1.86
    
$
(1.42
)
    
#
    
$
7.91
    
$
2.99
      
#
  
Average common shares outstanding
    
852
      
860
      
862
      
861
      
865
      
(2
)
    
859
      
886
      
(3
)
Cash dividends declared per common share
  
$
0.39
    
$
0.39
    
$
0.35
    
$
0.35
    
$
0.35
      
11
    
$
1.48
    
$
1.34
      
10
  

# - Denotes a variance of 100 percent or more.
 
 
 
 
 
 
 



 
See Appendix IV for footnote references

 
-1-



American Express Company
(Preliminary)
Consolidated Balance Sheets and Related Statistical Information
 
(Billions, except percentages, per share amounts and where indicated)
 

 
  
Q4'18
    
Q3'18
    
Q2'18
    
Q1'18
    
Q4'17
    
YOY % change
  
Assets
                                    
Cash & cash equivalents
  
$
27
    
$
30
    
$
30
    
$
31
    
$
33
      
(18
)
Card Member receivables, less reserves
    
55
      
55
      
54
      
54
      
54
      
2
  
Card Member Loans, less reserves
    
80
      
76
      
74
      
71
      
72
      
11
  
Investment securities
    
5
      
6
      
5
      
3
      
3
      
67
  
Other (C)
    
22
      
22
      
22
      
21
      
19
      
16
  
Total assets
  
$
189
    
$
189
    
$
185
    
$
180
    
$
181
      
4
  
   
Liabilities and Shareholders' Equity
                                                
Customer deposits
  
$
70
    
$
69
    
$
67
    
$
67
    
$
64
      
9
  
Short-term borrowings
    
3
      
2
      
2
      
2
      
3
      
-
  
Long-term debt
    
58
      
55
      
56
      
52
      
56
      
4
  
Other (C)
    
36
      
42
      
39
      
39
      
40
      
(10
)
Total liabilities
    
167
      
168
      
164
      
160
      
163
      
2
  
   
Shareholders' Equity
    
22
      
21
      
21
      
20
      
18
      
22
  
Total liabilities and shareholders' equity
  
$
189
    
$
189
    
$
185
    
$
180
    
$
181
      
4
  
   
Return on average equity (D)
    
33.5
%
    
18.1
%
    
16.7
%
    
15.2
%
    
13.2
%
        
Return on average common equity (D)
    
35.6
%
    
19.0
%
    
17.5
%
    
15.9
%
    
13.7
%
        
Book value per common share (dollars)
  
$
24.45
    
$
23.27
    
$
22.42
    
$
20.96
    
$
19.42
      
26
  




 
See Appendix IV for footnote references

 
-2-



American Express Company
(Preliminary)
Consolidated Capital

 
  
Q4'18
    
Q3'18
    
Q2'18
    
Q1'18
    
Q4'17
  
Shares Outstanding (in millions)
    
Beginning of period
    
854
      
861
      
860
      
859
      
871
  
Repurchase of common shares
    
(8
)
    
(7
)
    
-
      
-
      
(14
)
Net impact of employee benefit plans and others
    
1
      
-
      
1
      
1
      
2
  
End of period
    
847
      
854
      
861
      
860
      
859
  
   
Risk-Based Capital Ratios - Basel III ($ in billions) (E)
    
Common Equity Tier 1/Risk Weighted Assets (RWA)
    
11.0
%
    
10.8
%
    
10.1
%
    
9.4
%
    
9.0
%
Tier 1
    
12.0
%
    
11.8
%
    
11.1
%
    
10.5
%
    
10.1
%
Total
    
13.6
%
    
13.4
%
    
12.8
%
    
12.2
%
    
11.8
%
   
Common Equity Tier 1
  
$
17.5
    
$
16.6
    
$
15.2
    
$
13.9
    
$
13.2
  
Tier 1 Capital
  
$
19.1
    
$
18.2
    
$
16.8
    
$
15.5
    
$
14.7
  
Tier 2 Capital
  
$
2.6
    
$
2.5
    
$
2.5
    
$
2.4
    
$
2.4
  
Total Capital
  
$
21.7
    
$
20.7
    
$
19.3
    
$
17.9
    
$
17.1
  
RWA
  
$
158.8
    
$
154.7
    
$
150.9
    
$
147.4
    
$
145.9
  
Tier 1 Leverage
    
10.4
%
    
10.1
%
    
9.7
%
    
8.8
%
    
8.6
%
Supplementary Leverage Ratio (SLR) (F)
    
8.9
%
    
8.6
%
    
8.3
%
    
7.6
%
    
7.4
%
Average Total Assets to calculate the Tier 1 Leverage Ratio (G)
  
$
183.2
    
$
179.8
    
$
172.5
    
$
175.0
    
$
171.2
  
Total Leverage Exposure to calculate SLR
  
$
214.4
    
$
210.7
    
$
202.4
    
$
204.4
    
$
198.8
  


 
See Appendix IV for footnote references

 
-3-



American Express Company
 
(Preliminary)
Selected Card Related Statistical Information
 
 
(Billions, except percentages and where indicated)
 
 

 
  
Q4'18
    
Q3'18
    
Q2'18
    
Q1'18
    
Q4'17
    
YOY % change
    
YTD'18
    
YTD'17
    
YOY % change
  
Billed business (H)
                                                      
U.S.
  
$
205.1
    
$
194.6
    
$
195.4
    
$
182.5
    
$
188.9
      
9
    
$
777.6
    
$
708.3
      
10
  
Outside the U.S.
    
103.9
      
100.1
      
101.1
      
101.3
      
102.5
      
1
      
406.4
      
376.9
      
8
  
Total
  
$
309.0
    
$
294.7
    
$
296.5
    
$
283.8
    
$
291.4
      
6
    
$
1,184.0
    
$
1,085.2
      
9
  
Proprietary
  
$
264.4
    
$
250.2
    
$
251.1
    
$
236.9
    
$
242.6
      
9
    
$
1,002.6
    
$
900.6
      
11
  
Global Network Services (GNS)
    
44.6
      
44.5
      
45.4
      
46.9
      
48.8
      
(9
)
    
181.4
      
184.6
      
(2
)
Total
  
$
309.0
    
$
294.7
    
$
296.5
    
$
283.8
    
$
291.4
      
6
    
$
1,184.0
    
$
1,085.2
      
9
  
Cards-in-force (millions) (I)
                                                                        
U.S.
    
53.7
      
53.0
      
51.9
      
51.3
      
50.0
      
7
      
53.7
      
50.0
      
7
  
Outside the U.S.
    
60.3
      
62.1
      
62.4
      
62.9
      
62.8
      
(4
)
    
60.3
      
62.8
      
(4
)
Total
    
114.0
      
115.1
      
114.3
      
114.2
      
112.8
      
1
      
114.0
      
112.8
      
1
  
Proprietary
    
69.1
      
68.5
      
67.4
      
66.4
      
64.6
      
7
      
69.1
      
64.6
      
7
  
GNS
    
44.9
      
46.6
      
46.9
      
47.8
      
48.2
      
(7
)
    
44.9
      
48.2
      
(7
)
Total
    
114.0
      
115.1
      
114.3
      
114.2
      
112.8
      
1
      
114.0
      
112.8
      
1
  
Basic cards-in-force (millions) (I)
                                                                        
U.S.
    
42.3
      
41.7
      
40.9
      
40.4
      
39.4
      
7
      
42.3
      
39.4
      
7
  
Outside the U.S.
    
50.3
      
51.8
      
52.0
      
52.4
      
52.2
      
(4
)
    
50.3
      
52.2
      
(4
)
Total
    
92.6
      
93.5
      
92.9
      
92.8
      
91.6
      
1
      
92.6
      
91.6
      
1
  
Average proprietary basic Card Member spending (dollars)
                                                                        
U.S.
  
$
5,369
    
$
5,169
    
$
5,275
    
$
5,015
    
$
5,300
      
1
    
$
20,840
    
$
20,317
      
3
  
Outside the U.S.
  
$
4,103
    
$
3,864
    
$
3,909
    
$
3,869
    
$
3,918
      
5
    
$
15,756
    
$
14,277
      
10
  
Average
  
$
4,997
    
$
4,784
    
$
4,871
    
$
4,677
    
$
4,890
      
2
    
$
19,340
    
$
18,519
      
4
  
Card Member loans
                                                                        
U.S.
  
$
72.0
    
$
68.1
    
$
66.3
    
$
63.9
    
$
64.5
      
12
    
$
72.0
    
$
64.5
      
12
  
Outside the U.S.
    
9.9
      
9.5
      
9.1
      
8.9
      
8.9
      
11
      
9.9
      
8.9
      
11
  
Total
  
$
81.9
    
$
77.6
    
$
75.4
    
$
72.8
    
$
73.4
      
12
    
$
81.9
    
$
73.4
      
12
  
 
                                                                        
Average discount rate (J)
    
2.36
%
    
2.38
%
    
2.37
%
    
2.37
%
    
2.37
%
            
2.37
%
    
2.40
%
        
Average fee per card (dollars) (K)
  
$
52
    
$
51
    
$
51
    
$
51
    
$
49
      
6
    
$
51
    
$
49
      
4
  


 
See Appendix IV for footnote references

 
-4-



American Express Company
(Preliminary)
Selected Credit Related Statistical Information
 
 
 
 
 
 
 
(Billions, except percentages and where indicated)
 
 
 
 
 
 
 

 
  
Q4'18
    
Q3'18
    
Q2'18
    
Q1'18
    
Q4'17
    
YOY % change
    
YTD'18
    
YTD'17
    
YOY % change
  
Worldwide Card Member loans
                                                      
Total loans
  
$
81.9
    
$
77.6
    
$
75.4
    
$
72.8
    
$
73.4
      
12
    
$
81.9
    
$
73.4
      
12
  
Loss reserves (millions)
                                                                        
Beginning balance
  
$
1,937
    
$
1,840
    
$
1,786
    
$
1,706
    
$
1,502
      
29
    
$
1,706
    
$
1,223
      
39
  
Provisions - principal, interest and fees
    
679
      
560
      
528
      
499
      
596
      
14
      
2,266
      
1,868
      
21
  
Net write-offs - principal less recoveries
    
(399
)
    
(393
)
    
(389
)
    
(358
)
    
(325
)
    
23
      
(1,539
)
    
(1,181
)
    
30
  
Net write-offs - interest and fees less recoveries
    
(79
)
    
(77
)
    
(77
)
    
(71
)
    
(64
)
    
23
      
(304
)
    
(227
)
    
34
  
Other (L)
    
(4
)
    
7
      
(8
)
    
10
      
(3
)
    
33
      
5
      
23
      
(78
)
Ending balance
  
$
2,134
    
$
1,937
    
$
1,840
    
$
1,786
    
$
1,706
      
25
    
$
2,134
    
$
1,706
      
25
  
Ending reserves - principal
  
$
2,028
    
$
1,834
    
$
1,737
    
$
1,691
    
$
1,622
      
25
    
$
2,028
    
$
1,622
      
25
  
Ending reserves - interest and fees
  
$
106
    
$
103
    
$
103
    
$
95
    
$
84
      
26
    
$
106
    
$
84
      
26
  
% of loans
    
2.6
%
    
2.5
%
    
2.4
%
    
2.5
%
    
2.3
%
            
2.6
%
    
2.3
%
        
% of past due
    
182
%
    
185
%
    
188
%
    
174
%
    
177
%
            
182
%
    
177
%
        
Average loans
  
$
79.4
    
$
76.4
    
$
74.1
    
$
72.7
    
$
70.1
      
13
    
$
75.8
    
$
66.7
      
14
  
Net write-off rate (principal only) (M)
    
2.0
%
    
2.1
%
    
2.1
%
    
2.0
%
    
1.8
%
            
2.0
%
    
1.8
%
        
Net write-off rate (principal, interest and fees) (M)
    
2.4
%
    
2.5
%
    
2.5
%
    
2.4
%
    
2.2
%
            
2.4
%
    
2.1
%
        
30+ days past due as a % of total
    
1.4
%
    
1.3
%
    
1.3
%
    
1.4
%
    
1.3
%
            
1.4
%
    
1.3
%
        
   
Net interest income divided by average Card Member loans (N)
    
10.2
%
    
10.3
%
    
9.9
%
    
10.1
%
    
9.9
%
            
10.1
%
    
9.7
%
        
Net interest yield on average Card Member loans (N)
    
10.7
%
    
10.8
%
    
10.6
%
    
10.8
%
    
10.5
%
            
10.7
%
    
10.4
%
        
   
Worldwide Card Member receivables
                                                                        
Total receivables
  
$
55.9
    
$
55.5
    
$
55.0
    
$
54.2
    
$
54.0
      
4
    
$
55.9
    
$
54.0
      
4
  
Loss reserves (millions)
                                                                        
Beginning balance
  
$
544
    
$
558
    
$
565
    
$
521
    
$
512
      
6
    
$
521
    
$
467
      
12
  
Provisions - principal and fees
    
236
      
214
      
245
      
242
      
205
      
15
      
937
      
795
      
18
  
Net write-offs - principal and fees less recoveries
    
(198
)
    
(226
)
    
(236
)
    
(199
)
    
(188
)
    
5
      
(859
)
    
(736
)
    
17
  
Other (L)
    
(9
)
    
(2
)
    
(16
)
    
1
      
(8
)
    
13
      
(26
)
    
(5
)
    
#
  
Ending balance
  
$
573
    
$
544
    
$
558
    
$
565
    
$
521
      
10
    
$
573
    
$
521
      
10
  
% of receivables
    
1.0
%
    
1.0
%
    
1.0
%
    
1.0
%
    
1.0
%
            
1.0
%
    
1.0
%
        
Net write-off rate, excluding Global Corporate Payments (GCP) (principal only) (M)
    
1.4
%
    
1.7
%
    
1.8
%
    
1.6
%
    
1.5
%
            
1.7
%
    
1.6
%
        
Net write-off rate, excluding GCP (principal and fees) (M)
    
1.6
%
    
1.9
%
    
2.1
%
    
1.8
%
    
1.6
%
            
1.8
%
    
1.7
%
        
30+ days past due as a % of total, excluding GCP
    
1.4
%
    
1.3
%
    
1.3
%
    
1.5
%
    
1.4
%
            
1.4
%
    
1.4
%
        
GCP Net loss ratio (as a % of charge volume) (O)
    
0.11
%
    
0.12
%
    
0.12
%
    
0.10
%
    
0.11
%
            
0.11
%
    
0.10
%
        
GCP 90+ days past billing as a % of total (O)
    
0.7
%
    
0.8
%
    
0.8
%
    
0.8
%
    
0.9
%
            
0.7
%
    
0.9
%
        

# - Denotes a variance of 100 percent or more.


 
See Appendix IV for footnote references

 
-5-



American Express Company
(Preliminary)
Selected Income Statement Information by Segment
 
(Millions)
 
 
 

 
  
Global Consumer Services Group
    
Global Commercial Services
    
Global Merchant and Network Services
    
Corporate and Other
    
Consolidated
  
 
  
(GCSG)
    
(GCS)
    
(GMNS)
              
Q4'18
                              
Non-interest revenues
  
$
3,826
    
$
3,087
    
$
1,530
    
$
(1
)
  
$
8,442
  
Interest income
    
2,240
      
435
      
8
      
183
      
2,866
  
Interest expense
    
441
      
234
      
(89
)
    
248
      
834
  
Total revenues net of interest expense
    
5,625
      
3,288
      
1,627
      
(66
)
    
10,474
  
Total provision
    
726
      
223
      
6
      
(1
)
    
954
  
Total revenues net of interest expense after provisions for losses
    
4,899
      
3,065
      
1,621
      
(65
)
    
9,520
  
Marketing, business development, rewards, Card Member services
    
2,922
      
1,528
      
375
      
6
      
4,831
  
Salaries and employee benefits and other operating expenses
    
1,250
      
839
      
620
      
149
      
2,858
  
Pretax income (loss)
    
727
      
698
      
626
      
(220
)
    
1,831
  
Income tax provision (benefit)
    
25
      
74
      
125
      
(403
)
    
(179
)
Net income (loss)
    
702
      
624
      
501
      
183
      
2,010
  
Q4'17
                                        
Non-interest revenues
  
$
3,535
    
$
2,866
    
$
1,554
    
$
13
    
$
7,968
  
Interest income
    
1,848
      
357
      
10
      
104
      
2,319
  
Interest expense
    
306
      
168
      
(55
)
    
161
      
580
  
Total revenues net of interest expense
    
5,077
      
3,055
      
1,619
      
(44
)
    
9,707
  
Total provision
    
641
      
187
      
4
      
2
      
834
  
Total revenues net of interest expense after provisions for losses
    
4,436
      
2,868
      
1,615
      
(46
)
    
8,873
  
Marketing, business development, rewards, Card Member services
    
2,479
      
1,362
      
332
      
7
      
4,180
  
Salaries and employee benefits and other operating expenses
    
1,100
      
743
      
617
      
435
      
2,895
  
Pretax income (loss)
    
857
      
763
      
666
      
(488
)
    
1,798
  
Income tax provision (benefit)
    
233
      
221
      
207
      
2,343
      
3,004
  
Net income (loss)
    
624
      
542
      
459
      
(2,831
)
    
(1,206
)
YOY % change
                                        
Non-interest revenues
    
8
      
8
      
(2
)
    
#
      
6
  
Interest income
    
21
      
22
      
(20
)
    
76
      
24
  
Interest expense
    
44
      
39
      
62
      
54
      
44
  
Total revenues net of interest expense
    
11
      
8
      
-
      
50
      
8
  
Total provision
    
13
      
19
      
50
      
#
      
14
  
Total revenues net of interest expense after provisions for losses
    
10
      
7
      
-
      
41
      
7
  
Marketing, business development, rewards, Card Member services
    
18
      
12
      
13
      
(14
)
    
16
  
Salaries and employee benefits and other operating expenses
    
14
      
13
      
-
      
(66
)
    
(1
)
Pretax income (loss)
    
(15
)
    
(9
)
    
(6
)
    
(55
)
    
2
  
Income tax provision (benefit)
    
(89
)
    
(67
)
    
(40
)
    
#
      
#
  
Net income (loss)
    
13
      
15
      
9
      
#
      
#
  
 
                                        

# - Denotes a variance of 100 percent or more.
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 


 
See Appendix IV for footnote references

 
-6-




American Express Company
(Preliminary)
Billed Business Growth Trend
    
 
 
 
 

 
  
YOY % change
  
 
  
Reported
    
FX-Adjusted (P)
    
Reported
    
FX-Adjusted (P)
  
 
  
Q4'18
    
Q3'18
    
Q2'18
    
Q1'18
    
Q4'17
    
Q4'18
    
Q3'18
    
Q2'18
    
Q1'18
    
Q4'17
    
YTD'18
    
YTD'18
  
Worldwide
                                                                        
Proprietary consumer
    
10
%
    
11
%
    
13
%
    
15
%
    
11
%
    
11
%
    
12
%
    
12
%
    
12
%
    
10
%
    
12
%
    
12
%
Proprietary commercial
    
9
      
11
      
12
      
13
      
11
      
10
      
12
      
12
      
11
      
10
      
11
      
11
  
Proprietary
    
9
      
11
      
12
      
13
      
11
      
10
      
12
      
12
      
11
      
10
      
11
      
11
  
GNS
    
(9
)
    
(5
)
    
(1
)
    
8
      
9
      
(4
)
    
(1
)
    
(3
)
    
3
      
6
      
(2
)
    
(1
)
Total
    
6
      
8
      
10
      
12
      
11
      
8
      
10
      
9
      
10
      
9
      
9
      
9
  
Airline-related volume (7% of Q4'18 Worldwide Total)
    
5
      
7
      
8
      
10
      
7
      
8
      
9
      
7
      
6
      
4
      
8
      
7
  
 
                                                                                                
U.S.
                                                                                                
Proprietary consumer
    
9
      
10
      
10
      
11
      
8
      
n/a
      
n/a
      
n/a
      
n/a
      
n/a
      
10
      
n/a
  
Proprietary commercial
    
9
      
10
      
10
      
10
      
9
      
n/a
      
n/a
      
n/a
      
n/a
      
n/a
      
10
      
n/a
  
Proprietary
    
8
      
10
      
10
      
10
      
8
      
n/a
      
n/a
      
n/a
      
n/a
      
n/a
      
10
      
n/a
  
GNS
    
17
      
13
      
6
      
6
      
-
      
n/a
      
n/a
      
n/a
      
n/a
      
n/a
      
10
      
n/a
  
Total
    
9
      
10
      
10
      
10
      
8
      
n/a
      
n/a
      
n/a
      
n/a
      
n/a
      
10
      
n/a
  
T&E-related volume (23% of Q4'18 U.S. Total)
    
8
      
9
      
8
      
8
      
6
      
n/a
      
n/a
      
n/a
      
n/a
      
n/a
      
8
      
n/a
  
Non-T&E-related volume (77% of Q4'18 U.S. Total)
    
8
      
10
      
10
      
11
      
9
      
n/a
      
n/a
      
n/a
      
n/a
      
n/a
      
10
      
n/a
  
Airline-related volume (6% of Q4'18 U.S. Total)
    
9
      
11
      
7
      
7
      
5
      
n/a
      
n/a
      
n/a
      
n/a
      
n/a
      
8
      
n/a
  
 
                                                                                                
Outside the U.S.
                                                                                                
Proprietary consumer
    
11
      
14
      
20
      
25
      
20
      
17
      
18
      
18
      
16
      
14
      
17
      
17
  
Proprietary commercial
    
10
      
13
      
19
      
23
      
19
      
16
      
18
      
18
      
14
      
13
      
16
      
16
  
Proprietary
    
11
      
14
      
19
      
24
      
20
      
17
      
18
      
17
      
15
      
13
      
17
      
17
  
GNS
    
(11
)
    
(6
)
    
(2
)
    
8
      
10
      
(6
)
    
(3
)
    
(3
)
    
3
      
6
      
(3
)
    
(2
)
Total
    
1
      
5
      
10
      
17
      
15
      
7
      
8
      
8
      
9
      
10
      
8
      
8
  
Japan, Asia Pacific & Australia billed business
    
1
      
5
      
9
      
16
      
15
      
5
      
8
      
7
      
10
      
11
      
8
      
7
  
Latin America & Canada billed business
    
1
      
1
      
5
      
12
      
11
      
11
      
12
      
11
      
11
      
8
      
4
      
11
  
Europe, Middle East & Africa billed business
    
2
      
6
      
14
      
20
      
19
      
8
      
8
      
9
      
7
      
10
      
10
      
8
  


 
See Appendix IV for footnote references


-7-


Global Consumer Services Group
 
 (Preliminary)
Selected Income Statement and Statistical Information
(Millions, except percentages)

 
  
Q4'18
    
Q3'18
    
Q2'18
    
Q1'18
    
Q4'17
    
YOY % change
    
YTD'18
    
YTD'17
    
YOY % change
  
Non-interest revenues
  
$
3,826
    
$
3,680
    
$
3,678
    
$
3,491
    
$
3,535
      
8
    
$
14,675
    
$
13,378
      
10
  
Interest income
    
2,240
      
2,140
      
1,994
      
1,949
      
1,848
      
21
      
8,323
      
6,789
      
23
  
Interest expense
    
441
      
404
      
370
      
327
      
306
      
44
      
1,542
      
1,047
      
47
  
Net interest income
    
1,799
      
1,736
      
1,624
      
1,622
      
1,542
      
17
      
6,781
      
5,742
      
18
  
Total revenues net of interest expense
    
5,625
      
5,416
      
5,302
      
5,113
      
5,077
      
11
      
21,456
      
19,120
      
12
  
Provisions for losses
    
726
      
609
      
565
      
530
      
641
      
13
      
2,430
      
1,996
      
22
  
Total revenues net of interest expense after provisions for losses
    
4,899
      
4,807
      
4,737
      
4,583
      
4,436
      
10
      
19,026
      
17,124
      
11
  
Expenses
                                                                        
Marketing, business development, rewards, Card Member services
    
2,922
      
2,711
      
2,695
      
2,446
      
2,479
      
18
      
10,774
      
9,233
      
17
  
Salaries and employee benefits and other operating expenses
    
1,250
      
1,118
      
1,081
      
1,089
      
1,100
      
14
      
4,538
      
4,246
      
7
  
Total expenses
    
4,172
      
3,829
      
3,776
      
3,535
      
3,579
      
17
      
15,312
      
13,479
      
14
  
Pretax segment income
    
727
      
978
      
961
      
1,048
      
857
      
(15
)
    
3,714
      
3,645
      
2
  
Income tax provision
    
25
      
199
      
191
      
222
      
233
      
(89
)
    
637
      
1,053
      
(40
)
Segment income
  
$
702
    
$
779
    
$
770
    
$
826
    
$
624
      
13
    
$
3,077
    
$
2,592
      
19
  
Effective tax rate
    
3.4
%
    
20.3
%
    
19.9
%
    
21.2
%
    
27.2
%
            
17.2
%
    
28.9
%
        
   
(Billions, except percentages and where indicated)
                                                                        
Proprietary billed business (H)
                                                                        
U.S.
  
$
99.1
    
$
92.4
    
$
93.6
    
$
86.0
    
$
91.0
      
9
    
$
371.1
    
$
336.9
      
10
  
Outside the U.S.
  
$
37.5
    
$
34.9
    
$
34.6
    
$
33.3
    
$
33.8
      
11
    
$
140.3
    
$
119.8
      
17
  
Total
  
$
136.6
    
$
127.3
    
$
128.2
    
$
119.3
    
$
124.8
      
9
    
$
511.4
    
$
456.7
      
12
  
Proprietary cards-in-force (millions) (I)
                                                                        
U.S.
    
37.7
      
37.4
      
36.7
      
36.1
      
34.9
      
8
      
37.7
      
34.9
      
8
  
Outside the U.S.
    
16.8
      
16.7
      
16.5
      
16.2
      
15.8
      
6
      
16.8
      
15.8
      
6
  
Total
    
54.5
      
54.1
      
53.2
      
52.3
      
50.7
      
7
      
54.5
      
50.7
      
7
  
Proprietary basic cards-in-force (millions) (I)
                                                                        
U.S.
    
27.0
      
26.7
      
26.2
      
25.8
      
25.0
      
8
      
27.0
      
25.0
      
8
  
Outside the U.S.
    
11.6
      
11.6
      
11.4
      
11.2
      
10.9
      
6
      
11.6
      
10.9
      
6
  
Total
    
38.6
      
38.3
      
37.6
      
37.0
      
35.9
      
8
      
38.6
      
35.9
      
8
  
Average proprietary basic Card Member spending (dollars)
                                                                        
U.S
  
$
3,693
    
$
3,491
    
$
3,594
    
$
3,371
    
$
3,672
      
1
    
$
14,161
    
$
13,950
      
2
  
Outside the U.S.
  
$
3,240
    
$
3,038
    
$
3,057
    
$
3,001
    
$
3,106
      
4
    
$
12,348
    
$
11,225
      
10
  
Average
  
$
3,556
    
$
3,354
    
$
3,431
    
$
3,259
    
$
3,499
      
2
    
$
13,613
    
$
13,115
      
4
  
 
                                                                        
Segment assets (Q)
  
$
150.7
    
$
130.9
    
$
126.8
    
$
120.8
    
$
123.5
      
22
    
$
150.7
    
$
123.5
      
22
  
 
                                                                        
Card Member loans
                                                                        
Total loans
                                                                        
U.S.
  
$
59.9
    
$
56.2
    
$
54.7
    
$
52.7
    
$
53.7
      
12
    
$
59.9
    
$
53.7
      
12
  
Outside the U.S.
  
$
9.6
    
$
9.2
    
$
8.8
    
$
8.6
    
$
8.6
      
12
    
$
9.6
    
$
8.6
      
12
  
Total
  
$
69.5
    
$
65.4
    
$
63.5
    
$
61.3
    
$
62.3
      
12
    
$
69.5
    
$
62.3
      
12
  
 
                                                                        
Average loans
                                                                        
U.S.
  
$
57.8
    
$
55.5
    
$
53.7
    
$
52.9
    
$
51.1
      
13
    
$
55.1
    
$
49.0
      
12
  
Outside the U.S.
  
$
9.3
    
$
8.9
    
$
8.8
    
$
8.7
    
$
8.1
      
15
    
$
8.9
    
$
7.4
      
20
  
Total
  
$
67.1
    
$
64.4
    
$
62.5
    
$
61.6
    
$
59.2
      
13
    
$
64.0
    
$
56.4
      
13
  
 
                                                                        
Lending Credit Metrics
                                                                        
U.S.
                                                                        
Net write-off rate (principal only) (M)
    
2.1
%
    
2.1
%
    
2.2
%
    
2.0
%
    
1.9
%
            
2.1
%
    
1.8
%
        
Net write-off rate (principal, interest and fees) (M)
    
2.5
%
    
2.5
%
    
2.6
%
    
2.4
%
    
2.2
%
            
2.5
%
    
2.1
%
        
30+ days past due as a % of total
    
1.4
%
    
1.4
%
    
1.3
%
    
1.4
%
    
1.3
%
            
1.4
%
    
1.3
%
        
Outside the U.S.
                                                                        
Net write-off rate (principal only) (M)
    
2.0
%
    
2.2
%
    
2.1
%
    
2.1
%
    
2.0
%
            
2.1
%
    
2.1
%
        
Net write-off rate (principal, interest and fees) (M)
    
2.5
%
    
2.7
%
    
2.6
%
    
2.6
%
    
2.4
%
            
2.6
%
    
2.5
%
        
30+ days past due as a % of total
    
1.6
%
    
1.5
%
    
1.5
%
    
1.6
%
    
1.4
%
            
1.6
%
    
1.4
%
        
Total
                                                                        
Net write-off rate (principal only) (M)
    
2.1
%
    
2.1
%
    
2.2
%
    
2.0
%
    
1.9
%
            
2.1
%
    
1.8
%
        
Net write-off rate (principal, interest and fees) (M)
    
2.5
%
    
2.5
%
    
2.6
%
    
2.4
%
    
2.3
%
            
2.5
%
    
2.2
%
        
30+ days past due as a % of total
    
1.5
%
    
1.4
%
    
1.3
%
    
1.4
%
    
1.3
%
            
1.5
%
    
1.3
%
        
 
                                                                        
Net interest income divided by average Card Member loans (N)
    
10.7
%
    
10.8
%
    
10.4
%
    
10.5
%
    
10.4
%
            
10.6
%
    
10.2
%
        
Net interest yield on average Card Member loans (N)
                                                                        
U.S.
    
10.8
%
    
10.9
%
    
10.6
%
    
10.7
%
    
10.5
%
            
10.7
%
    
10.3
%
        
Outside the U.S.
    
10.5
%
    
10.6
%
    
10.5
%
    
11.0
%
    
10.8
%
            
10.6
%
    
11.1
%
        
Total
    
10.8
%
    
10.8
%
    
10.6
%
    
10.8
%
    
10.5
%
            
10.7
%
    
10.4
%
        
 
                                                                        
Card Member receivables
                                                                        
U.S.
  
$
13.7
    
$
11.9
    
$
12.0
    
$
11.7
    
$
13.1
      
5
    
$
13.7
    
$
13.1
      
5
  
Outside the U.S.
  
$
7.8
    
$
7.0
    
$
7.0
    
$
7.0
    
$
7.8
      
-
    
$
7.8
    
$
7.8
      
-
  
Total receivables
  
$
21.5
    
$
18.9
    
$
19.0
    
$
18.7
    
$
20.9
      
3
    
$
21.5
    
$
20.9
      
3
  
 
                                                                        
Charge Credit Metrics
                                                                        
U.S.
                                                                        
Net write-off rate (principal only) (M)
    
1.2
%
    
1.3
%
    
1.4
%
    
1.3
%
    
1.3
%
            
1.3
%
    
1.3
%
        
Net write-off rate (principal and fees) (M)
    
1.4
%
    
1.5
%
    
1.5
%
    
1.5
%
    
1.4
%
            
1.5
%
    
1.4
%
        
30+ days past due as a % of total
    
1.1
%
    
1.2
%
    
1.1
%
    
1.3
%
    
1.1
%
            
1.1
%
    
1.1
%
        
Outside the U.S.
                                                                        
Net write-off rate (principal only) (M)
    
2.0
%
    
2.3
%
    
2.1
%
    
2.0
%
    
1.8
%
            
2.1
%
    
2.0
%
        
Net write-off rate (principal and fees) (M)
    
2.1
%
    
2.5
%
    
2.3
%
    
2.2
%
    
1.9
%
            
2.3
%
    
2.1
%
        
30+ days past due as a % of total
    
1.3
%
    
1.4
%
    
1.4
%
    
1.5
%
    
1.3
%
            
1.3
%
    
1.3
%
        
Total
                                                                        
Net write-off rate (principal only) (M)
    
1.5
%
    
1.7
%
    
1.7
%
    
1.6
%
    
1.5
%
            
1.6
%
    
1.5
%
        
Net write-off rate (principal and fees) (M)
    
1.6
%
    
1.9
%
    
1.8
%
    
1.7
%
    
1.6
%
            
1.8
%
    
1.7
%
        
30+ days past due as a % of total
    
1.2
%
    
1.2
%
    
1.2
%
    
1.4
%
    
1.2
%
            
1.2
%
    
1.2
%
        




See Appendix IV for footnote references
 
-8-

 

Global Commercial Services
 
(Preliminary)
Selected Income Statement and Statistical Information
(Millions, except percentages)

 
  
Q4'18
    
Q3'18
    
Q2'18
    
Q1'18
    
Q4'17
    
YOY % change
    
YTD'18
    
YTD'17
    
YOY % change
  
Non-interest revenues
  
$
3,087
    
$
2,980
    
$
2,977
    
$
2,838
    
$
2,866
      
8
    
$
11,882
    
$
10,942
      
9
  
Interest income
    
435
      
416
      
393
      
377
      
357
      
22
      
1,621
      
1,361
      
19
  
Interest expense
    
234
      
218
      
204
      
171
      
168
      
39
      
827
      
595
      
39
  
Net interest income
    
201
      
198
      
189
      
206
      
189
      
6
      
794
      
766
      
4
  
Total revenues net of interest expense
    
3,288
      
3,178
      
3,166
      
3,044
      
3,055
      
8
      
12,676
      
11,708
      
8
  
Provisions for losses
    
223
      
201
      
235
      
240
      
187
      
19
      
899
      
743
      
21
  
Total revenues net of interest expense after provisions for losses
    
3,065
      
2,977
      
2,931
      
2,804
      
2,868
      
7
      
11,777
      
10,965
      
7
  
Expenses (Q)
                                                                        
Marketing, business development, rewards, Card Member services
    
1,528
      
1,469
      
1,482
      
1,374
      
1,362
      
12
      
5,853
      
5,311
      
10
  
Salaries and employee benefits and other operating expenses
    
839
      
734
      
734
      
722
      
743
      
13
      
3,029
      
2,811
      
8
  
Total expenses
    
2,367
      
2,203
      
2,216
      
2,096
      
2,105
      
12
      
8,882
      
8,122
      
9
  
Pretax segment income
    
698
      
774
      
715
      
708
      
763
      
(9
)
    
2,895
      
2,843
      
2
  
Income tax provision
    
74
      
168
      
151
      
162
      
221
      
(67
)
    
555
      
914
      
(39
)
Segment income
  
$
624
    
$
606
    
$
564
    
$
546
    
$
542
      
15
    
$
2,340
    
$
1,929
      
21
  
Effective tax rate
    
10.6
%
    
21.7
%
    
21.1
%
    
22.9
%
    
29.0
%
            
19.2
%
    
32.1
%
        
   
(Billions, except percentages and where indicated)
                                                                        
Proprietary billed business (H)
  
$
126.9
    
$
121.6
    
$
122.0
    
$
115.7
    
$
116.6
      
9
    
$
486.2
    
$
438.1
      
11
  
Proprietary cards-in-force (millions) (I)
    
14.5
      
14.4
      
14.3
      
14.1
      
14.0
      
4
      
14.5
      
14.0
      
4
  
Average Card Member spending (dollars)
  
$
8,757
    
$
8,469
    
$
8,592
    
$
8,233
    
$
8,356
      
5
    
$
34,058
    
$
31,729
      
7
  
 
                                                                        
Segment assets (Q)
  
$
51.8
    
$
54.0
    
$
52.9
    
$
52.1
    
$
49.1
      
5
    
$
51.8
    
$
49.1
      
5
  
Card Member loans
  
$
12.4
    
$
12.2
    
$
11.9
    
$
11.5
    
$
11.1
      
12
    
$
12.4
    
$
11.1
      
12
  
Card Member receivables
  
$
34.4
    
$
36.6
    
$
36.0
    
$
35.5
    
$
33.1
      
4
    
$
34.4
    
$
33.1
      
4
  
   
Card Member loans (R)
                                                                        
Total loans - Global Small Business Services (GSBS)
  
$
12.4
    
$
12.2
    
$
11.8
    
$
11.4
    
$
11.0
      
13
    
$
12.4
    
$
11.0
      
13
  
30+ days past due as a % of total - GSBS
    
1.3
%
    
1.1
%
    
1.2
%
    
1.3
%
    
1.2
%
            
1.3
%
    
1.2
%
        
Average loans - GSBS
  
$
12.3
    
$
11.9
    
$
11.6
    
$
11.1
    
$
10.9
      
13
    
$
11.7
    
$
10.3
      
14
  
Net write-off rate (principal only) - GSBS (M)
    
1.6
%
    
1.7
%
    
1.8
%
    
1.6
%
    
1.6
%
            
1.7
%
    
1.6
%
        
Net write-off rate (principal, interest and fees) - GSBS (M)
    
1.9
%
    
2.0
%
    
2.1
%
    
1.9
%
    
1.9
%
            
2.0
%
    
1.9
%
        
   
Net interest income divided by average Card Member loans (N)
    
6.5
%
    
6.6
%
    
6.5
%
    
7.4
%
    
6.9
%
            
6.7
%
    
7.4
%
        
Net interest yield on average Card Member loans (N)
    
10.5
%
    
10.5
%
    
10.4
%
    
10.7
%
    
10.5
%
            
10.5
%
    
10.8
%
        
 
                                                                        
Card Member receivables
                                                                        
Total receivables - GCP  (O)
  
$
17.7
    
$
19.7
    
$
19.3
    
$
19.3
    
$
17.0
      
4
    
$
17.7
    
$
17.0
      
4
  
90+ days past billing as a % of total - GCP (O)
    
0.7
%
    
0.8
%
    
0.8
%
    
0.8
%
    
0.9
%
            
0.7
%
    
0.9
%
        
Net loss ratio (as a % of charge volume) - GCP (O)
    
0.11
%
    
0.12
%
    
0.12
%
    
0.10
%
    
0.11
%
            
0.11
%
    
0.10
%
        
Total receivables - GSBS
  
$
16.7
    
$
16.9
    
$
16.7
    
$
16.2
    
$
16.1
      
4
    
$
16.7
    
$
16.1
      
4
  
30+ days past due as a % of total - GSBS
    
1.6
%
    
1.4
%
    
1.4
%
    
1.8
%
    
1.6
%
            
1.6
%
    
1.6
%
        
Net write-off rate (principal only) - GSBS (M)
    
1.4
%
    
1.8
%
    
2.1
%
    
1.7
%
    
1.5
%
            
1.7
%
    
1.6
%
        
Net write-off rate (principal and fees) - GSBS (M)
    
1.6
%
    
2.0
%
    
2.3
%
    
1.9
%
    
1.7
%
            
2.0
%
    
1.8
%
        



 
See Appendix IV for footnote references
 
-9-


Global Merchant and Network Services
 
(Preliminary)
Selected Income Statement and Statistical Information
 
 
 
 
 
 
 
 
 
 
 
 
 
 
(Millions, except percentages)
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 

 
  
Q4'18
    
Q3'18
    
Q2'18
    
Q1'18
    
Q4'17
    
YOY % change
    
YTD'18
    
YTD'17
    
YOY % change
  
Non-interest revenues
  
$
1,530
    
$
1,494
    
$
1,513
    
$
1,532
    
$
1,554
      
(2
)
  
$
6,069
    
$
6,025
      
1
  
Interest income
    
8
      
6
      
7
      
9
      
10
      
(20
)
    
30
      
42
      
(29
)
Interest expense
    
(89
)
    
(78
)
    
(68
)
    
(59
)
    
(55
)
    
62
      
(294
)
    
(188
)
    
56
  
Net interest income
    
97
      
84
      
75
      
68
      
65
      
49
      
324
      
230
      
41
  
Total revenues net of interest expense
    
1,627
      
1,578
      
1,588
      
1,600
      
1,619
      
-
      
6,393
      
6,255
      
2
  
Provisions for losses
    
6
      
5
      
6
      
5
      
4
      
50
      
22
      
16
      
38
  
Total revenues net of interest expense after provisions for losses
    
1,621
      
1,573
      
1,582
      
1,595
      
1,615
      
-
      
6,371
      
6,239
      
2
  
Expenses
                                                                        
Marketing, business development, rewards, Card Member services
    
375
      
296
      
312
      
267
      
332
      
13
      
1,250
      
1,227
      
2
  
Salaries and employee benefits and other operating expenses
    
620
      
511
      
526
      
620
      
617
      
-
      
2,277
      
2,367
      
(4
)
Total expenses
    
995
      
807
      
838
      
887
      
949
      
5
      
3,527
      
3,594
      
(2
)
Pretax segment income
    
626
      
766
      
744
      
708
      
666
      
(6
)
    
2,844
      
2,645
      
8
  
Income tax provision
    
125
      
186
      
201
      
192
      
207
      
(40
)
    
704
      
857
      
(18
)
Segment income
  
$
501
    
$
580
    
$
543
    
$
516
    
$
459
      
9
    
$
2,140
    
$
1,788
      
20
  
Effective tax rate
    
20.0
%
    
24.3
%
    
27.0
%
    
27.1
%
    
31.1
%
            
24.8
%
    
32.4
%
        
   
(Billions)
                                                                        
Segment assets (Q)
  
$
44.5
    
$
31.9
    
$
31.3
    
$
31.0
    
$
30.6
      
45
    
$
44.5
    
$
30.6
      
45
  



See Appendix IV for footnote references

 
-10-



American Express Company
(Preliminary)
Appendix I
 
Components of Return on Average Equity (ROE) and Return on Average Common Equity (ROCE)
(Millions, except percentages)
 

 
  
For the Twelve Months Ended
  
 
  
Dec 31,
    
Sep 30,
    
Jun 30,
    
Mar 31,
    
Dec 31,
  
 
  
2018
    
2018
    
2018
    
2018
    
2017
  
ROE
                              
Net income
  
$
6,921
    
$
3,705
    
$
3,410
    
$
3,131
    
$
2,748
  
Average shareholders' equity
  
$
20,650
    
$
20,421
    
$
20,393
    
$
20,536
    
$
20,857
  
Return on average equity (D)
    
33.5
%
    
18.1
%
    
16.7
%
    
15.2
%
    
13.2
%
   
Reconciliation of ROCE
                                        
Net income
  
$
6,921
    
$
3,705
    
$
3,410
    
$
3,131
    
$
2,748
  
Preferred shares dividends and related accretion
    
80
      
81
      
82
      
81
      
81
  
Earnings allocated to participating share awards and other
    
54
      
40
      
38
      
37
      
21
  
Net income attributable to common shareholders
  
$
6,787
    
$
3,584
    
$
3,290
    
$
3,013
    
$
2,646
  
   
Average shareholders' equity
  
$
20,650
    
$
20,421
    
$
20,393
    
$
20,536
    
$
20,857
  
Average preferred shares
    
1,584
      
1,584
      
1,584
      
1,584
      
1,584
  
Average common shareholders' equity
  
$
19,066
    
$
18,837
    
$
18,809
    
$
18,952
    
$
19,273
  
Return on average common equity (D)
    
35.6
%
    
19.0
%
    
17.5
%
    
15.9
%
    
13.7
%



See Appendix IV for footnote references

 
-11-


American Express Company
 
(Preliminary)
Appendix II
  
 
  
 
 
 
Net Interest Yield on Average Card Member Loans
  
 
 
 
 
 
(Millions, except percentages and where indicated)
 
 
 
 
 
 
 
 
 
 
  
 
 
 

 
  
Q4'18
    
Q3'18
    
Q2'18
    
Q1'18
    
Q4'17
    
YTD'18
    
YTD'17
  
Consolidated
                                          
Net interest income
  
$
2,032
    
$
1,961
    
$
1,829
    
$
1,841
    
$
1,739
    
$
7,663
    
$
6,451
  
Exclude:
                                                        
Interest expense not attributable to the Company's Card Member loan portfolio (S)
    
405
      
390
      
359
      
302
      
297
      
1,456
      
1,149
  
Interest income not attributable to the Company's Card Member loan portfolio (T)
    
(287
)
    
(274
)
    
(236
)
    
(213
)
    
(177
)
    
(1,010
)
    
(637
)
Adjusted net interest income (U)
  
$
2,150
    
$
2,077
    
$
1,952
    
$
1,930
    
$
1,859
    
$
8,109
    
$
6,963
  
Average Card Member loans (billions)
  
$
79.4
    
$
76.4
    
$
74.1
    
$
72.7
    
$
70.1
    
$
75.8
    
$
66.7
  
Net interest income divided by average Card Member loans (V)
    
10.2
%
    
10.3
%
    
9.9
%
    
10.1
%
    
9.9
%
    
10.1
%
    
9.7
%
Net interest yield on average Card Member loans (W)
    
10.7
%
    
10.8
%
    
10.6
%
    
10.8
%
    
10.5
%
    
10.7
%
    
10.4
%
   
U.S.
                                                        
Net interest income
  
$
1,571
    
$
1,511
    
$
1,410
    
$
1,403
    
$
1,337
    
$
5,895
    
$
4,961
  
Exclude:
                                                        
Interest expense not attributable to the Company's Card Member loan portfolio (S)
    
57
    
$
55
    
$
53
    
$
37
    
$
45
      
202
      
164
  
Interest income not attributable to the Company's Card Member loan portfolio (T)
    
(51
)
    
(46
)
    
(42
)
    
(39
)
    
(31
)
    
(178
)
    
(101
)
Adjusted net interest income (U)
  
$
1,577
    
$
1,520
    
$
1,421
    
$
1,401
    
$
1,351
    
$
5,919
    
$
5,024
  
Average Card Member loans (billions)
  
$
57.8
    
$
55.5
    
$
53.7
    
$
52.9
    
$
51.1
    
$
55.1
    
$
48.9
  
Net interest income divided by average Card Member loans (V)
    
10.9
%
    
10.9
%
    
10.5
%
    
10.6
%
    
10.5
%
    
10.7
%
    
10.1
%
Net interest yield on average Card Member loans (W)
    
10.8
%
    
10.9
%
    
10.6
%
    
10.7
%
    
10.5
%
    
10.7
%
    
10.3
%
   
Outside the U.S.
                                                        
Net interest income
  
$
228
    
$
225
    
$
215
    
$
218
    
$
205
    
$
886
    
$
781
  
Exclude:
                                                        
Interest expense not attributable to the Company's Card Member loan portfolio (S)
    
18
      
18
      
16
      
18
      
17
      
70
      
54
  
Interest income not attributable to the Company's Card Member loan portfolio (T)
    
-
      
(3
)
    
(2
)
    
(3
)
    
(1
)
    
(8
)
    
(8
)
Adjusted net interest income (U)
  
$
246
    
$
240
    
$
229
    
$
233
    
$
221
    
$
948
    
$
827
  
Average Card Member loans (billions)
  
$
9.3
    
$
8.9
    
$
8.8
    
$
8.6
    
$
8.1
    
$
8.9
    
$
7.4
  
Net interest income divided by average Card Member loans (V)
    
9.8
%
    
10.1
%
    
9.8
%
    
10.1
%
    
10.1
%
    
10.0
%
    
10.6
%
Net interest yield on average Card Member loans (W)
    
10.5
%
    
10.6
%
    
10.5
%
    
11.0
%
    
10.8
%
    
10.6
%
    
11.1
%
                                                         
Global Consumer Services Group
                                                        
Net interest income
  
$
1,799
    
$
1,736
    
$
1,624
    
$
1,622
    
$
1,542
    
$
6,781
    
$
5,742
  
Exclude:
                                                        
Interest expense not attributable to the Company's Card Member loan portfolio (S)
    
75
    
$
73
    
$
70
    
$
54
    
$
62
      
272
      
218
  
Interest income not attributable to the Company's Card Member loan portfolio (T)
    
(51
)
    
(49
)
    
(45
)
    
(41
)
    
(32
)
    
(186
)
    
(110
)
Adjusted net interest income (U)
  
$
1,823
    
$
1,760
    
$
1,649
    
$
1,635
    
$
1,572
    
$
6,867
    
$
5,850
  
Average Card Member loans (billions)
  
$
67.1
    
$
64.4
    
$
62.5
    
$
61.6
    
$
59.2
    
$
64.0
    
$
56.4
  
Net interest income divided by average Card Member loans (V)
    
10.7
%
    
10.8
%
    
10.4
%
    
10.5
%
    
10.4
%
    
10.6
%
    
10.2
%
Net interest yield on average Card Member loans (W)
    
10.8
%
    
10.8
%
    
10.6
%
    
10.8
%
    
10.5
%
    
10.7
%
    
10.4
%
   
Global Commercial Services
                                                        
Net interest income
  
$
201
    
$
198
    
$
189
    
$
206
    
$
189
    
$
794
    
$
766
  
Exclude:
                                                        
Interest expense not attributable to the Company's Card Member loan portfolio (S)
    
170
      
161
      
152
      
126
      
128
      
609
      
461
  
Interest income not attributable to the Company's Card Member loan portfolio (T)
    
(44
)
    
(42
)
    
(38
)
    
(37
)
    
(30
)
    
(161
)
    
(114
)
Adjusted net interest income (U)
  
$
327
    
$
317
    
$
303
    
$
295
    
$
287
    
$
1,242
    
$
1,113
  
Average Card Member loans (billions)
  
$
12.4
    
$
12.0
    
$
11.7
    
$
11.2
    
$
10.9
    
$
11.8
    
$
10.3
  
Net interest income divided by average Card Member loans (V)
    
6.5
%
    
6.6
%
    
6.5
%
    
7.4
%
    
6.9
%
    
6.7
%
    
7.4
%
Net interest yield on average Card Member loans (W)
    
10.5
%
    
10.5
%
    
10.4
%
    
10.7
%
    
10.5
%
    
10.5
%
    
10.8
%


 
See Appendix IV for footnote references

 
-12-




American Express Company
(Preliminary)
Appendix III
 
 
 
Reconciliations of Adjustments
 
 
 

   
Q4'18
  
Effective Tax Rate Excluding Discrete Tax Items
      
Effective tax rate
    
(9.8
%)
Discrete tax impacts (X)
    
27.1
%
Effective tax rate excluding discrete tax items
    
17.3
%



 
See Appendix IV for footnote references

 
-13-



Appendix IV
(Preliminary)

All Information in the preceding tables is presented on a basis prepared in conformity with accounting principles generally accepted in the United States of America (GAAP), unless otherwise indicated.  Certain reclassifications of prior period amounts have been made to conform to the current period presentation.

(A)
 
Effective January 1, 2018, includes reclassification of certain business development expenses from Other expenses to Marketing and business development that are not directly attributable to the adoption of the new revenue recognition guidance.  Prior periods have been conformed to the current period presentation.
(B)
 
Represents net income (loss), less (i) earnings allocated to participating share awards of $16 million, $13 million, $12 million,  $13 million and $2 million in Q4'18, Q3'18, Q2'18, Q1'18 and Q4'17, respectively; and (ii) dividends on preferred shares of $19 million, $20 million, $20 million, $21 million and $20 million in Q4'18, Q3'18, Q2'18, Q1'18 and Q4'17, respectively.
(C)
 
Within assets, "other" includes the following items as presented in the Company's Consolidated Balance Sheets: Other receivables, Other loans (including merchant financing loans), Premises and equipment and Other assets; and within liabilities, "other" includes the following items: Travelers Cheques and other prepaid products, Accounts payable and Other liabilities.
(D)
 
Return on average equity and return on average common equity are calculated by dividing one year period net income/net income attributable to common shareholders by one year average total shareholders' equity/average common shareholders' equity, respectively.  Refer to Appendix I for components of return on average equity and return on average common equity.
(E)
 
Effective January 1, 2018, we have exited transitional Basel III reporting and our ratios exclude all transitional provisions.  Current ratios represent preliminary estimates as of the date of Fourth Quarter 2018 Earnings Release and may be revised in the Company's 2018 Form 10-K for period ended December 31, 2018.
(F)
 
Supplementary Leverage Ratio is calculated by dividing Tier 1 capital by total leverage exposure under Basel III.  Leverage exposure, which reflects average total consolidated assets with adjustments for Tier 1 capital deductions, average off-balance sheet derivatives exposures, securities purchased under agreements to resell and credit equivalents of undrawn commitments that are both conditionally and unconditionally cancellable.
(G)
 
Presented for the purpose of calculating the Tier 1 Leverage Ratio.
(H)
 
Billed business represents transaction volumes (including cash advances) on cards and other payment products issued by American Express (proprietary billed business) and cards issued under network partnership agreements with banks and other institutions, including joint ventures (GNS billed business).  In-store spending activity within GNS retail cobrand portfolios, from which we earn no revenue, is not included in billed business.  Billed business is reported as United States or outside the United States based on the location of the issuer.
(I)
 
Cards-in-force represents the number of cards that are issued and outstanding by American Express (proprietary cards-in-force) and cards issued and outstanding under network partnership agreements with banks and other institutions, including joint ventures (GNS cards-in-force) except for GNS retail cobrand cards that have no out of store spend activity during the prior 12 months.
Basic cards-in-force excludes supplemental cards issued on consumer accounts.
(J)
 
This calculation is generally designed to reflect the average pricing at all merchants accepting American Express cards and represents the percentage of proprietary and GNS billed business retained by the Company from merchants it acquires, or from merchants acquired by third parties on its behalf, net of amounts retained by such third parties.  Effective January 1, 2018, the Company began including billed business related to certain business-to-business products in the calculation of the average discount rate to reflect our expanding business-to-business product offerings.  Prior periods have been conformed to the current period presentation.
(K)
 
Average fee per card is computed based on proprietary basic net card fees divided by average proprietary basic cards-in-force.
(L)
 
Other includes foreign currency impact on balance sheet re-measurement and translation.
(M)
 
The Company presents a net write-off rate based on principal losses only (i.e., excluding interest and/or fees) to be consistent with industry convention.  In addition, as the Company's practice is to include uncollectible interest and/or fees as part of its total provision for losses, a net write-off rate including principal, interest and/or fees is also presented.
(N)
 
See Appendix II for calculations of net interest yield on average Card Member loans, a non-GAAP measure, and net interest income divided by average Card Member loans, a GAAP measure, and the Company's rationale for presenting net interest yield on average Card Member loans (refer to Footnotes "V" and "W").
(O)
 
GCP reflects global, large and middle market corporate accounts.  GCP delinquency data for periods other than 90+ days past billing is not available due to system constraints.  GCP Net loss ratio — Represents the ratio of GCP charge card write-offs, consisting of principal (resulting from authorized transactions) and fee components, less recoveries, on Card Member receivables expressed as a percentage of gross amounts billed to corporate Card Members.
(P)
 
FX-adjusted information assumes a constant exchange rate between the periods being compared for purposes of currency translation into U.S. dollars (i.e., assumes the foreign exchange rates used to determine results for Q4'18 apply to the period(s) against which such results are being compared).  The Company believes the presentation of information on an FX-adjusted basis is helpful to investors by making it easier to compare the Company's performance in one period to that of another period without the variability caused by fluctuations in currency exchange rates.
(Q)
 
Includes changes in certain corporate allocations that are not directly attributable to our new segment structure effective Q2'18 and reflects changes in intercompany settlement process implemented effective Q4'18.
(R)
 
Effective Q3'17, GSBS loans and associated metrics reflect worldwide small business services loans.  Prior to Q3'17, due to certain system limitations, small business services loans outside the U.S. and associated credit metrics are reflected within GCSG, and were not significant to either GCSG or GCS.
(S)
 
Primarily represents interest expense attributable to maintaining our corporate liquidity pool and funding Card Member receivables.
(T)
 
Primarily represents interest income attributable to Other loans, interest-bearing deposits and the fixed income investment portfolios.
(U)
 
Adjusted net interest income is a non-GAAP measure that represents net interest income attributable to our Card Member loans (which includes, on a GAAP basis, interest that is deemed uncollectible), excluding the impact of interest expense and interest income not attributable to our Card Member loans.  The Company believes adjusted net interest income is useful to investors because it represents the interest expense and interest income attributable to our Card Member loan portfolio and is a component of net interest yield on average Card Member loans, which provides a measure of profitability of our Card Member loan portfolio.
(V)
 
Net interest income divided by average Card Member loans, computed on an annualized basis, a GAAP measure, includes elements of total interest income and total interest expense that are not attributable to the Card Member loan portfolio, and thus is not representative of net interest yield on average Card Member loans.
(W)
 
Net interest yield on average Card Member loans is a non-GAAP measure that is computed by dividing adjusted net interest income by average Card Member loans, computed on an annualized basis.  Reserves and net write-offs related to uncollectible interest are recorded through provisions for losses, and thus not included in the net interest yield calculation.  The Company believes that  net interest yield on average Card Member loans is useful to investors because it provides a measure of profitability of the Company's Card Member loan portfolio.
(X)
 
Reflects changes in the tax method of accounting for certain expenses, the resolution of certain prior years' tax audits and an adjustment to the Company's 2017 provisional tax charge related to the Tax Act.
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