0001104659-07-024028.txt : 20070330 0001104659-07-024028.hdr.sgml : 20070330 20070330124515 ACCESSION NUMBER: 0001104659-07-024028 CONFORMED SUBMISSION TYPE: 8-K PUBLIC DOCUMENT COUNT: 2 CONFORMED PERIOD OF REPORT: 20070330 ITEM INFORMATION: Regulation FD Disclosure FILED AS OF DATE: 20070330 DATE AS OF CHANGE: 20070330 FILER: COMPANY DATA: COMPANY CONFORMED NAME: AMERICAN EXPRESS CO CENTRAL INDEX KEY: 0000004962 STANDARD INDUSTRIAL CLASSIFICATION: FINANCE SERVICES [6199] IRS NUMBER: 134922250 STATE OF INCORPORATION: NY FISCAL YEAR END: 1231 FILING VALUES: FORM TYPE: 8-K SEC ACT: 1934 Act SEC FILE NUMBER: 001-07657 FILM NUMBER: 07730956 BUSINESS ADDRESS: STREET 1: 200 VESEY STREET STREET 2: 50TH FLOOR CITY: NEW YORK STATE: NY ZIP: 10285 BUSINESS PHONE: 2126402000 MAIL ADDRESS: STREET 1: 200 VESEY STREET STREET 2: 50TH FLOOR CITY: NEW YORK STATE: NY ZIP: 10285 8-K 1 a07-9379_18k.htm 8-K

UNITED STATES
SECURITIES AND EXCHANGE COMMISSION

WASHINGTON, D.C. 20549

FORM 8-K

CURRENT REPORT

Pursuant to Section 13 or 15(d) of the Securities Exchange Act of 1934

Date of Report (Date of earliest event reported) March 30, 2007

AMERICAN EXPRESS COMPANY

(Exact Name of Registrant as Specified in Its Charter)

New York		1-7657		13-4922250
(State or Other Jurisdiction of Incorporation)		(Commission File Number)		(IRS Employer Identification No.)

200 Vesey Street, World Financial Center
New York, New York		10285
(Address of Principal Executive Offices)		(Zip Code)

(212) 640-2000

(Registrant’s Telephone Number, Including Area Code)

None

(Former Name or Former Address, if Changed Since Last Report)

Check the appropriate box below if the Form 8-K filing is intended to simultaneously satisfy the filing obligation of the registrant under any of the following provisions (see General Instruction A.2. below):

o Written communications pursuant to Rule 425 under the Securities Act (17 CFR 230.425)

o Soliciting material pursuant to Rule 14a-12 under the Exchange Act (17 CFR 240.14a-12)

o Pre-commencement communications pursuant to Rule 14d-2(b) under the Exchange Act (17 CFR 240.14d-2(b))

o Pre-commencement communications pursuant to Rule 13e-4(c) under the Exchange Act (17 CFR 240.13e-4(c))

Item 7.01 Regulation FD Disclosure

Beginning with the first quarter of 2007, American Express Company (the “Company”) will revise the presentation of its Consolidated Statements of Income. The revised Consolidated Statements of Income include the separate presentation of certain interest income and interest expense amounts which previously had been reported on a net basis as well as the separate presentation of the provisions for losses and benefits from expenses.

While these revisions impact the presentation of revenues and expenses in the Company’s Consolidated Statements of Income, they have no impact on the Company’s previously reported consolidated pretax income, income taxes, net income, total assets, total liabilities, or total shareholders’ equity.

The revised consolidated presentation will include the following:

· Gross cardmember lending finance charge revenue will be presented in the line entitled “Cardmember lending finance charge revenue” within the new “Interest income” section of the Consolidated Statements of Income, and the related gross interest expense will be presented in the line entitled “Cardmember lending” within the new “Interest expense” section of the Consolidated Statements of Income. These amounts were previously presented on a net basis as “Cardmember lending finance charge revenue, net of interest” within the “Net revenues” section;

· Gross investment and other interest income will be presented in the lines entitled “International banking” or “Other” within the new “Interest income” section, and gross interest expense related to international banking will be presented in “International banking” within the new “Interest expense” section. These amounts were previously presented on a net basis as “Other investment and interest income, net of interest” within the “Net revenues” section;

· Other interest expense will be presented in the line entitled “Charge card and other” within the new “Interest expense” section, and certain other interest income will be presented in the line entitled “Other” within the new “Interest income” section. These amounts were previously reported on a net basis in “Interest” within the “Expenses” section;

· “Provisions for losses and benefits” will be presented in a new separate section. These amounts were previously reported in the “Provisions for losses and benefits” lines within the “Expenses” section; and

· Certain other amounts have been revised to conform with the method of presentation or calculation that will be used in 2007.

Corresponding revisions to the Selected Income Statement Data presentation regarding the Company’s reportable operating segments have been made as reflected in the attached exhibit.

“Total revenues” and “Revenues net of interest expense” will be presented separately within the revised Consolidated Statements of Income presentation. “Revenues net of interest expense” will be the measure for the Company’s long-term revenue growth rate target. This target (of at least 8 percent growth on average and over time) has not been changed as a result of the revisions to the presentation of the Consolidated Statements of Income.

The changes in the presentation of the Company’s Consolidated Statements of Income are being made in connection with discussions that the Company has had with the staff of the U.S. Securities and Exchange Commission (SEC) related to a review of the Company’s Form 10-K for the year ended December 31, 2005.

Separately, the Company will revise the method of reporting certain credit statistics related to the charge card business to better align these metrics with the way the Company manages credit risk as well as to align such credit statistics with the method used for reporting the Company’s lending activities. Historically, the credit statistics for the charge card business have been presented using the portion of the account balance that was 90 days past due or more. However, the Company’s practices for managing credit risk and establishing reserves for uncollectible amounts consider the entire amounts of customer accounts for those accounts which have any portion that is past due by 90 days or more. The Company has determined that the disclosure of credit statistics for the charge card business in a manner consistent with the internal methodology used for reserving practices is preferable. Because the Company’s existing risk management assessments already utilize this methodology, the level of reserves has not been changed. The new statistics do not indicate a change in management’s view of the Company’s underlying credit quality, risk profile or adequacy of reserves. Revised historical statistics using this new reporting method are presented in the accompanying exhibit.

The calculation of the ratio of earnings to fixed charges will be changed to reflect the revised amount of gross interest expense as presented in the Consolidated Statements of Income. In addition, the calculation of net finance charge revenue divided by average loans for both consolidated reporting and the International Card & Global Commercial Services segment has been corrected for a computational error. This correction has a minimal impact on the historic trends for this statistical information.

As disclosed in the Company’s Form 10-K for the year ended December 31, 2006, the Company is continuing to discuss comments made by the staff of the SEC regarding the aggregation of segment data in the Company’s Consolidated Financial Statements under Statement of Financial Accounting Standards No. 131, “Disclosures about Segments of an Enterprise and Related Information.” The attached exhibit does not reflect any changes to the composition of the Company’s segments as presented in the Company’s Form 10-K for the year ended December 31, 2006. If, as a result of these discussions, it is concluded that a different reportable operating segment presentation (including the disaggregation of certain operating segments) is appropriate, the Company’s segments would be reported differently in the Company’s filings with the SEC (although consolidated results would not be impacted).

The financial and statistical information reflecting the revisions described above for the years ended December 31, 2006 and 2005 and the quarters ended March 31, June 30, September 30, and December 31, 2006 and 2005, is furnished herein in Exhibit 99.1 and is incorporated herein by reference.

Exhibit 99.1

-American Express Company Consolidated Statements of Income (Revised) for the quarters ended March 31, June 30, September 30, and December 31, 2006 and 2005 and the years ended December 31, 2006 and 2005.

-American Express Company Consolidated Statements of Income for the years ended December 31, 2006 and 2005 and the quarters ended March 31, June 30, September 30, and December 31, 2006 and 2005.

-American Express Company Financial Summary for the years ended December 31, 2006 and 2005 and quarters ended March 31, June 30, September 30, and December 31, 2006 and 2005.

-American Express Company Selected Statistical Information for the years ended December 31, 2006 and 2005 and quarters ended March 31, June 30, September 30, and December 31, 2006 and 2005.

-U.S. Card Services Selected Income Statement Data for the quarters ended March 31, June 30, September 30, and December 31, 2006 and 2005 and the years ended December 31, 2006 and 2005.

-U.S. Card Services Selected Financial Information for the quarters ended March 31, June 30, September 30, and December 31, 2006 and 2005 and the years ended December 31, 2006 and 2005.

-U.S. Card Services Selected Statistical Information for the quarters ended March 31, June 30, September 30, and December 31, 2006 and 2005 and the years ended December 31, 2006 and 2005.

-International Card & Global Commercial Services Selected Income Statement Data for the quarters ended March 31, June 30, September 30, and December 31, 2006 and 2005 and the years ended December 31, 2006 and 2005.

-International Card & Global Commercial Services Selected Statistical Information for the quarters ended March 31, June 30, September 30, and December 31, 2006 and 2005 and the years ended December 31, 2006 and 2005.

-Global Network & Merchant Services Selected Income Statement Data for the quarters ended March 31, June 30, September 30, and December 31, 2006 and 2005 and the years ended December 31, 2006 and 2005.

-American Express Company Computation in Support of Ratio of Earnings to Fixed Charges for the years ended December 31, 2006, 2005, 2004, and 2003.

SIGNATURE

Pursuant to the requirements of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned hereunto duly authorized.

DATE: March 30, 2007

		AMERICAN EXPRESS COMPANY
		(REGISTRANT)

		By:	/s/ Stephen P. Norman
		Name: Stephen P. Norman
		Title: Secretary

EXHIBIT INDEX

Item No.		Description

99.1
		-American Express Company Consolidated Statements of Income (Revised) for the quarters ended March 31, June 30, September 30, and December 31, 2006 and 2005 and the years ended December 31, 2006 and 2005.
		-American Express Company Consolidated Statements of Income for the years ended December 31, 2006 and 2005 and the quarters ended March 31, June 30, September 30, and December 31, 2006 and 2005.
		-American Express Company Financial Summary for the years ended December 31, 2006 and 2005 and quarters ended March 31, June 30, September 30, and December 31, 2006 and 2005.
		-American Express Company Selected Statistical Information for the years ended December 31, 2006 and 2005 and quarters ended March 31, June 30, September 30, and December 31, 2006 and 2005.
		-U.S. Card Services Selected Income Statement Data for the quarters ended March 31, June 30, September 30, and December 31, 2006 and 2005 and the years ended December 31, 2006 and 2005.
		-U.S. Card Services Selected Financial Information for the quarters ended March 31, June 30, September 30, and December 31, 2006 and 2005 and the years ended December 31, 2006 and 2005.
		-U.S. Card Services Selected Statistical Information for the quarters ended March 31, June 30, September 30, and December 31, 2006 and 2005 and the years ended December 31, 2006 and 2005.
		-International Card & Global Commercial Services Selected Income Statement Data for the quarters ended March 31, June 30, September 30, and December 31, 2006 and 2005 and the years ended December 31, 2006 and 2005.
		-International Card & Global Commercial Services Selected Statistical Information for the quarters ended March 31, June 30, September 30, and December 31, 2006 and 2005 and the years ended December 31, 2006 and 2005.
		-Global Network & Merchant Services Selected Income Statement Data for the quarters ended March 31, June 30, September 30, and December 31, 2006 and 2005 and the years ended December 31, 2006 and 2005.
		-American Express Company Computation in Support of Ratio of Earnings to Fixed Charges for the years ended December 31, 2006, 2005, 2004, and 2003.

EX-99.1 2 a07-9379_1ex99d1.htm EX-99.1

EXHIBIT 99.1

All information in the following tables is presented on a basis prepared in accordance with U.S. generally accepted accounting principles (GAAP), unless otherwise indicated. For a reconciliation from the revised presentation below to the historical presentation, see page 3.

American Express Company

Consolidated Statements of Income (Revised)

(unaudited)

(Millions)
	Quarters Ended
	December 31,			September 30,		June 30,			March 31,			December 31,
	2006			2006		2006			2006			2005

Revenues
Discount revenue	$	3,458		$	3,259	$	3,292		$	2,969		$	3,096
Net card fees	479			462		533			520			518
Travel commissions and fees	450			427		483			418			435
Other commissions and fees	654			620		642			639			630
Securitization income, net	347			384		372			386			295
Other	565			431		415			396			424
Total	5,953			5,583		5,737			5,328			5,398
Interest income:
Cardmember lending finance charge revenue	1,326			1,213		1,100			947			943
International banking	279			265		252			257			248
Other	203			203		196			188			182
Total	1,808			1,681		1,548			1,392			1,373
Total revenues	7,761			7,264		7,285			6,720			6,771
Interest expense:
Cardmember lending	351			318		277			246			255
International banking	123			106		93			88			90
Charge card and other	417			405		373			333			295
Total	891			829		743			667			640
Revenues net of interest expense	6,870			6,435		6,542			6,053			6,131

Expenses
Marketing, promotion, rewards and cardmember services	1,734			1,589		1,671			1,522			1,581
Human resources	1,336			1,213		1,276			1,240			1,177
Professional services	807			684		658			561			714
Occupancy and equipment	405			375		365			346			390
Communications	116			107		113			113			115
Other	358			331		287			278			382
Total	4,756			4,299		4,370			4,060			4,359
Provisions for losses and benefits:
Charge card	277			257		192			209			290
Cardmember lending	484			412		406			321			415
International banking and other (including investment certificates)	130			129		132			138			108
Total	891			798		730			668			813
Pretax income from continuing operations	1,223			1,338		1,442			1,325			959
Income tax provision	298			382		470			449			208
Income from continuing operations	925			956		972			876			751
(Loss) Income from discontinued operations, net of tax	(3		)	11		(27		)	(3		)	(6		)
Net income	$	922		$	967	$	945		$	873		$	745

American Express Company

Consolidated Statements of Income (Revised)

(unaudited)

(Millions)
	Quarters Ended						Years Ended
	September 30,		June 30,		March 31,		December 31,			December 31,
	2005		2005		2005		2006			2005

Revenues
Discount revenue	$	2,894	$	2,860	$	2,639	$	12,978		$	11,489
Net card fees	511		506		498		1,994			2,033
Travel commissions and fees	421		502		422		1,778			1,780
Other commissions and fees	598		589		558		2,555			2,375
Securitization income, net	353		296		316		1,489			1,260
Other	357		361		354		1,807			1,496
Total	5,134		5,114		4,787		22,601			20,433
Interest income:
Cardmember lending finance charge revenue	858		824		754		4,586			3,379
International banking	230		211		213		1,053			902
Other	149		193		181		790			705
Total	1,237		1,228		1,148		6,429			4,986
Total revenues	6,371		6,342		5,935		29,030			25,419
Interest expense:
Cardmember lending	219		199		174		1,192			847
International banking	81		76		69		410			316
Charge card and other	281		279		253		1,528			1,108
Total	581		554		496		3,130			2,271
Revenues net of interest expense	5,790		5,788		5,439		25,900			23,148

Expenses
Marketing, promotion, rewards and cardmember services	1,492		1,445		1,323		6,516			5,841
Human resources	1,197		1,268		1,187		5,065			4,829
Professional services	563		544		487		2,710			2,308
Occupancy and equipment	346		356		336		1,491			1,428
Communications	112		113		117		449			457
Other	261		309		312		1,254			1,264
Total	3,971		4,035		3,762		17,485			16,127
Provisions for losses and benefits:
Charge card	299		234		215		935			1,038
Cardmember lending	364		275		295		1,623			1,349
International banking and other (including investment certificates)	76		123		79		529			386
Total	739		632		589		3,087			2,773
Pretax income from continuing operations	1,080		1,121		1,088		5,328			4,248
Income tax provision	215		261		343		1,599			1,027
Income from continuing operations	865		860		745		3,729			3,221
(Loss) Income from discontinued operations, net of tax	165		153		201		(22		)	513
Net income	$	1,030	$	1,013	$	946	$	3,707		$	3,734

American Express Company

Consolidated Statements of Income

(unaudited)

(Millions)
	Year Ended December 31, 2006									Year Ended December 31, 2005
	Historical,									Historical,
	as reported			Adjustments			Revised			as reported		Adjustments			Revised

Revenues
Discount revenue	$	12,978		$	—		$	12,978		$	11,489	$	—		$	11,489
Cardmember lending finance charge revenue, net of interest (A)	3,457			(3,457		)	—			2,580		(2,580		)	—
Net card fees	1,994			—			1,994			2,033		—			2,033
Travel commissions and fees	1,778			—			1,778			1,780		—			1,780
Other commissions and fees	2,555			—			2,555			2,375		—			2,375
Securitization income, net	1,489			—			1,489			1,260		—			1,260
Other investment and interest income, net of interest (B)	1,078			(1,078		)	—			1,055		(1,055		)	—
Other	1,807			—			1,807			1,496		—			1,496
Total	27,136			(4,535		)	22,601			24,068		(3,635		)	20,433
Interest income:
Cardmember lending finance charge revenue (A) (E)	—			4,586			4,586			—		3,379			3,379
International banking (B) (E)	—			1,053			1,053			—		902			902
Other (B) (D) (E)	—			790			790			—		705			705
Total	—			6,429			6,429			—		4,986			4,986
Total revenues	27,136			1,894			29,030			24,068		1,351			25,419
Interest expense:
Cardmember lending (A) (E)	—			1,192			1,192			—		847			847
International banking (B) (E)	—			410			410			—		316			316
Charge card and other (D) (E)	—			1,528			1,528			—		1,108			1,108
Total	—			3,130			3,130			—		2,271			2,271
Revenues net of interest expense	27,136			(1,236		)	25,900			24,068		(920		)	23,148

Expenses
Marketing, promotion, rewards and cardmember services	6,516			—			6,516			5,841		—			5,841
Human resources	5,065			—			5,065			4,829		—			4,829
Provisions for losses and benefits:	—			—
Charge card (C)	935			(935		)	—			1,038		(1,038		)	—
Cardmember lending (C)	1,623			(1,623		)	—			1,349		(1,349		)	—
Investment certificates and other (C)	529			(529		)	—			386		(386		)	—
Total (C)	3,087			(3,087		)	—			2,773		(2,773		)	—
Professional services	2,710			—			2,710			2,308		—			2,308
Occupancy and equipment	1,491			—			1,491			1,428		—			1,428
Interest (D)	1,236			(1,236		)	—			920		(920		)	—
Communications	449			—			449			457		—			457
Other	1,254			—			1,254			1,264		—			1,264
Total	21,808			(4,323		)	17,485			19,820		(3,693		)	16,127
Provisions for losses and benefits:
Charge card (C)	—			935			935			—		1,038			1,038
Cardmember lending (C)	—			1,623			1,623			—		1,349			1,349
International banking and other (including investment certificates) (C)	—			529			529			—		386			386
Total	—			3,087			3,087			—		2,773			2,773
Pretax income from continuing operations	5,328			—			5,328			4,248		—			4,248
Income tax provision	1,599			—			1,599			1,027		—			1,027
Income from continuing operations	3,729			—			3,729			3,221		—			3,221
(Loss) Income from discontinued operations, net of tax	(22		)	—			(22		)	513		—			513
Net income	$	3,707		$	—		$	3,707		$	3,734	$	—		$	3,734

(A) Gross cardmember lending finance charge revenue will be presented in the line entitled “Cardmember lending finance charge revenue” within the new “Interest income” section of the Consolidated Statements of Income, and the related gross interest expense will be presented in the line entitled “Cardmember lending” within the new “Interest expense” section of the Consolidated Statements of Income. (These sections were also affected by other revisions as indicated in the notes below.) These amounts were previously presented on a net basis as “Cardmember lending finance charge revenue, net of interest” within the “Net revenues” section.

(B) Gross investment and other interest income will be presented in the lines entitled “International banking” or “Other” within the new “Interest income” section, and gross interest expense related to international banking will be presented in “International banking” within the new “Interest expense” section. These amounts were previously presented on a net basis as “Other investment and interest income, net of interest” within the “Net revenues” section.

(C) “Provisions for losses and benefits” will be presented in a new separate section. These amounts were previously reported in the “Provisions for losses and benefits” lines within the “Expenses” section.

(D) Other interest expense will be presented in the line entitled “Charge card and other” within the new “Interest expense” section, and certain other interest income will be presented in the line entitled “Other” within the new “Interest income” section. These amounts were previously reported on a net basis in “Interest” within the “Expenses” section.

(E) Certain other amounts have been revised to conform with the method of presentation or calculation that will be used in 2007.

American Express Company

Consolidated Statements of Income

(unaudited)

(Millions)
	Quarter Ended March 31, 2006									Quarter Ended March 31, 2005
	Historical,									Historical,
	as reported			Adjustments			Revised			as reported		Adjustments			Revised
Revenues
Discount revenue	$	2,969		$	—		$	2,969		$	2,639	$	—		$	2,639
Cardmember lending finance charge revenue, net of interest	716			(716		)	—			592		(592		)	—
Net card fees	520			—			520			498		—			498
Travel commissions and fees	418			—			418			422		—			422
Other commissions and fees	639			—			639			558		—			558
Securitization income, net	386			—			386			316		—			316
Other investment and interest income, net of interest	275			(275		)	—			261		(261		)	—
Other	396			—			396			354		—			354
Total	6,319			(991		)	5,328			5,640		(853		)	4,787
Interest income:
Cardmember lending finance charge revenue	—			947			947			—		754			754
International banking	—			257			257			—		213			213
Other	—			188			188			—		181			181
Total	—			1,392			1,392			—		1,148			1,148
Total revenues	6,319			401			6,720			5,640		295			5,935
Interest expense:
Cardmember lending	—			246			246			—		174			174
International banking	—			88			88			—		69			69
Charge card and other	—			333			333			—		253			253
Total	—			667			667			—		496			496
Revenues net of interest expense	6,319			(266		)	6,053			5,640		(201		)	5,439

Expenses
Marketing, promotion, rewards and cardmember services	1,522			—			1,522			1,323		—			1,323
Human resources	1,240			—			1,240			1,187		—			1,187
Provisions for losses and benefits:
Charge card	209			(209		)	—			215		(215		)	—
Cardmember lending	321			(321		)	—			295		(295		)	—
Investment certificates and other	138			(138		)	—			79		(79		)	—
Total	668			(668		)	—			589		(589		)	—
Professional services	561			—			561			487		—			487
Occupancy and equipment	346			—			346			336		—			336
Interest	266			(266		)	—			201		(201		)	—
Communications	113			—			113			117		—			117
Other	278			—			278			312		—			312
Total	4,994			(934		)	4,060			4,552		(790		)	3,762
Provisions for losses and benefits:
Charge card	—			209			209			—		215			215
Cardmember lending	—			321			321			—		295			295
International banking and other (including investment certificates)	—			138			138			—		79			79
Total	—			668			668			—		589			589
Pretax income from continuing operations	1,325			—			1,325			1,088		—			1,088
Income tax provision	449			—			449			343		—			343
Income from continuing operations	876			—			876			745		—			745
(Loss) Income from discontinued operations, net of tax	(3		)	—			(3		)	201		—			201
Net income	$	873		$	—		$	873		$	946	$	—		$	946

American Express Company

Consolidated Statements of Income

(unaudited)

(Millions)
	Quarter Ended June 30, 2006									Quarter Ended June 30, 2005
	Historical,									Historical,
	as reported			Adjustments			Revised			as reported		Adjustments			Revised
Revenues
Discount revenue	$	3,292		$	—		$	3,292		$	2,860	$	—		$	2,860
Cardmember lending finance charge revenue, net of interest	839			(839		)	—			637		(637		)	—
Net card fees	533			—			533			506		—			506
Travel commissions and fees	483			—			483			502		—			502
Other commissions and fees	642			—			642			589		—			589
Securitization income, net	372			—			372			296		—			296
Other investment and interest income, net of interest	274			(274		)	—			269		(269		)	—
Other	415			—			415			361		—			361
Total	6,850			(1,113		)	5,737			6,020		(906		)	5,114
Interest income:
Cardmember lending finance charge revenue	—			1,100			1,100			—		824			824
International banking	—			252			252			—		211			211
Other	—			196			196			—		193			193
Total	—			1,548			1,548			—		1,228			1,228
Total revenues	6,850			435			7,285			6,020		322			6,342
Interest expense:
Cardmember lending	—			277			277			—		199			199
International banking	—			93			93			—		76			76
Charge card and other	—			373			373			—		279			279
Total	—			743			743			—		554			554
Revenues net of interest expense	6,850			(308		)	6,542			6,020		(232		)	5,788

Expenses
Marketing, promotion, rewards and cardmember services	1,671			—			1,671			1,445		—			1,445
Human resources	1,276			—			1,276			1,268		—			1,268
Provisions for losses and benefits:
Charge card	192			(192		)	—			234		(234		)	—
Cardmember lending	406			(406		)	—			275		(275		)	—
Investment certificates and other	132			(132		)	—			123		(123		)	—
Total	730			(730		)	—			632		(632		)	—
Professional services	658			—			658			544		—			544
Occupancy and equipment	365			—			365			356		—			356
Interest	308			(308		)	—			232		(232		)	—
Communications	113			—			113			113		—			113
Other	287			—			287			309		—			309
Total	5,408			(1,038		)	4,370			4,899		(864		)	4,035
Provisions for losses and benefits:
Charge card	—			192			192			—		234			234
Cardmember lending	—			406			406			—		275			275
International banking and other (including investment certificates)	—			132			132			—		123			123
Total	—			730			730			—		632			632
Pretax income from continuing operations	1,442			—			1,442			1,121		—			1,121
Income tax provision	470			—			470			261		—			261
Income from continuing operations	972			—			972			860		—			860
(Loss) Income from discontinued operations, net of tax	(27		)	—			(27		)	153		—			153
Net income	$	945		$	—		$	945		$	1,013	$	—		$	1,013

American Express Company

Consolidated Statements of Income

(unaudited)

(Millions)
	Quarter Ended September 30, 2006							Quarter Ended September 30, 2005
	Historical,							Historical,
	as reported		Adjustments			Revised		as reported		Adjustments			Revised
Revenues
Discount revenue	$	3,259	$	—		$	3,259	$	2,894	$	—		$	2,894
Cardmember lending finance charge revenue, net of interest	912		(912		)	—		648		(648		)	—
Net card fees	462		—			462		511		—			511
Travel commissions and fees	427		—			427		421		—			421
Other commissions and fees	620		—			620		598		—			598
Securitization income, net	384		—			384		353		—			353
Other investment and interest income, net of interest	264		(264		)	—		246		(246		)	—
Other	431		—			431		357		—			357
Total	6,759		(1,176		)	5,583		6,028		(894		)	5,134
Interest income:
Cardmember lending finance charge revenue	—		1,213			1,213		—		858			858
International banking	—		265			265		—		230			230
Other	—		203			203		—		149			149
Total	—		1,681			1,681		—		1,237			1,237
Total revenues	6,759		505			7,264		6,028		343			6,371
Interest expense:
Cardmember lending	—		318			318		—		219			219
International banking	—		106			106		—		81			81
Charge card and other	—		405			405		—		281			281
Total	—		829			829		—		581			581
Revenues net of interest expense	6,759		(324		)	6,435		6,028		(238		)	5,790

Expenses
Marketing, promotion, rewards and cardmember services	1,589		—			1,589		1,492		—			1,492
Human resources	1,213		—			1,213		1,197		—			1,197
Provisions for losses and benefits:
Charge card	257		(257		)	—		299		(299		)	—
Cardmember lending	412		(412		)	—		364		(364		)	—
Investment certificates and other	129		(129		)	—		76		(76		)	—
Total	798		(798		)	—		739		(739		)	—
Professional services	684		—			684		563		—			563
Occupancy and equipment	375		—			375		346		—			346
Interest	324		(324		)	—		238		(238		)	—
Communications	107		—			107		112		—			112
Other	331		—			331		261		—			261
Total	5,421		(1,122		)	4,299		4,948		(977		)	3,971
Provisions for losses and benefits:
Charge card	—		257			257		—		299			299
Cardmember lending	—		412			412		—		364			364
International banking and other (including investment certificates)	—		129			129		—		76			76
Total	—		798			798		—		739			739
Pretax income from continuing operations	1,338		—			1,338		1,080		—			1,080
Income tax provision	382		—			382		215		—			215
Income from continuing operations	956		—			956		865		—			865
Income from discontinued operations, net of tax	11		—			11		165		—			165
Net income	$	967	$	—		$	967	$	1,030	$	—		$	1,030

American Express Company

Consolidated Statements of Income

(unaudited)

(Millions)
	Quarter Ended December 31, 2006									Quarter Ended December 31, 2005
	Historical,									Historical,
	as reported			Adjustments			Revised			as reported			Adjustments			Revised
Revenues
Discount revenue	$	3,458		$	—		$	3,458		$	3,096		$	—		$	3,096
Cardmember lending finance charge revenue, net of interest	990			(990		)	—			703			(703		)	—
Net card fees	479			—			479			518			—			518
Travel commissions and fees	450			—			450			435			—			435
Other commissions and fees	654			—			654			630			—			630
Securitization income, net	347			—			347			295			—			295
Other investment and interest income, net of interest	265			(265		)	—			279			(279		)	—
Other	565			—			565			424			—			424
Total	7,208			(1,255		)	5,953			6,380			(982		)	5,398
Interest income:
Cardmember lending finance charge revenue	—			1,326			1,326			—			943			943
International banking	—			279			279			—			248			248
Other	—			203			203			—			182			182
Total	—			1,808			1,808			—			1,373			1,373
Total revenues	7,208			553			7,761			6,380			391			6,771
Interest expense:
Cardmember lending	—			351			351			—			255			255
International banking	—			123			123			—			90			90
Charge card and other	—			417			417			—			295			295
Total	—			891			891			—			640			640
Revenues net of interest expense	7,208			(338		)	6,870			6,380			(249		)	6,131

Expenses
Marketing, promotion, rewards and cardmember services	1,734			—			1,734			1,581			—			1,581
Human resources	1,336			—			1,336			1,177			—			1,177
Provisions for losses and benefits:
Charge card	277			(277		)	—			290			(290		)	—
Cardmember lending	484			(484		)	—			415			(415		)	—
Investment certificates and other	130			(130		)	—			108			(108		)	—
Total	891			(891		)	—			813			(813		)	—
Professional services	807			—			807			714			—			714
Occupancy and equipment	405			—			405			390			—			390
Interest	338			(338		)	—			249			(249		)	—
Communications	116			—			116			115			—			115
Other	358			—			358			382			—			382
Total	5,985			(1,229		)	4,756			5,421			(1,062		)	4,359
Provisions for losses and benefits:
Charge card	—			277			277			—			290			290
Cardmember lending	—			484			484			—			415			415
International banking and other (including investment certificates)	—			130			130			—			108			108
Total	—			891			891			—			813			813
Pretax income from continuing operations	1,223			—			1,223			959			—			959
Income tax provision	298			—			298			208			—			208
Income from continuing operations	925			—			925			751			—			751
Loss from discontinued operations, net of tax	(3		)	—			(3		)	(6		)	—			(6		)
Net income	$	922		$	—		$	922		$	745		$	—		$	745

American Express Company

Financial Summary

(unaudited)

(Millions)
	Year Ended December 31, 2006									Year Ended December 31, 2005
	Historical,									Historical,
	as reported			Adjustments			Revised			as reported			Adjustments			Revised
Revenues net of interest expense
U.S. Card Services (A)	$	13,955		$	(799	)	$	13,156		$	11,978		$	(562	)	$	11,416
International Card & Global Commercial Services (B)	9,464			(500		)	8,964			8,905			(389		)	8,516
Global Network & Merchant Services (C)	3,161			183			3,344			2,747			145			2,892
	26,580			(1,116		)	25,464			23,630			(806		)	22,824
Corporate & Other, including adjustments and eliminations	556			(120		)	436			438			(114		)	324

CONSOLIDATED REVENUES NET OF INTEREST EXPENSE	$	27,136		$	(1,236	)	$	25,900		$	24,068		$	(920	)	$	23,148

Pretax income (loss) from continuing operations
U.S. Card Services	$	3,305		$	—		$	3,305		$	2,571		$	—		$	2,571
International Card & Global Commercial Services	1,148			—			1,148			1,093			—			1,093
Global Network & Merchant Services	1,188			—			1,188			882			—			882
	5,641			—			5,641			4,546			—			4,546

Corporate & Other	(313		)	$	—		(313		)	(298		)	$	—		(298		)

PRETAX INCOME FROM CONTINUING OPERATIONS	$	5,328					$	5,328		$	4,248					$	4,248

Net income (loss)
U.S. Card Services	$	2,277		$	—		$	2,277		$	1,816		$	—		$	1,816
International Card & Global Commercial Services	885			—			885			899			—			899
Global Network & Merchant Services	779			—			779			573			—			573
	3,941			—			3,941			3,288			—			3,288

Corporate & Other	(212		)	$	—		(212		)	(67		)	$	—		(67		)
Income from continuing operations	3,729						3,729			3,221						3,221
(Loss) Income from discontinued operations, net of tax	(22		)				(22		)	513						513

NET INCOME	$	3,707					$	3,707		$	3,734					$	3,734

(A) For further information regarding these adjustments, see U.S. Card Services’ Statements of Income on page 15 of this exhibit.

(B) For further information regarding these adjustments, see International Card & Global Commercial Services’ Statements of Income on page 19 of this exhibit.

(C) For further information regarding these adjustments, see Global Network & Merchant Services’ Statements of Income on page 22 of this exhibit.

American Express Company

Financial Summary

(unaudited)

(Millions)
	Quarter Ended March 31, 2006									Quarter Ended March 31, 2005
	Historical,									Historical,
	as reported			Adjustments			Revised			as reported			Adjustments			Revised
Revenues net of interest expense
U.S. Card Services	$	3,180		$	(170	)	$	3,010		$	2,777		$	(123	)	$	2,654
International Card & Global Commercial Services	2,303			(102		)	2,201			2,146			(86		)	2,060
Global Network & Merchant Services	705			43			748			638			31			669
	6,188			(229		)	5,959			5,561			(178		)	5,383
Corporate & Other, including adjustments and eliminations	131			(37		)	94			79			(23		)	56

CONSOLIDATED REVENUES NET OF INTEREST EXPENSE	$	6,319		$	(266	)	$	6,053		$	5,640		$	(201	)	$	5,439

Pretax income (loss) from continuing operations
U.S. Card Services	$	796		$	—		$	796		$	703		$	—		$	703
International Card & Global Commercial Services	311			—			311			242			—			242
Global Network & Merchant Services	262			—			262			171			—			171
	1,369			—			1,369			1,116			—			1,116

Corporate & Other	(44		)	$	—		(44		)	(28		)	$	—		(28		)

PRETAX INCOME FROM CONTINUING OPERATIONS	$	1,325					$	1,325		$	1,088					$	1,088

Net income (loss)
U.S. Card Services	$	546		$	—		$	546		$	482		$	—		$	482
International Card & Global Commercial Services	213			—			213			192			—			192
Global Network & Merchant Services	166			—			166			111			—			111
	925			—			925			785			—			785

Corporate & Other	(49		)	$	—		(49		)	(40		)	$	—		(40		)
Income from continuing operations	876						876			745						745
(Loss) Income from discontinued operations, net of tax	(3		)				(3		)	201						201

NET INCOME	$	873					$	873		$	946					$	946

American Express Company

Financial Summary

(unaudited)

(Millions)
	Quarter Ended June 30, 2006									Quarter Ended June 30, 2005
	Historical,									Historical,
	as reported			Adjustments			Revised			as reported			Adjustments			Revised
Revenues net of interest expense
U.S. Card Services	$	3,485		$	(197	)	$	3,288		$	2,976		$	(126	)	$	2,850
International Card & Global Commercial Services	2,441			(121		)	2,320			2,248			(93		)	2,155
Global Network & Merchant Services	789			50			839			691			36			727
	6,715			(268		)	6,447			5,915			(183		)	5,732
Corporate & Other, including adjustments and eliminations	135			(40		)	95			105			(49		)	56

CONSOLIDATED REVENUES NET OF INTEREST EXPENSE	$	6,850		$	(308	)	$	6,542		$	6,020		$	(232	)	$	5,788

Pretax income (loss) from continuing operations
U.S. Card Services	$	920		$	—		$	920		$	697		$	—		$	697
International Card & Global Commercial Services	294			—			294			244			—			244
Global Network & Merchant Services	315			—			315			245			—			245
	1,529			—			1,529			1,186			—			1,186

Corporate & Other	(87		)	$	—		(87		)	(65		)	$	—		(65		)

PRETAX INCOME FROM CONTINUING OPERATIONS	$	1,442					$	1,442		$	1,121					$	1,121

Net income (loss)
U.S. Card Services	$	616		$	—		$	616		$	477		$	—		$	477
International Card & Global Commercial Services	225			—			225			225			—			225
Global Network & Merchant Services	200			—			200			155			—			155
	1,041			—			1,041			857			—			857

Corporate & Other	(69		)	$	—		(69		)	3			$	—		3
Income from continuing operations	972						972			860						860
(Loss) Income from discontinued operations, net of tax	(27		)				(27		)	153						153

NET INCOME	$	945					$	945		$	1,013					$	1,013

American Express Company

Financial Summary

(unaudited)

(Millions)	Quarter Ended September 30, 2006									Quarter Ended September 30, 2005
	Historical,									Historical,
	as reported			Adjustments			Revised			as reported			Adjustments			Revised
Revenues net of interest expense
U.S. Card Services	$	3,534		$	(215	)	$	3,319		$	3,044		$	(152	)	$	2,892
International Card & Global Commercial Services	2,287			(131		)	2,156			2,212			(107		)	2,105
Global Network & Merchant Services	798			43			841			693			35			728
	6,619			(303		)	6,316			5,949			(224		)	5,725
Corporate & Other, including adjustments and eliminations	140			(21		)	119			79			(14		)	65

CONSOLIDATED REVENUES NET OF INTEREST EXPENSE	$	6,759		$	(324	)	$	6,435		$	6,028		$	(238	)	$	5,790

Pretax income (loss) from continuing operations
U.S. Card Services	$	819		$	—		$	819		$	633		$	—		$	633
International Card & Global Commercial Services	281			—			281			317			—			317
Global Network & Merchant Services	314			—			314			214			—			214
	1,414			—			1,414			1,164			—			1,164

Corporate & Other	(76		)	$	—		(76		)	(84		)	$	—		(84		)

PRETAX INCOME FROM CONTINUING OPERATIONS	$	1,338					$	1,338		$	1,080					$	1,080

Net income (loss)
U.S. Card Services	$	580		$	—		$	580		$	443		$	—		$	443
International Card & Global Commercial Services	216			—			216			249			—			249
Global Network & Merchant Services	212			—			212			141			—			141
	1,008			—			1,008			833			—			833

Corporate & Other	(52		)	$	—		(52		)	32			$	—		32
Income from continuing operations	956						956			865						865
Income from discontinued operations, net of tax	11						11			165						165

NET INCOME	$	967					$	967		$	1,030					$	1,030

American Express Company

Financial Summary

(unaudited)

(Millions)	Quarter Ended December 31, 2006									Quarter Ended December 31, 2005
	Historical,									Historical
	as reported			Adjustments			Revised			as reported			Adjustments			Revised
Revenues net of interest expense
U.S. Card Services	$	3,756		$	(217	)	$	3,539		$	3,181		$	(161	)	$	3,020
International Card & Global Commercial Services	2,433			(146		)	2,287			2,299			(103		)	2,196
Global Network & Merchant Services	869			47			916			725			43			768
	7,058			(316		)	6,742			6,205			(221		)	5,984
Corporate & Other, including adjustments and eliminations	150			(22		)	128			175			(28		)	147

CONSOLIDATED REVENUES NET OF INTEREST EXPENSE	$	7,208		$	(338	)	$	6,870		$	6,380		$	(249	)	$	6,131

Pretax income (loss) from continuing operations
U.S. Card Services	$	770		$	—		$	770		$	538		$	—		$	538
International Card & Global Commercial Services	262			—			262			290			—			290
Global Network & Merchant Services	297			—			297			252			—			252
	1,329			—			1,329			1,080			—			1,080

Corporate & Other	(106		)	$	—		(106		)	(121		)	$	—		(121		)

PRETAX INCOME FROM CONTINUING OPERATIONS	$	1,223					$	1,223		$	959					$	959

Net income (loss)
U.S. Card Services	$	535		$	—		$	535		$	414		$	—		$	414
International Card & Global Commercial Services	231			—			231			233			—			233
Global Network & Merchant Services	201			—			201			166			—			166
	967			—			967			813			—			813

Corporate & Other	(42		)	$	—		(42		)	(62		)	$	—		(62		)
Income from continuing operations	925						925			751						751
Loss from discontinued operations, net of tax	(3		)				(3		)	(6		)				(6		)

NET INCOME	$	922					$	922		$	745					$	745

American Express Company

Selected Statistical Information

(unaudited)

	Quarters Ended
	December 31,		September 30,		June 30,		March 31,		December 31,
	2006		2006		2006		2006		2005
Historical, as reported:
Worldwide cardmember receivables:
90 days past due as a % of total (A)	1.8	%	1.8	%	1.8	%	1.8	%	1.6	%
Loss reserves as a % of 90 days past due (A)	147	%	149	%	150	%	163	%	177	%

Worldwide cardmember lending — owned basis (B):
Net finance charge revenue (C)/average loans (D)	9.8	%	9.6	%	9.6	%	8.9	%	9.0	%

Worldwide cardmember lending — managed basis (E):
Net finance charge revenue (C)/average loans (D)	9.5	%	9.6	%	9.5	%	9.1	%	9.4	%

	Quarters Ended
	December 31,		September 30,		June 30,		March 31,		December 31,
	2006		2006		2006		2006		2005
Revised:
Worldwide cardmember receivables:
90 days past due as a % of total (A)	2.8	%	2.8	%	2.8	%	3.1	%	2.8	%
Loss reserves as a % of 90 days past due (A)	95	%	97	%	98	%	97	%	97	%

Worldwide cardmember lending — owned basis (B):
Net finance charge revenue (C)/average loans (D)	9.6	%	9.5	%	9.4	%	8.8	%	8.9	%

Worldwide cardmember lending — managed basis (E):
Net finance charge revenue (C)/average loans (D)	9.4	%	9.4	%	9.4	%	9.0	%	9.3	%

(A) The Company will revise the method of reporting certain credit statistics related to the charge card business to better align these metrics with the way the Company manages credit risk as well as to align such credit statistics with the method used for reporting the Company’s lending activities. Historically, the credit statistics for the charge card business have been presented using the portion of the account balance that was 90 days past due or more. However, the Company’s practices for managing credit risk and establishing reserves for uncollectible amounts consider the entire amounts of customer accounts for those accounts which have any portion that is past due by 90 days or more. The Company has determined that the disclosure of credit statistics for the charge card business in a manner consistent with the internal methodology used for reserving practices is preferable. Because the Company’s existing risk management assessments already utilize this methodology, the level of reserves has not been changed. The new statistics do not indicate a change in management’s view of the Company’s underlying credit quality, risk profile or adequacy of reserves. Revised historical statistics using this new reporting method are presented above.

(B) “Owned,” a GAAP basis measurement, reflects only cardmember loans included on the Company’s Consolidated Balance Sheets.

(D) The calculation of net finance charge revenue divided by average loans has been corrected for a computational error. This correction has a minimal impact on the historic trends for this statistical information.

(E) Includes on-balance sheet cardmember loans and off-balance sheet securitized cardmember loans. The difference between the “owned basis” (GAAP) information and “managed basis” information is attributable to the effects of securitization activities. For more information about this difference, see also “Differences between GAAP and Managed Basis Presentation” on page 55 in the Company’s 2006 Annual Report, which is filed with the SEC as Exhibit 13 to the Company’s 2006 Form 10-K Report.

American Express Company

Selected Statistical Information

(unaudited)

	Quarters Ended						Years Ended
	September 30,		June 30,		March 31,		December 31,		December 31,
	2005		2005		2005		2006		2005
Historical, as reported:
Worldwide cardmember receivables:
90 days past due as a % of total (A)	1.7	%	1.7	%	1.9	%	1.8	%	1.6	%
Loss reserves as a % of 90 days past due (A)	173	%	160	%	147	%	147	%	177	%

Worldwide cardmember lending — owned basis (B):
Net finance charge revenue (C)/average loans (D)	9.2	%	9.3	%	9.0	%	9.5	%	9.1	%

Worldwide cardmember lending — managed basis (E):
Net finance charge revenue (C)/average loans (D)	9.4	%	9.2	%	9.1	%	9.4	%	9.3	%

	Quarters Ended						Years Ended
	September 30,		June 30,		March 31,		December 31,		December 31,
	2005		2005		2005		2006		2005
Revised:
Worldwide cardmember receivables:
90 days past due as a % of total (A)	2.7	%	2.5	%	2.7	%	2.8	%	2.8	%
Loss reserves as a % of 90 days past due (A)	104	%	106	%	101	%	95	%	97	%

Worldwide cardmember lending — owned basis (B):
Net finance charge revenue (C)/average loans (D)	9.0	%	9.1	%	8.8	%	9.3	%	8.9	%

Worldwide cardmember lending — managed basis (E):
Net finance charge revenue (C)/average loans (D)	9.3	%	9.1	%	9.0	%	9.3	%	9.2	%

(B) “Owned,” a GAAP basis measurement, reflects only cardmember loans included on the Company’s Consolidated Balance Sheets.

U.S. Card Services

Selected Income Statement Data

(unaudited)

(Millions)
	Quarters Ended
	December 31,		September 30,		June 30,		March 31,		December 31,
	2006		2006		2006		2006		2005
Historical, as reported:
Revenues
Discount revenue, net card fees and other	$	2,679	$	2,482	$	2,514	$	2,314	$	2,401
Finance charge revenue	1,018		928		814		674		685
Less: Interest expense	288		260		215		194		200
Securitization income:
Excess spread, net (excluding servicing fees)	246		279		261		269		183
Servicing fees	101		100		100		106		105
Gains on sales from securitizations	—		5		11		11		7
Securitization income, net	347		384		372		386		295
Total revenues	3,756		3,534		3,485		3,180		3,181
Interest expense:
Cardmember lending	—		—		—		—		—
Charge card and other	—		—		—		—		—
Revenues net of interest expense	3,756		3,534		3,485		3,180		3,181
Expenses
Marketing, promotion, rewards and cardmember services	1,242		1,127		1,106		1,034		1,097
Human resources and other operating expenses	1,218		1,142		1,108		1,043		1,037
Provisions for losses	526		446		351		307		509
Total	2,986		2,715		2,565		2,384		2,643
Pretax segment income	770		819		920		796		538
Income tax provision	235		239		304		250		124
Segment income	$	535	$	580	$	616	$	546	$	414

	Quarters Ended
	December 31,			September 30,			June 30,			March 31,			December 31,
	2006			2006			2006			2006			2005
Adjustments:
Revenues
Discount revenue, net card fees and other	$	—		$	—		$	—		$	—		$	—
Finance charge revenue	—			—			—			—			—
Less: Interest expense (A)	(288		)	(260		)	(215		)	(194		)	(200		)
Securitization income:
Excess spread, net (excluding servicing fees)	—			—			—			—			—
Servicing fees	—			—			—			—			—
Gains on sales from securitizations	—			—			—			—			—
Securitization income, net	—			—			—			—			—
Total revenues	288			260			215			194			200
Interest expense:
Cardmember lending (A)	288			260			215			194			200
Charge card and other (B)	217			215			197			170			161
Revenues net of interest expense	(217		)	(215		)	(197		)	(170		)	(161		)
Expenses
Marketing, promotion, rewards and cardmember services	—			—			—			—			—
Human resources and other operating expenses (B)	(217		)	(215		)	(197		)	(170		)	(161		)
Provisions for losses	—			—			—			—			—
Total	(217		)	(215		)	(197		)	(170		)	(161		)
Pretax segment income	—			—			—			—			—
Income tax provision	—			—			—			—			—
Segment income	$	—		$	—		$	—		$	—		$	—

	Quarters Ended
	December 31,		September 30,		June 30,		March 31,		December 31,
	2006		2006		2006		2006		2005
Revised:
Revenues
Discount revenue, net card fees and other	$	2,679	$	2,482	$	2,514	$	2,314	$	2,401
Finance charge revenue	1,018		928		814		674		685
Less: Interest expense	—		—		—		—		—
Securitization income:
Excess spread, net (excluding servicing fees)	246		279		261		269		183
Servicing fees	101		100		100		106		105
Gains on sales from securitizations	—		5		11		11		7
Securitization income, net	347		384		372		386		295
Total revenues	4,044		3,794		3,700		3,374		3,381
Interest expense:
Cardmember lending	288		260		215		194		200
Charge card and other	217		215		197		170		161
Revenues net of interest expense	3,539		3,319		3,288		3,010		3,020
Expenses
Marketing, promotion, rewards and cardmember services	1,242		1,127		1,106		1,034		1,097
Human resources and other operating expenses	1,001		927		911		873		876
Provisions for losses	526		446		351		307		509
Total	2,769		2,500		2,368		2,214		2,482
Pretax segment income	770		819		920		796		538
Income tax provision	235		239		304		250		124
Segment income	$	535	$	580	$	616	$	546	$	414

(A) Gross cardmember lending finance charge interest expense will be presented in the line entitled “Cardmember lending” within the new “Interest expense” section. This amount was previously presented as “Interest expense” within “Cardmember lending net finance charge revenue.”

(B) Other interest expense will be presented in the line entitled “Charge card and other” within the new “Interest expense” section. This amount was previously reported in “Human resources and other operating expenses” within “Expenses.”

U.S. Card Services

Selected Income Staement Data

(unaudited)

(Millions)
	Quarters Ended						Years Ended
	September 30,		June 30,		March 31,		December 31,		December 31,
	2005		2005		2005		2006		2005
Historical, as reported:
Revenues
Discount revenue, net card fees and other	$	2,233	$	2,233	$	2,059	$	9,989	$	8,926
Finance charge revenue	614		587		522		3,434		2,408
Less: Interest expense	156		140		120		957		616
Securitization income:
Excess spread, net (excluding servicing fees)	227		192		209		1,055		811
Servicing fees	108		99		100		407		412
Gains on sales from securitizations	18		5		7		27		37
Securitization income, net	353		296		316		1,489		1,260
Total revenues	3,044		2,976		2,777		13,955		11,978
Interest expense:
Cardmember lending	—		—		—		—		—
Charge card and other	—		—		—		—		—
Revenues net of interest expense	3,044		2,976		2,777		13,955		11,978
Expenses
Marketing, promotion, rewards and cardmember services	1,003		974		837		4,509		3,911
Human resources and other operating expenses	950		938		895		4,511		3,820
Provisions for losses	458		367		342		1,630		1,676
Total	2,411		2,279		2,074		10,650		9,407
Pretax segment income	633		697		703		3,305		2,571
Income tax provision	190		220		221		1,028		755
Segment income	$	443	$	477	$	482	$	2,277	$	1,816

	Quarters Ended									Years Ended
	September 30,			June 30,			March 31,			December 31,			December 31,
	2005			2005			2005			2006			2005
Adjustments:
Revenues
Discount revenue, net card fees and other	$	—		$	—		$	—		$	—		$	—
Finance charge revenue	—			—			—			—			—
Less: Interest expense	(156		)	(140		)	(120		)	(957		)	(616		)
Securitization income:
Excess spread, net (excluding servicing fees)	—			—			—			—			—
Servicing fees	—			—			—			—			—
Gains on sales from securitizations	—			—			—			—			—
Securitization income, net	—			—			—			—			—
Total revenues	156			140			120			957			616
Interest expense:
Cardmember lending	156			140			120			957			616
Charge card and other	152			126			123			799			562
Revenues net of interest expense	(152		)	(126		)	(123		)	(799		)	(562		)
Expenses
Marketing, promotion, rewards and cardmember services	—			—			—			—			—
Human resources and other operating expenses	(152		)	(126		)	(123		)	(799		)	(562		)
Provisions for losses	—			—			—			—			—
Total	(152		)	(126		)	(123		)	(799		)	(562		)
Pretax segment income	—			—			—			—			—
Income tax provision	—			—			—			—			—
Segment income	$	—		$	—		$	—		$	—		$	—

	Quarters Ended						Years Ended
	September 30,		June 30,		March 31,		December 31,		December 31,
	2005		2005		2005		2006		2005
Revised:
Revenues
Discount revenue, net card fees and other	$	2,233	$	2,233	$	2,059	$	9,989	$	8,926
Finance charge revenue	614		587		522		3,434		2,408
Less: Interest expense	—		—		—		—		—
Securitization income:
Excess spread, net (excluding servicing fees)	227		192		209		1,055		811
Servicing fees	108		99		100		407		412
Gains on sales from securitizations	18		5		7		27		37
Securitization income, net	353		296		316		1,489		1,260
Total revenues	3,200		3,116		2,897		14,912		12,594
Interest expense:
Cardmember lending	156		140		120		957		616
Charge card and other	152		126		123		799		562
Revenues net of interest expense	2,892		2,850		2,654		13,156		11,416
Expenses
Marketing, promotion, rewards and cardmember services	1,003		974		837		4,509		3,911
Human resources and other operating expenses	798		812		772		3,712		3,258
Provisions for losses	458		367		342		1,630		1,676
Total	2,259		2,153		1,951		9,851		8,845
Pretax segment income	633		697		703		3,305		2,571
Income tax provision	190		220		221		1,028		755
Segment income	$	443	$	477	$	482	$	2,277	$	1,816

U.S. Card Services

Selected Financial Information

Managed Basis Presentation (A)

(unaudited)

(Millions)
	Quarters Ended
	December 31,		September 30,		June 30,		March 31,		December 31,
	2006		2006		2006		2006		2005
Historical, as reported:
Net finance charge revenue
Reported for the period (GAAP)	$	730	$	668	$	599	$	480	$	485
Securitization adjustments	450		475		469		486		518
Managed net finance charge revenue	$	1,180	$	1,143	$	1,068	$	966	$	1,003

	Quarters Ended
	December 31,		September 30,		June 30,		March 31,		December 31,
	2006		2006		2006		2006		2005
Revised:
Finance charge revenue
Reported for the period (GAAP)	$	1,018	$	928	$	814	$	674	$	685
Securitization adjustments	729		749		726		733		744
Managed finance charge revenue	$	1,747	$	1,677	$	1,540	$	1,407	$	1,429

Cardmember lending interest expense
Reported for the period (GAAP)	$	288	$	260	$	215	$	194	$	200
Securitization adjustments	279		274		257		247		226
Managed cardmember lending interest expense	$	567	$	534	$	472	$	441	$	426

	Quarters Ended						Years Ended
	September 30,		June 30,		March 31,		December 31,		December 31,
	2005		2005		2005		2006		2005
Historical, as reported:
Net finance charge revenue
Reported for the period (GAAP)	$	458	$	447	$	402	$	2,477	$	1,792
Securitization adjustments	512		454		469		1,880		1,953
Managed net finance charge revenue	$	970	$	901	$	871	$	4,357	$	3,745

	Quarters Ended						Years Ended
	September 30,		June 30,		March 31,		December 31,		December 31,
	2005		2005		2005		2006		2005
Revised:
Finance charge revenue
Reported for the period (GAAP)	$	614	$	587	$	522	$	3,434	$	2,408
Securitization adjustments	721		618		609		2,937		2,692
Managed finance charge revenue	$	1,335	$	1,205	$	1,131	$	6,371	$	5,100

Cardmember lending interest expense
Reported for the period (GAAP)	$	156	$	140	$	120	$	957	$	616
Securitization adjustments	209		164		140		1,057		739
Managed cardmember lending interest expense	$	365	$	304	$	260	$	2,014	$	1,355

(A) The managed basis presentation includes on-balance sheet cardmember loans and off-balance sheet securitized cardmember loans. The difference between the “owned basis” (GAAP) information and “managed basis” information is attributable to the effects of securitization activities. For more information about this difference, see also “Differences between GAAP and Managed Basis Presentation” on page 55 in the Company’s 2006 Annual Report, which is filed with the SEC as Exhibit 13 to the Company’s 2006 Form 10-K Report.

U.S. Card Services

Selected Statistical Information

(unaudited)

	Quarters Ended
	December 31,		September 30,		June 30,		March 31,		December 31,
	2006		2006		2006		2006		2005
Historical, as reported:
Cardmember receivables:
90 days past due as a % of total	2.1	%	2.3	%	2.3	%	2.3	%	1.8	%

	Quarters Ended
	December 31,		September 30,		June 30,		March 31,		December 31,
	2006		2006		2006		2006		2005
Revised:
Cardmember receivables:
90 days past due as a % of total	3.3	%	3.5	%	3.4	%	4.0	%	3.4	%

	Quarters Ended						Years Ended
	September 30,		June 30,		March 31,		December 31,		December 31,
	2005		2005		2005		2006		2005
Historical, as reported:
Cardmember receivables:
90 days past due as a % of total	2.0	%	2.0	%	2.3	%	2.1	%	1.8	%

	Quarters Ended						Years Ended
	September 30,		June 30,		March 31,		December 31,		December 31,
	2005		2005		2005		2006		2005
Revised:
Cardmember receivables:
90 days past due as a % of total	3.5	%	3.1	%	3.5	%	3.3	%	3.4	%

The Company will revise the method of reporting certain credit statistics related to the charge card business to better align these metrics with the way the Company manages credit risk as well as to align such credit statistics with the method used for reporting the Company’s lending activities. Historically, the credit statistics for the charge card business have been presented using the portion of the account balance that was 90 days past due or more. However, the Company’s practices for managing credit risk and establishing reserves for uncollectible amounts consider the entire amounts of customer accounts for those accounts which have any portion that is past due by 90 days or more. The Company has determined that the disclosure of credit statistics for the charge card business in a manner consistent with the internal methodology used for reserving practices is preferable. Because the Company’s existing risk management assessments already utilize this methodology, the level of reserves has not been changed. The new statistics do not indicate a change in management’s view of the Company’s underlying credit quality, risk profile or adequacy of reserves. Revised historical statistics using this new reporting method are presented above.

International Card & Global Commercial Services

Selected Income Statement Data

(unaudited)

(Millions)
	Quarters Ended
	December 31,		September 30,		June 30,		March 31,		December 31,
	2006		2006		2006		2006		2005
Historical, as reported:
Revenues
Discount revenue, net card fees and other	$	2,220	$	2,086	$	2,241	$	2,109	$	2,115
Finance charge revenue	329		310		308		293		278
Less: Interest expense	116		109		108		99		94
Total revenues	2,433		2,287		2,441		2,303		2,299
Interest expense:
Cardmember lending	—		—		—		—		—
International banking, charge card and other	—		—		—		—		—
Revenues net of interest expense	2,433		2,287		2,441		2,303		2,299
Expenses
Marketing, promotion, rewards and cardmember services	346		330		410		343		321
Human resources and other operating expenses	1,509		1,347		1,373		1,300		1,402
Provisions for losses and benefits	316		329		364		349		286
Total	2,171		2,006		2,147		1,992		2,009
Pretax segment income	262		281		294		311		290
Income tax provision	31		65		69		98		57
Segment income	$	231	$	216	$	225	$	213	$	233

	Quarters Ended
	December 31,			September 30,			June 30,			March 31,			December 31,
	2006			2006			2006			2006			2005
Adjustments:
Revenues
Discount revenue, net card fees and other (A)	$	155		$	139		$	120		$	113		$	114
Finance charge revenue	(25		)	(24		)	(23		)	(22		)	(21		)
Less: Interest expense (B)	(116		)	(109		)	(108		)	(99		)	(94		)
Total revenues	246			224			205			190			187
Interest expense:
Cardmember lending (B)	105			99			99			90			86
International banking, charge card and other (A) (C)	287			256			227			202			204
Revenues net of interest expense	(146		)	(131		)	(121		)	(102		)	(103		)
Expenses
Marketing, promotion, rewards and cardmember services	—			—			—			—			—
Human resources and other operating expenses (C)	(146		)	(131		)	(121		)	(102		)	(103		)
Provisions for losses and benefits	—			—			—			—			—
Total	(146		)	(131		)	(121		)	(102		)	(103		)
Pretax segment income	—			—			—			—			—
Income tax provision	—			—			—			—			—
Segment income	$	—		$	—		$	—		$	—		$	—

	Quarters Ended
	December 31,		September 30,		June 30,		March 31,		December 31,
	2006		2006		2006		2006		2005
Revised:
Revenues
Discount revenue, net card fees and other	$	2,375	$	2,225	$	2,361	$	2,222	$	2,229
Finance charge revenue	304		286		285		271		257
Less: Interest expense	—		—		—		—		—
Total revenues	2,679		2,511		2,646		2,493		2,486
Interest expense:
Cardmember lending	105		99		99		90		86
International banking, charge card and other	287		256		227		202		204
Revenues net of interest expense	2,287		2,156		2,320		2,201		2,196
Expenses
Marketing, promotion, rewards and cardmember services	346		330		410		343		321
Human resources and other operating expenses	1,363		1,216		1,252		1,198		1,299
Provisions for losses and benefits	316		329		364		349		286
Total	2,025		1,875		2,026		1,890		1,906
Pretax segment income	262		281		294		311		290
Income tax provision	31		65		69		98		57
Segment income	$	231	$	216	$	225	$	213	$	233

(A) Primarily reflects international banking interest expense that will be presented as “International banking, charge card and other” within the new “Interest expense” section. This amount was previously presented as a reduction of “Discount revenue, net card fees and other.”

(B) Gross cardmember lending finance charge interest expense will be presented in the line entitled “Cardmember lending” within the new “Interest expense” section. This amount was previously presented as “Interest expense” within “Cardmember lending net finance charge revenue.”

(C) Other interest expense will be presented in the line entitled “International banking, charge card and other” within the new “Interest expense” section. This amount was previously reported in “Human resources and other operating expenses” within “Expenses.”

International Card & Global Commercial Services

Selected Income Statement Data

(unaudited)

(Millions)
	Quarters Ended						Years Ended
	September 30,		June 30,		March 31,		December 31,		December 31,
	2005		2005		2005		2006		2005
Historical, as reported:
Revenues
Discount revenue, net card fees and other	$	2,041	$	2,083	$	1,982	$	8,656	$	8,221
Finance charge revenue	259		251		247		1,240		1,035
Less: Interest expense	88		86		83		432		351
Total revenues	2,212		2,248		2,146		9,464		8,905
Interest expense:
Cardmember lending	—		—		—		—		—
International banking, charge card and other	—		—		—		—		—
Revenues net of interest expense	2,212		2,248		2,146		9,464		8,905
Expenses
Marketing, promotion, rewards and cardmember services	310		328		310		1,429		1,269
Human resources and other operating expenses	1,315		1,437		1,366		5,529		5,520
Provisions for losses and benefits	270		239		228		1,358		1,023
Total	1,895		2,004		1,904		8,316		7,812
Pretax segment income	317		244		242		1,148		1,093
Income tax provision	68		19		50		263		194
Segment income	$	249	$	225	$	192	$	885	$	899

	Quarters Ended									Years Ended
	September 30,			June 30,			March 31,			December 31,			December 31,
	2005			2005			2005			2006			2005
Adjustments:
Revenues
Discount revenue, net card fees and other	$	97		$	94		$	86		$	527		$	391
Finance charge revenue	(14		)	(17		)	(16		)	(94		)	(68		)
Less: Interest expense	(88		)	(86		)	(83		)	(432		)	(351		)
Total revenues	171			163			153			865			674
Interest expense:
Cardmember lending	81			79			77			393			323
International banking, charge card and other	197			177			162			972			740
Revenues net of interest expense	(107		)	(93		)	(86		)	(500		)	(389		)
Expenses
Marketing, promotion, rewards and cardmember services	—			—			—			—			—
Human resources and other operating expenses	(107		)	(93		)	(86		)	(500		)	(389		)
Provisions for losses and benefits	—			—			—			—			—
Total	(107		)	(93		)	(86		)	(500		)	(389		)
Pretax segment income	—			—			—			—			—
Income tax provision	—			—			—			—			—
Segment income	$	—		$	—		$	—		$	—		$	—

	Quarters Ended						Years Ended
	September 30,		June 30,		March 31,		December 31,		December 31,
	2005		2005		2005		2006		2005
Revised:
Revenues
Discount revenue, net card fees and other	$	2,138	$	2,177	$	2,068	$	9,183	$	8,612
Finance charge revenue	245		234		231		1,146		967
Less: Interest expense	—		—		—		—		—
Total revenues	2,383		2,411		2,299		10,329		9,579
Interest expense:
Cardmember lending	81		79		77		393		323
International banking, charge card and other	197		177		162		972		740
Revenues net of interest expense	2,105		2,155		2,060		8,964		8,516
Expenses
Marketing, promotion, rewards and cardmember services	310		328		310		1,429		1,269
Human resources and other operating expenses	1,208		1,344		1,280		5,029		5,131
Provisions for losses and benefits	270		239		228		1,358		1,023
Total	1,788		1,911		1,818		7,816		7,423
Pretax segment income	317		244		242		1,148		1,093
Income tax provision	68		19		50		263		194
Segment income	$	249	$	225	$	192	$	885	$	899

International Card & Global Commercial Services

Selected Statistical Information

(unaudited)

	Quarters Ended
	December 31,		September 30,		June 30,		March 31,		December 31,
	2006		2006		2006		2006		2005
Historical, as reported:
Cardmember receivables:
90 days past due as a % of total (A)	1.4	%	1.3	%	1.3	%	1.3	%	1.3	%

Net finance charge revenue (B)/average loans (C)	9.1	%	8.9	%	9.1	%	9.4	%	9.4	%

	Quarters Ended
	December 31,		September 30,		June 30,		March 31,		December 31,
	2006		2006		2006		2006		2005
Revised:
Cardmember receivables:
90 days past due as a % of total (A)	2.1	%	2.0	%	2.1	%	2.0	%	2.1	%

Net finance charge revenue (B)/average loans (C)	8.5	%	8.3	%	8.5	%	8.7	%	8.7	%

	Quarters Ended						Years Ended
	September 30,		June 30,		March 31,		December 31,		December 31,
	2005		2005		2005		2006		2005
Historical, as reported:
Cardmember receivables:
90 days past due as a % of total (A)	1.2	%	1.3	%	1.4	%	1.4	%	1.3	%

Net finance charge revenue (B)/average loans (C)	9.3	%	9.3	%	9.2	%	9.1	%	9.3	%

	Quarters Ended						Years Ended
	September 30,		June 30,		March 31,		December 31,		December 31,
	2005		2005		2005		2006		2005
Revised:
Cardmember receivables:
90 days past due as a % of total (A)	1.9	%	1.9	%	1.9	%	2.1	%	2.1	%

Net finance charge revenue (B)/average loans (C)	8.9	%	8.7	%	8.7	%	8.5	%	8.8	%

(A)The Company will revise the method of reporting certain credit statistics related to the charge card business to better align these metrics with the way the Company manages credit risk as well as to align such credit statistics with the method used for reporting the Company’s lending activities. Historically, the credit statistics for the charge card business have been presented using the portion of the account balance that was 90 days past due or more. However, the Company’s practices for managing credit risk and establishing reserves for uncollectible amounts consider the entire amounts of customer accounts for those accounts which have any portion that is past due by 90 days or more. The Company has determined that the disclosure of credit statistics for the charge card business in a manner consistent with the internal methodology used for reserving practices is preferable. Because the Company’s existing risk management assessments already utilize this methodology, the level of reserves has not been changed. The new statistics do not indicate a change in management’s view of the Company’s underlying credit quality, risk profile or adequacy of reserves. Revised historical statistics using this new reporting method are presented above.

(B) Computed on an annualized basis.

(C) The calculation of net finance charge revenue divided by average loans has been corrected for a computational error. This correction has a minimal impact on the historic trends for this statistical information.

Global Network & Merchant Services

Selected Income Statement Data

(unaudited)

(Millions)
	Quarters Ended
	December 31,		September 30,		June 30,		March 31,		December 31,
	2006		2006		2006		2006		2005
Historical, as reported:
Revenues
Discount revenue, fees and other	$	869	$	798	$	789	$	705	$	725
Interest expense:
Cardmember lending	—		—		—		—		—
Other	—		—		—		—		—
Revenues net of interest expense	869		798		789		705		725
Expenses
Marketing and promotion	125		118		140		135		141
Human resources and other operating expenses	401		347		320		298		319
Provisions for losses	46		19		14		10		13
Total	572		484		474		443		473
Pretax segment income	297		314		315		262		252
Income tax provision	96		102		115		96		86
Segment income	$	201	$	212	$	200	$	166	$	166

	Quarters Ended
	December 31,			September 30,			June 30,			March 31,			December 31,
	2006			2006			2006			2006			2005
Adjustments:
Revenues
Discount revenue, fees and other (A)	$	(29	)	$	(25	)	$	(24	)	$	(20	)	$	(21	)
Interest expense:
Cardmember lending (A)	(29		)	(25		)	(24		)	(20		)	(21		)
Other (A)	(47		)	(43		)	(50		)	(43		)	(43		)
Revenues net of interest expense	47			43			50			43			43
Expenses
Marketing and promotion	—			—			—			—			—
Human resources and other operating expenses (A)	47			43			50			43			43
Provisions for losses	—			—			—			—			—
Total	47			43			50			43			43
Pretax segment income	—			—			—			—			—
Income tax provision	—			—			—			—			—
Segment income	$	—		$	—		$	—		$	—		$	—

	Quarters Ended
	December 31,			September 30,			June 30,			March 31,			December 31,
	2006			2006			2006			2006			2005
Revised:
Revenues
Discount revenue, fees and other	$	840		$	773		$	765		$	685		$	704
Interest expense:
Cardmember lending	(29		)	(25		)	(24		)	(20		)	(21		)
Other	(47		)	(43		)	(50		)	(43		)	(43		)
Revenues net of interest expense	916			841			839			748			768
Expenses
Marketing and promotion	125			118			140			135			141
Human resources and other operating expenses	448			390			370			341			362
Provisions for losses	46			19			14			10			13
Total	619			527			524			486			516
Pretax segment income	297			314			315			262			252
Income tax provision	96			102			115			96			86
Segment income	$	201		$	212		$	200		$	166		$	166

(A) The interest expense credit represents the reduced funding costs associated with the non-interest bearing accounts payable due to merchants.

Global Network & Merchant Services

Selected Income Statement Data

(unaudited)

(Millions)
	Quarters Ended						Years Ended
	September 30,		June 30,		March 31,		December 31,		December 31,
	2005		2005		2005		2006		2005
Historical, as reported:
Revenues
Discount revenue, fees and other	$	693	$	691	$	638	$	3,161	$	2,747
Interest expense:
Cardmember lending	—		—		—		—		—
Other	—		—		—		—		—
Revenues net of interest expense	693		691		638		3,161		2,747
Expenses
Marketing and promotion	167		131		165		518		604
Human resources and other operating expenses	293		298		285		1,366		1,195
Provisions for losses	19		17		17		89		66
Total	479		446		467		1,973		1,865
Pretax segment income	214		245		171		1,188		882
Income tax provision	73		90		60		409		309
Segment income	$	141	$	155	$	111	$	779	$	573

	Quarters Ended									Years Ended
	September 30,			June 30,			March 31,			December 31,			December 31,
	2005			2005			2005			2006			2005
Adjustments:
Revenues
Discount revenue, fees and other	$	(17	)	$	(16	)	$	(12	)	$	(98	)	$	(66	)
Interest expense:
Cardmember lending	(17		)	(16		)	(12		)	(98		)	(66		)
Other	(35		)	(36		)	(31		)	(183		)	(145		)
Revenues net of interest expense	35			36			31			183			145
Expenses
Marketing and promotion	—			—			—			—			—
Human resources and other operating expenses	35			36			31			183			145
Provisions for losses	—			—			—			—			—
Total	35			36			31			183			145
Pretax segment income	—			—			—			—			—
Income tax provision	—			—			—			—			—
Segment income	$	—		$	—		$	—		$	—		$	—

	Quarters Ended									Years Ended
	September 30,			June 30,			March 31,			December 31,			December 31,
	2005			2005			2005			2006			2005
Revised:
Revenues
Discount revenue, fees and other	$	676		$	675		$	626		$	3,063		$	2,681
Interest expense:
Cardmember lending	(17		)	(16		)	(12		)	(98		)	(66		)
Other	(35		)	(36		)	(31		)	(183		)	(145		)
Revenues net of interest expense	728			727			669			3,344			2,892
Expenses
Marketing and promotion	167			131			165			518			604
Human resources and other operating expenses	328			334			316			1,549			1,340
Provisions for losses	19			17			17			89			66
Total	514			482			498			2,156			2,010
Pretax segment income	214			245			171			1,188			882
Income tax provision	73			90			60			409			309
Segment income	$	141		$	155		$	111		$	779		$	573

American Express Company

Computation in Support of Ratio of Earnings to Fixed Charges

(unaudited)

(Millions)
	Years Ended December 31,
	2006		2005		2004		2003
Historical, as reported:
Earnings:
Pretax income from continuing operations	$	5,328	$	4,248	$	3,831	$	3,415
Interest expense	2,880		2,168		1,659		1,606
Other adjustments	139		150		151		154
Total earnings (a)	$	8,347	$	6,566	$	5,641	$	5,175
Fixed charges:
Interest expense	$	2,880	$	2,168	$	1,659	$	1,606
Other adjustments	106		151		145		139
Total fixed charges (b)	$	2,986	$	2,319	$	1,804	$	1,745

Ratio of earnings to fixed charges (a/b)	2.80		2.83		3.13		2.97

Adjustments:
Earnings:
Pretax income from continuing operations	$	—	$	—	$	—	$	—
Interest expense	252		156		171		122
Other adjustments	—		—		—		—
Total earnings	$	252	$	156	$	171	$	122
Fixed charges:
Interest expense	$	252	$	156	$	171	$	122
Other adjustments	—		—		—		—
Total fixed charges	$	252	$	156	$	171	$	122

Revised:
Earnings:
Pretax income from continuing operations	$	5,328	$	4,248	$	3,831	$	3,415
Interest expense	3,132		2,324		1,830		1,728
Other adjustments	139		150		151		154
Total earnings (a)	$	8,599	$	6,722	$	5,812	$	5,297
Fixed charges:
Interest expense	$	3,132	$	2,324	$	1,830	$	1,728
Other adjustments	106		151		145		139
Total fixed charges (b)	$	3,238	$	2,475	$	1,975	$	1,867

Ratio of earnings to fixed charges (a/b)	2.66		2.72		2.94		2.84

Included in interest expense in the above computation is interest expense related to cardmember lending activities, international banking operations, and charge card and other activities in the Consolidated Statements of Income.

For purposes of the “earnings” computation, “other adjustments” include adding the amortization of capitalized interest, the net loss of affiliates accounted for under the equity method whose debt is not guaranteed by the Company, the minority interest in the earnings of majority-owned subsidiaries with fixed charges, and the interest component of rental expense and subtracting undistributed net income of affiliates accounted for under the equity method.

For purposes of the “fixed charges” computation, “other adjustments” include capitalized interest costs and the interest component of rental expense.