American Express Company · NYSE:AXP
American Express — Investor Day (March 2019)
182 slides from American Express's investor day presentation, Mar 13, 2019
Slide 1: American Express Company 2019 Investor Day
American Express Company 2019 Investor Day March 13, 2019
Slide 2: Agenda
Agenda CEO Update Steve Squeri 2 Commercial Global Commercial and B2BServices Expansion Anna Marrs 2 Digital Mohammed Badi Financial Outlook Jeff Campbell Q&A 2
Slide 3: Key Themes
Key Themes We have strong momentum in our core business and a foundation for growth We will accelerate progress against our strategic imperatives by: ‒ Focusing on our customers as a platform for growth ‒ Expanding strategic partnerships ‒ Focusing our international strategy Today, we’re going
Slide 4: CEO Update
CEO Update 2018 was a strong year, driven by our four strategic imperatives We have a strong foundation and momentum to sustain growth We will accelerate progress against our strategic imperatives through three enterprise-wide initiatives 4
Slide 5: We had strong performance in 2018
We had strong performance in 2018… 2018 Key Accomplishments 10% 24% 34% Fx Adjusted Adjusted EPS Growth Return on Equity Revenue Growth 11% 13% 19% Fx Adjusted Proprietary Total Loans Growth New Cards Billed Business Growth Acquired Growth See Annex A for an explanation of Fx-adjusted information. A
Slide 6: Momentum across all lines of business
…as a result of momentum across all lines of business… of new 49% accounts are Millennials of new #1 Best Credit 64% Scaled accounts are on Card App in Consumer fee products Pay It Plan It Customer Satisfaction* Enhanced Expanded Grew share premium value Consumer and in 7 of 8 top proposition Commer
Slide 7: Our four strategic imperatives
…which was anchored in our four strategic imperatives: Build on our Expand leadership strong position in the premium in commercial consumer space payments Make Strengthen our American Express global, integrated an essential part network to provide of our customers’ unique value digital lives 7
Slide 8: Investment strategy: share, scale, relevance
This performance is a result of our investment strategy… SHARE SCALE RELEVANCE 8
Slide 9: Continued structural evolution
… and supported by our continued structural evolution… Globalized core lines of businesses Enterprise partner management Centers of excellence shared globally Technology platforms that service the enterprise Enterprise-wide brand platform 9
Slide 10: Talented leaders, both tenured and new
…led by our talented leaders, both tenured and new Amex Amex Amex Amex Amex Amex Tenure: Tenure: Tenure: Tenure: Tenure: Tenure: 32Y 31Y 29Y 28Y 26Y 9Y Doug Mike Elizabeth Anré Denise Eduardo Buckminster O’Neill Rutledge Williams Pickett Ramos Group President, Chief Corporate Chief Marketing Group P
Slide 11: We are also operating differently
We are also operating differently From… To… Game Plan: Repositioning Path Forward: Growth Business Unit-Centric Enterprise Approach Approach Independent Country Plans Integrated Country Plans Card Focused Membership Focused Travel Services Lifestyle Services 11
Slide 12: CEO Update
CEO Update 2018 was a strong year, driven by our four strategic imperatives We have a strong foundation and momentum to sustain growth We will accelerate progress against our strategic imperatives through three enterprise-wide initiatives 12
Slide 13: Differentiated business model creates a strong foundation for growth
Our differentiated business model has created a strong foundation for growth… Diverse End-to-End, Revenue Customer Integrated Payments Platform Mix Base Global Operating Footprint Leverage Card Members Merchants World Class Brand & Service 13
Slide 14: End-to-end, integrated payments platform
… and our end-to-end, integrated payments platform creates differentiated value Issuer Network Merchant Acquirer Relationships Economics Data 14
Slide 15: Changing payments landscape opportunities
The rapidly changing payments landscape features an array of attractive opportunities Global Payments Industry Opportunity Secular shift Digitization 17% from cash & Projected global digital commerce growth checks through 2021* Automation 10% Projected consumer Growth in spend growth through 2022**
Slide 16: Financial Growth Algorithm
Financial Growth Algorithm We are focused on sustaining high levels of Revenue growth that deliver steady and consistent double-digit EPS growth 16
Slide 17: Results and guidance in line with revenue growth focus
Our results and guidance are in line with our focus on high revenue growth and double digit earnings growth Investment 2018 Actuals 2019 Guidance Strategy Share 10% 8-10% Revenue Growth Revenue Growth (Fx adjusted*) Scale Relevance 13% $7.85-$8.35 Adj. EPS Growth** EPS The 2019 adjusted EPS gu
Slide 18: CEO Update
CEO Update 2018 was a strong year, driven by our four strategic imperatives We have a strong foundation and momentum to sustain growth We will accelerate progress against our strategic imperatives through three enterprise-wide initiatives 18
Slide 19: Three enterprise-wide initiatives
Going forward, we will accelerate progress against our strategic imperatives through three enterprise-wide initiatives Focusing on the customer as Build on our 1 a platform for growth Expand leadership strong position in the premium in commercial consumer space Expanding strategic 2 payments partner
Slide 20: Customers as a platform for growth
1 We have an opportunity to focus on our customers as a platform for growth We have an attractive, high-spending …and there is an opportunity to customer base… further deepen our relationships 110M+ 3x 40-45% ~20% Card Members avg. annual spend, of Consumer Card of Consumer Card worldwide Amex Card
Slide 21: Expanding relationships with existing customers
1 We’ve already made strides expanding our relationships with existing customers Consumer Commercial Key Enablers 1M+ Upgrades and cross-sells to US customers in 2018 Upgrades and cross-sells driving incremental revenue Enhanced targeting 30% 43% Personalized Spend growth when a Spend growth whe
Slide 22: Redefining core membership on a single platform
1 And we are redefining our core membership by consolidating existing services into a single platform Customer experience evolution Charge Cobrand Lend “Card-focused” “Member-focused” Membership based on features Integrated platform of payments, of the product or category lifestyle and financial
Slide 23: Activating existing customers as acquisition channel
1 We are activating existing customers as an acquisition channel Member Get Member Amex can mobilize a loyal member base to attract new members Billings acquired from referral programs* 2nd largest acquisition channel globally 6x 33% of MGM referrals successfully referred another new account in 2018
Slide 24: Integrated model drives value across the ecosystem
1 Our integrated model enables participants in the ecosystem to drive value to one another Connecting Merchants with Opportunities for Expansion within Consumers and Businesses the Network Amex offers rich value to Beyond existing relationships in the Card Members enabled in model, we will pursue op
Slide 25: Key Takeaways: Customer as a platform for growth
Key Takeaways: 1 Focusing on the customer as a platform for growth Our existing customer base is a highly valuable asset We are redefining our core membership philosophy Our ability to connect participants and provide value through our integrated model is an opportunity to accelerate growth 25
Slide 26: Strategic partnerships drive growth
2 Our strategic partnerships drive growth, provide access to capabilities and increase coverage Cobrand Digital Capability Coverage Partnerships Partnerships Partnerships Partnerships OptBlue 50+ Globally Cobrands Digital Wallets P2P AP Automation Virtual Payments 19 Acquirers in the U.S.
Slide 27: Cobrand partnerships are deep and mutually beneficial
2 Our cobrand partnerships are deep, enterprise-wide and mutually beneficial Benefits for Cobrand Partners Benefits for Amex #1 #1 Ability to reach customers in Financial Global Leading Services Business Consumer their preferred channels Brand* Travel Travel Agency** Business Access to partner rewar
Slide 28: Cobrand portfolio is large and growing
2 Our cobrand portfolio is large and growing 20+ airlines globally 2 of the largest hotel companies in the world 19 Commercial cobrand partners globally 28
Slide 29: New and expanded cobrand partnerships
2 A few examples of new and expanded cobrand partnerships 29
Slide 30: American Express and Delta relationship
2 American Express and Delta have a strong, strategic relationship built on our unique assets Merchant Benefits of Partnership Corporate Card Gift Cards and Purchasing Card 1M+ accounts acquired Jet Fuel Accertify per year in 2017 and 2018 Financing Anti-Fraud Consumer and Integration of Members
Slide 31: Digital partnerships
2 Digital partnerships expand how we embed ourselves into our customers’ digital lives Apple Seamless access to Unlock $8B MR points Access the global Card Member bank to millions of SME customer base base merchants and automate capabilities 31
Slide 32: Capability partnerships accelerate B2B products
2 Capability partnerships further accelerate new B2B products and services, and embed lifestyle tools B2B Products & Services Lifestyle Tools Automate accounts payable Provide merchants Embed lifestyle tools and and streamline business the ability to offer capabilities into Amex’s supplier payments
Slide 33: Coverage partnerships scale worldwide footprint
2 Coverage partnerships scale our worldwide footprint to drive further growth Merchant Coverage Partnerships Bank Partnerships 76 Banks acquire for AXP globally 33
Slide 34: Key Takeaways: Expanding strategic partnerships
Key Takeaways: 2 Expanding strategic partnerships to drive growth Mutually beneficial strategic partnerships are core to our business and we are expanding their use to drive growth We are utilizing our unique assets to further deepen and expand our partner network Our partnerships span across
Slide 35: Strong international momentum
3 We have strong momentum internationally, which positions us well for future growth 2018 Annual Growth 17% International Consumer FX Adj. Billed Business 23% 170+ Merchant Acceptance Countries and Territories with International SME FX Adj. Billed Business 100+ Issuing Presence Countries and Territo
Slide 36: Focusing our international approach
3 We are focusing our approach internationally to continue our momentum and sustain growth Examples Tier 1 Enterprise-wide 66% Strategic investments in top 10 countries to accelerate growth Of International Focus across all lines of business Billings UK Tier 2 9% Targeted investments in countries th
Slide 37: Expanding international coverage
3 Coverage is key and we are applying learnings from the U.S. to expand internationally Tier 1 Countries Top Cities Targeted Industries 20-25% 20-25% 15-20% We plan to increase international coverage by approximately 20% over the next three years 37
Slide 38: The Caribbean example
3 The Caribbean is an example of refocusing on enterprise needs versus local needs 5x Increase in merchants acquired in 2018 (vs. 2016) 46% Increase in 85 Of Caribbean spend from % inbound travellers locations-in-force 38
Slide 39: Entering China as a network
3 Entering China as a network will enable us to expand our footprint to one of the largest markets #1 World’s largest payments market and growing rapidly $14T 2018 payments volume* 35% growth, 2017-2018* Large growth potential Apr 2018 Nov 2018 over the long-term Apply for network license First fore
Slide 40: Key Takeaways: International strategy
Key Takeaways: 3 Focusing our international strategy Amex has demonstrated strong momentum and growth in international – outpacing the company’s performance Our focused investment approach supported by our integrated model can power continued share-taking growth levels Increases in coverage in
Slide 41: Closing Thoughts
Closing Thoughts 2018 was a strong year, driven by our four strategic imperatives We have a strong foundation and momentum to sustain growth We will accelerate progress against our strategic imperatives through three enterprise-wide initiatives 41
Slide 42: Agenda
Agenda CEO Update Steve Squeri 2 Commercial Global Commercial and B2BServices Expansion Anna Marrs Global Commercial Services 2 Digital Mohammed Badi Financial Outlook Jeff Campbell Q&A 42
Slide 43: Commercial and B2B Overview
Commercial and B2B Overview American Express is a leader in commercial payments today, delivering strong financial results on our spend-centric model Multiple industry trends will enable us to leverage our existing assets to both grow with the market and gain share We are investing to grow profitabl
Slide 44: Commercial and B2B Agenda
Commercial and B2B Agenda Commercial and B2B Today Opportunity and Growth Potential Growth Priorities Conclusion 44
Slide 45: Leader in Commercial Payments
We are the leader in Commercial Payments and serve customers across the globe Small & Medium Global & Large Enterprises Accounts Key Needs Easy-to-use services & tools Consistent global solutions Cash flow management Integrated payment tools Access to working capital Value-added insights
Slide 46: Suite of card, payment and working capital solutions
We deliver a suite of card, payment and working capital solutions to meet our customer’s needs Small & Medium Global & Large Enterprises Accounts Card Products Small Business Cards Corporate Card and T&E Solutions Lending Cards Purchasing Solutions Global Currency Solutions Working Capital
Slide 47: Continued growth in billed business and revenue
We have demonstrated continued growth in billed business and revenue 2018 2018 ($B) Fx-adj. Growth Billed Business $486 11% US SME $304 10% Int’l SME $58 23% Global & Large $124 8% Total Loans* $14 14% Revenue* $13 8% * Revenues net of interest expense and Total loans each adjusted for Fx are
Slide 48: Spend-centric revenue economics
Our revenue economics are spend-centric relative to overall AXP 2018 Revenue Mix 6% 19% Net Interest Income Spend & Fee 94% Revenue 81% Total AXP Global Commercial Services 48
Slide 49: Commercial and B2B Agenda
Commercial and B2B Agenda Commercial and B2B Today Opportunity and Growth Potential Growth Priorities Conclusion 49
Slide 50: B2B Payments and Working Capital opportunity
The B2B Payments and Working Capital opportunity Definition Categories included Any payment by a Domestic Supplier Payments business to another Cross-Border Supplier business Payments B2B T&E B2B Payments Payments and Working Short-term All forms of Working Capital (e.g., Capital borrowi
Slide 51: Estimated $90B profit pool
The B2B Payments and Working Capital opportunity makes up an estimated $90B profit pool $B Profit pool Small & Medium Enterprises* Global and Large Domestic Supplier $27 $14 Payments Cross-Border $13 $7 Supplier Payments B2B B2B Payments Payments T&E $3 $3 and Working Working Capital** $12 $7 Capita
Slide 52: Evolving landscape and shifting customer preferences
Evolving landscape and shifting customer preferences create new opportunities Industry Trends Future Environment Digital & Streamlined payments & reconciliation via AP Technology Automation software & Data Data & AI Insights to drive compliance and savings Personalization Consumer-like experiences,
Slide 53: Strong foundation with untapped growth opportunity
We have a strong foundation across customer segments with untapped growth opportunity Global & US SME Int’l SME Large #1 US Small Business 25% Average YoY Fx-adj. billings 63% of 2018 FORTUNE Global 500® Card Issuer1 growth in top 5 countries2 Companies are AXP customers3 33% actively using <5% aggr
Slide 54: Driving growth in more profit pools
Capitalizing on industry growth, external trends & AXP assets, we can drive growth in more profit pools Established Areas Future Focus SMEs G&L SMEs G&L Domestic Supplier Payments Cross-Border Supplier Payments B2B B2B Payments Payments T&E and Working Capital Working Capital Worki
Slide 55: Assets position us for future growth
The assets that make us successful also position us for future growth Distribution & Product Breadth Client Management Vendor Pay … global distribution and Integrated … card leader, with growing B2B servicing reach across digital, tele and face-to-face channels Model payment and working capital capa
Slide 56: Commercial and B2B Agenda
Commercial and B2B Agenda Commercial and B2B Today Opportunity and Growth Potential Growth Priorities Conclusion 56
Slide 57: Mission: Be essential to our customer's business every day
Mission: Be essential to our customer’s business every day 57
Slide 58: Three strategic priorities across customer segments
We are focused on three strategic priorities across our customer segments Global & US SME Int’l SME Large Differentiate and grow core card business Scale working capital and supplier payment solutions Digitize the customer experience 58
Slide 59: US Small & Medium Enterprises
US Small & Medium Enterprises Global & US SME Int’l SME Large Differentiate and grow core card business Scale working capital and supplier payment solutions Digitize the customer experience 59
Slide 60: Proprietary business cards provide differentiated value
Our proprietary business cards provide differentiated value NEW Business Gold Business Platinum Dynamic 4X reward structure Premium travel benefits Integrated lending feature B2B spend accelerators Spend capacity Rewards reload Priced for higher value 60
Slide 61: Innovative partnerships further our leading position
We continue to strike innovative partnerships to further our leading position Workplace Travel Commerce 61
Slide 62: Amazon partnership video
We continue to strike innovative partnerships to further our leading position Please click on the link titled AMAZON PARTNERSHIP VIDEO on the IR website: https://ir.americanexpress.com/Earnings-and-Events 62
Slide 63: US Small & Medium Enterprises
US Small & Medium Enterprises Global & US SME Int’l SME Large Differentiate and grow core card business Scale working capital and supplier payment solutions Digitize the customer experience 63
Slide 64: Expanded product suite meets working capital needs
Our expanded product suite meets a greater set of US SME customers’ working capital needs Term Loans Card Invoice Financing Relationship Deeper penetration Access to capital supports of customers’ customer growth payables 64
Slide 65: Differentiated AP Automation experience
The AXP relationship combined with new tech delivers a differentiated AP Automation experience Partner Solutions to AXP Solutions Automate Workflow 43% average lift in AXP spend after adopting AP Automation* * Based on current base of active AP Automation users across partners with sufficient spend
Slide 66: AP Automation video
The AXP relationship combined with new tech delivers a differentiated AP Automation experience Please click on the link titled AP AUTOMATION VIDEO on the IR website: https://ir.americanexpress.com/Earnings-and-Events 66
Slide 67: US Small & Medium Enterprises
US Small & Medium Enterprises Global & US SME Int’l SME Large Differentiate and grow core card business Scale working capital and supplier payment solutions Digitize the customer experience 67
Slide 68: Enhanced digital capabilities improve process end-to-end
Enhanced digital capabilities are improving our process end-to-end, complementing other channels Performance Shopping & Customer Loyalty Above-the-Line Marketing Conversion Marketing Brand Campaign 68
Slide 69: Digital capabilities driving growth and efficiencies
These digital capabilities are driving both growth and distribution efficiencies 53% +83% 10X of US accounts YOY growth in higher billed business acquired digitally, accounts acquired among digitally 18% YoY growth through digital referral engaged customers* * U.S. Small Business Card Customers who
Slide 70: International Small & Medium Enterprises
International Small & Medium Enterprises Global & US SME Int’l SME Large Differentiate and grow core card business Scale working capital and supplier payment solutions 70
Slide 71: Rapid growth across largest international countries
We are driving rapid growth across our largest international countries, with significant runway UK JPN CAN MEX AUS 2018 SME Fx-adj. Billings Growth* 45% 27% 15% 23% 25% Estimated AXP Penetration** 2% 5% 7% 5% 4% * See Annex F for reported billed business growth rates. ** Customer penetration calcula
Slide 72: Replicating the US playbook
We are replicating and adapting our US “playbook” while investing in distribution and capabilities Growth Drivers Case Study Investment in Commercial distribution Premium Consumer & Investment in digital capabilities Business Cards Consumer products Single Digital infrastructure Channel Inte
Slide 73: International Small & Medium Enterprises
International Small & Medium Enterprises Global & US SME Int’l SME Large Differentiate and grow core card business Scale working capital and supplier payment solutions 73
Slide 74: Cross-border payment solutions
We are addressing customer cross-border payment needs with a range of capabilities and solutions Growing Opportunity Customer Needs AXP Solutions ~8B Quick, efficient and FX International flexible solution Payments Cross-border B2B Secure and transactions in 2018, transparent process Global Curr
Slide 75: Global & Large Enterprises
Global & Large Enterprises Global & US SME Int’l SME Large Differentiate and grow core card business Scale working capital and supplier payment solutions 75
Slide 76: Industry benchmarking and insights
We are using our scale & integrated network model to generate robust industry benchmarking & insights Analytics Engine Customer Impact Improved control: Non- compliant spend reduced by over 40% for a global client Savings opportunities: Cost per mile savings of 7% on top 20 routes for a global c
Slide 77: Global & Large Enterprises
Global & Large Enterprises Global & US SME Int’l SME Large Differentiate and grow core card business Scale working capital and supplier payment solutions 77
Slide 78: Early Pay helps optimize supplier payments
Innovative products like Early Pay help customers optimize a greater portion of their supplier payments Buyers Suppliers Want to pay their Want to be paid suppliers later earlier 78
Slide 79: Embedding AXP solutions in client AP environments
Through our partnerships we are embedding AXP solutions in client AP environments B2B Networks Approach & Partners •AXP Value Drivers Greater monetization and working capital $2.8T 60% Increased control and security through virtual payments of transacted commerce of AXP Global across SAP Ariba,
Slide 80: Commercial and B2B Agenda
Commercial and B2B Agenda Commercial and B2B Today Opportunity and Growth Potential Growth Priorities Conclusion 80
Slide 81: Executing strategic priorities will drive positive economics
Executing on our strategic priorities will drive positive economics Global & US SME Int’l SME Large Further strengthen Achieve scale in Increase T&E spend leadership in cards international capture & retention priority growth Expand reach countries Capture greater beyond cards in share of o
Slide 82: Don't do business without it
_— DON’T do busin€S¢ witHouT IT’
Slide 83: Agenda
Agenda CEO Update Steve Squeri 2 Commercial Global Commercial and B2BServices Expansion Anna Marrs 2 Digital Mohammed Badi Financial Outlook Jeff Campbell Q&A 83
Slide 84: Digital Overview
Digital Overview 1 Amex has transformed into a digital-first company Our digital-first approach spans all elements of our 2 differentiated model As we look forward, we believe we are well placed 3 to capitalize on what the future holds 84
Slide 85: Evolving payments landscape creates growth opportunities
The payments landscape is evolving, creating new and attractive growth opportunities Cash conversion + growth of e-commerce Proliferation of digital payments Advancing technologies Open banking + machine learning New frontiers for real-time credit and lending in digital channels Changing customer ne
Slide 86: Amex's own digital transformation
In parallel, Amex has undergone its own digital transformation 2010 2011 2012 2013 2014 2015 2016 2017 2018 2019 Digitizing Reimagined customer journeys our core Building new digital products Fraud Receipt capture E-commerce Alexa Smart Amex Global skill mobile Go dining and experiences prevention a
Slide 87: Today we operate as a digital-first company
Today, we operate as a digital-first company Acquisition Engagement Spend Servicing 4 of 5 ~35% 70% 78% largest Amex merchants are of new Card of active digital companies3 ~50% ~60% Members acquired accounts are through digital digitally engaged2 self servicing channels1 accounts of billings are Q1‘
Slide 88: Customers demonstrate high engagement
Our customers demonstrate high engagement… Increased engagement Consumer and SME Corporate Merchant Digitally acquired Card Members are… And overall…. 57% ~70% +22 32% more likely to of acquired higher NPS when growth in engage with accounts are app active3 merchant-funded our app1 digitally active
Slide 89: Business thrives in new digital reality
…and our business thrives in this new digital reality Increased marketing Increased spend1 Decrease in fraud Decrease in opex efficiencies Average Spend SME Average Spend Consumer US Net Fraud Loss Rate 2011 - 2018 (bps) 92% Payments received digitally3 21% +11% +36% 3.5 2.5 70% Paperless statement
Slide 90: Digital Overview
Digital Overview 1 Amex has transformed into a digital-first company Our digital-first approach spans all elements of 2 our differentiated model As we look forward, we believe we are well placed 3 to capitalize on what the future holds 90
Slide 91: Business model suited to evolving digital landscape
Our business model is well suited to take advantage of the evolving digital landscape End-to-End, Integrated Payments Platform Cardmembers Merchants Relationships Economics Data Building new Creating Digitizing Evolving our digital products digital our core analytics stack and experiences partnershi
Slide 92: Digitization of our core in customer journeys
Key to our transformation is the digitization of our core, brought to life in customer journeys Acquisition Engagement Spend Servicing Apply for my card Use my Amex Pay online with Update my Set up my account Offers my Amex card account Refer a friend or Redeem my points Pay my suppl
Slide 93: Leading digital acquisition experience
American Express has developed a leading digital acquisition experience Prospect is approved Friend refers Prospect applies and provisioned Tailored across: Mobile-first Dynamic Offer Pre-filled fields decisioning Messaging to shorten Digital card application seamlessly added Product t
Slide 94: Digital programs connect merchants and Card Members
Our digital programs help connect merchants and Card Members in the Amex ecosystem Merchant designs Amex delivers Merchant makes sale campaign merchant offer with offer Customized offer Available in Push notification at construct mobile and purchase Flexible rewards web Seamless, integrate
Slide 95: Industry-leading automation across processes
Increasingly, these journeys rely on industry- leading automation that covers multiple processes Our automation evolution …and we have streamlined began five years ago… operations across the business Manual review of Verifying ID with Began targeted investment applicant IDs Optical Character '14 in
Slide 96: Network modernization
Supporting each customer journey are the ongoing investments in network modernization B2B Speed Innovation Flexibility Payments 96
Slide 97: Digitally-enabled products and experiences
Beyond customer journeys, Amex has delivered a range of digitally-enabled products and experiences Consumer Commercial Merchant & Network Spend, lend and loyalty SME financing solutions Amex Offers solutions T&E management Fraud management Smart mobile concierge and insights solutions
Slide 98: Best-in-class mobile app
Our best-in-class mobile app is a hub for many of these products and experiences Pay It Plan It Lounges Dining Upgrade your Gold to Platinum You are pre-approved to upgrade to a Platinum card and take advantage of new benefits. Amex Offers #1 Best Credit Card App in Customer Satisfaction* “Major fea
Slide 99: Channels to digitally interact with customers
In addition to our app, we use a range of channels to digitally interact with customers in real time 96% Messaging in Amex app combines automated and human servicing Growth in Alexa skill allows for voice servicing mobile messaging and benefit notifications conversations* Facebook messenger inte
Slide 100: Capitalizing on expanding data
We capitalize on our expanding data in new ways, enhancing all of our products and experiences… We have multiple sources of valuable data... Card Members Merchant Locations …and we are at different points in our journey to action this data Fraud and Risk Marketing Personalization 100
Slide 101: Successful results from machine learning models
…and we’ve seen successful results from our leading machine learning models Fraud Credit US net fraud loss rate gap, Amex vs. industry, 2011 vs. 2018 (bps)* 2.5 bps 5 bps 90% of approvable new account decisions are driven by machine learning** 2011 2012 2013 2014 2015 2016 2017 2018 Industry weighte
Slide 102: Partnerships to deliver digital experiences
In addition, we pursue a broad array of partnerships to deliver digital experiences customers value Apple The trademarks, logos and service marks used on this slide and throughout this presentation are the property of their respective owners. 102
Slide 103: PayPal partnership
Our partnership with PayPal creates new digital utility for Card Members Peer-to-peer payments Relevance with Industry-first integration will Millennials and enable eligible Card Members to send money to friends from the Gen Z Amex app Leader in Pay with Points peer-to-peer Eligible Card Members
Slide 104: Apple partnership
Our partnership with Apple drives digital billings growth by delivering Card Member value Scaled Apple Pay enablement Apple Amex is present with Apple Pay in more countries than any Key merchant other issuer for Card Member spend iTunes collaboration Direct link to iTunes receipt Popular mobile
Slide 105: Digital Overview
Digital Overview 1 Amex has transformed into a digital-first company Our digital-first approach spans all elements of our 2 differentiated model As we look forward, we believe we are well placed 3 to capitalize on what the future holds 105
Slide 106: Existing strengths and ability to move quickly
As our landscape evolves, we can draw on our existing strengths and ability to move quickly Strong foundation Enterprise-wide digital teams Digital product and tech organizations: consolidated digital decisions, engineer base, $1.2T hackathons and pilots #1 Financial Annual Billed Digital Labs:
Slide 107: Essential in the digital lives of customers
We will continue finding ways to be essential in the digital lives of our customers… Fixed monthly fee. No interest. Split Merchant: Engagement up ABC Carpet & Home transaction into monthly payments: Scaling ecosystem of local and national offers sourced by third parties Further experimentation
Slide 108: Differentiated model facilitates digital integration
…enabled by our differentiated model that facilitates digital integration across the value chain Issuer Network Merchant Acquirer 108
Slide 109: Closing thoughts
Closing thoughts 1 Amex has transformed into a digital-first company Our digital-first approach spans all elements of 2 our differentiated model As we look forward, we believe we are well placed 3 to capitalize on what the future holds 109
Slide 110: Don't live digital without it
DON'T )é digital WITHOUT IT” DON’T lwe life WITHOUT IT" DON’T do business WITHOUT IT”
Slide 111: Agenda
Agenda CEO Update Steve Squeri 2 Commercial Global Commercial and B2BServices Expansion Anna Marrs 2 Digital Mohammed Badi Financial Outlook Jeff Campbell Q&A 111
Slide 112: Key Themes from Today
Key Themes from Today We have strong momentum in our core business and a foundation for growth. We will accelerate progress against our strategic imperatives through three enterprise-wide initiatives We are a leader in commercial payments and focused on growing our core card business as well as
Slide 113: Financial Growth Algorithm
Financial Growth Algorithm We are focused on sustaining high levels of Revenue growth that deliver steady and consistent double-digit EPS growth 113
Slide 114: Investment strategy drives share, scale, relevance
Our investment strategy drives share, scale, relevance… Long-term 2018 Stats focus Increase in U.S. Billings share(1) and U.S. Consumer Lending share(2) AXP Billings growth exceeds industry in 7 of 8 top international SHARE countries(3) 19% Increase in New Cards Acquired Largest U.S. Small B
Slide 115: Strong and sustainable revenue growth
…which leads to strong and sustainable revenue growth Revenue growth at least 8% for six consecutive quarters % Increase/(decrease) vs. Prior year (Fx-adjusted): 10% 10% 10% 9% 8% 8% Q3'17 Q4'17 Q1'18 Q2'18 Q3'18 Q4'18 Total Revenue Net of Interest Expense adjusted for Fx and the related growth rate
Slide 116: Results and guidance
Our results and guidance are in line with our focus on high revenue growth and double digit earnings growth Investment 2018 Actuals 2019 Guidance Strategy Share 10% 8-10% Revenue Growth Revenue Growth (Fx adjusted*) Scale Relevance 13% $7.85-$8.35 Adj. EPS Growth** EPS The 2019 adjusted EPS gu
Slide 117: AXP Financial Model
Revenue Investments Opex Risk Management Capital AXP Financial Model We are focused on driving topline growth that delivers steady and consistent earnings per share growth, generated by: Broad-based and sustainable revenue growth Increasingly efficient investments in areas that drive share, scal
Slide 118: Revenue growth is broad-based
Revenue Investments Opex Risk Management Capital Our revenue growth is broad-based… Revenue Breakdown FY 2018 Growth Contribution (Fx Adjusted) YOY to growth % of Total Discount Revenue 8% 5% 61% Net Card Fees 12% 1% 9% Other Revenue 1% 0% 11% Spend & Fee Revenue 8% 6% 81% Net Interest Income 19% 3%
Slide 119: Spend and fee-driven business
Revenue Investments Opex Risk Management Capital …and we continue to be a spend and fee-driven business Revenue Mix 19% 19% 20-25% Net Interest Illustrative Income Assumption: Growth from Lending Spend & & Card Fees is 1.5x 75-80% 81% 81% growth from Spend Fee for next 10 years Revenue 2006 * 2018 ~
Slide 120: Proprietary billings growth by geography and segment
Revenue Investments Opex Risk Management Capital Proprietary billings growth was strong across geographies and customer segments… % Increase/(decrease) vs. Prior year (Fx-adjusted): FY 2018 Proprietary Billings Growth FY 2018 Proprietary Billings Growth by Geography by Customer Segment 26% 21% 18% 1
Slide 121: Strong discount revenue growth
Revenue Investments Opex Risk Management Capital …resulting in strong discount revenue growth Discount Revenue Growth % Increase/(decrease) vs. Prior year (Fx-adjusted): 9% 8% 8% 8% 6% Q4'17 Q1'18 Q2'18 Q3'18 Q4'18 Avg. Discount 2.37% 2.37% 2.37% 2.38% 2.36% Rate Discount revenue growth adjusted for
Slide 122: Momentum in net card fees growth
Revenue Investments Opex Risk Management Capital We have momentum in net card fees growth… Net Card Fees Growth % Increase/(decrease) vs. Prior year (Fx-adjusted): 16% 12% 9% 8% 6% Q4'17 Q1'18 Q2'18 Q3'18 Q4'18 Net Card Fees growth adjusted for Fx is a non-GAAP measure. See Annex K for a reconciliat
Slide 123: Global product refreshes and card acquisition
Revenue Investments Opex Risk Management Capital …driven by global product refreshes and strong acquisition and retention on fee-based products Global Refresh Example: Platinum Key AXP Statistics (2018) Platinum refreshed across 8 geographies in 2018 12M cards acquired India Australia Mexico Singapo
Slide 124: Loan growth across lines of business
Revenue Investments Opex Risk Management Capital Loan growth is diverse across our lines of business… 2018 Ending Loans ($B) 13% 13% $86 $62 10% 14% $10 $14 US Consumer Int'l Consumer GCS Total Includes Card Member and Other Loans. See Annex D. 124
Slide 125: Loan growth fueled by existing Card Members
Revenue Investments Opex Risk Management Capital …and is fueled by existing Card Members… Mix of U.S. Card Member Loan Growth* Contribution to U.S. Card Member Loan Growth** 13% 12% 45% 11% 59% 10% 7% 5% 6% 7% U.S. industry revolve 55% growth of 41% 5% 6% 6% *** 5% 5% 2015 2018 2015 2016 2017 2018 G
Slide 126: Increasingly funded by deposit growth
Revenue Investments Opex Risk Management Capital … and increasingly funded by deposit growth… Funding Mix High Yield Personal Savings Rate $ in billions 2.52% High Yield Personal Savings 1M LIBOR $124.7 $132.6 2.10% 3% 3% Short Term Funding 26% 30% Personal Savings * Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 25% 2
Slide 127: Strong lending economics
Revenue Investments Opex Risk Management Capital …resulting in strong lending economics Net Credit Margin 10.4% 8.8% 5.9% 6.8% 7.3% 7.6% 7.8% 7.8% 8.4% 8.4% 2.9% 2.0% 2011 2012 2013 2014 2015 2016 2017 2018 Adj. Net Interest Yield Write Offs See Annex N for a reconciliation of net interest income di
Slide 128: 2019 revenue growth outlook
Revenue Investments Opex Risk Management Capital The strong momentum in 2018 gives us confidence in our 2019 revenue growth outlook 2019 Revenue Guidance: 8%-10% growth Discount Revenue: Led by broad-based proprietary billings growth Net Card Fees: Fueled by acquisition and global product refres
Slide 129: AXP Financial Model
Revenue Investments Opex Risk Management Capital AXP Financial Model We are focused on driving topline growth that delivers steady and consistent earnings per share growth, generated by: Broad-based and sustainable revenue growth Increasingly efficient investments in areas that drive share, scal
Slide 130: Investment optimization process and payback periods
Revenue Investments Opex Risk Management Capital Our rigorous investment optimization process gives us confidence in our returns and payback periods Quantifiable returns in Drive longer term initiatives Payback Period optimization process and brand awareness Short Medium Long Acquiring New Customers
Slide 131: Strong investment opportunities in 2018
Revenue Investments Opex Risk Management Capital We have strong investment opportunities as we saw in 2018 Investment Optimization Process: Plan at beginning of year starts with a baseline level of Investments funded at investments (e.g. brand, acquisition, etc). beginning of year Investments funded
Slide 132: Customer engagement investments increasing
Revenue Investments Opex Risk Management Capital Customer engagement investments are increasing as we focus on initiatives that drive share, scale and relevance… Customer Engagement ($ in billions) 2018 $17.9 Annual Growth: 14% $15.8 2017 2018 Customer engagement reflects Rewards, Marketing and Busi
Slide 133: Investments toward differentiated benefits
Revenue Investments Opex Risk Management Capital …with more investments going towards differentiated benefits 2018 Annual growth ($ in billions) $17.9 14% $15.8 1.8 Card Member Services: Fastest growing 28% line represents differentiated value prop 1.4 Rewards: Based on competitive 9.7 8.7 12% e
Slide 134: Card Member Services differentiated value
Revenue Investments Opex Risk Management Capital Card Member Services includes a range of differentiated value offered to our customers Unique Partnerships Scalable Assets Experiential Access First checked bag free. Lounge 9 lounges with 5 new planned; Private suite on center court access. 35%+ more
Slide 135: Rewards growth in line with proprietary billings
Revenue Investments Opex Risk Management Capital We expect competitive pressure on rewards with growth broadly in line with proprietary billings Rewards to Proprietary Billings % Increase/(decrease) vs. Prior year: Rewards Prop Billings 14% 13% 12% 12% 11% 11% 11% 11% 11% 11% 11% 9% Q4'17 Q1'18 Q2'1
Slide 136: Business development payments to partners
Revenue Investments Opex Risk Management Capital Business development reflects payments to our diverse set of partners, including Corporate, GNS and Cobrands Correlates to Cobrand billings and timing of contract renewals (approx. 5-8 years) Cobrand Payments Business & Other Development: Bus. Dev. M&
Slide 137: Cobrand loans and billings
Revenue Investments Opex Risk Management Capital While cobrands are competitive, our integrated model drives value to partners and attractive economics for AXP 2018 Cobrand Loans & Billings % of AXP Global Billings, Card Member Loans 36% Other * 4% 3% British Airways 4% Hilton 4% 17% Marriott 5% 1%
Slide 138: Account acquisition has increased
Revenue Investments Opex Risk Management Capital Account acquisition has increased… Average Quarterly Proprietary Cards Acquired '18 Avg. (excl. Hilton '11-'14 Avg. '16-'17 Avg. portfolio acquisition) 2.1M 2.6M 2.9M 3.5 * 2.9 3.0 2.9 2.6 2.7 2.6 2.5 2.4 2.5 2.3 2.0 2.0 2.1 2011 2012 2013 2014 Q3'16
Slide 139: Marketing efficiency: billings acquired per dollar
Revenue Investments Opex Risk Management Capital …and marketing has become more efficient with higher billings acquired for every dollar spent AXP Billed Business Acquired per $1 invested Global Consumer 2-year $31 CAGR: 21% $25 $21 2016 2017 2018 Digital $24 $27 $33 Non-Digital $17 $22 $25 Investme
Slide 140: AXP Financial Model
Revenue Investments Opex Risk Management Capital AXP Financial Model We are focused on driving topline growth that delivers steady and consistent earnings per share growth, generated by: Broad-based and sustainable revenue growth Increasingly efficient investments in areas that drive share, scal
Slide 141: Track record of driving operating leverage
Revenue Investments Opex Risk Management Capital We have a proven track record of driving operating leverage… Operating Expense Leverage Indexed to 2010 66% * Adjusted OpEx Billings Key drivers of leverage: Digital servicing Centers of excellence Technology cost efficiencies 6% 2010 2011 2012
Slide 142: Balancing opex investments that drive revenue
Revenue Investments Opex Risk Management Capital … while balancing investments in opex that drive revenue growth Steady cost efficiencies Revenue-driving increases to Opex Servicing Sales Force (Ex: Digital servicing efficiencies) Economies of Scale Expanding Merchant Coverage (Ex: Centers of Excell
Slide 143: AXP Financial Model
Revenue Investments Opex Risk Management Capital AXP Financial Model We are focused on driving topline growth that delivers steady and consistent earnings per share growth, generated by: Broad-based and sustainable revenue growth Increasingly efficient investments in areas that drive share, scal
Slide 144: Through-the-cycle profitability decisions
Revenue Investments Opex Risk Management Capital We are focused on making through-the-cycle profitability decisions… 2018 Revenue Loss Coverage 2018 CCAR Results ~10.5X Highest profit margin* over the CCAR period +Merchant +SME ~9.5X +ICS ~9.0X One of 4 banks with cumulative profits over the 9 q
Slide 145: Through-the-cycle risk decisions
Revenue Investments Opex Risk Management Capital …and through-the-cycle risk decisions… Risk Management Actions Credit line management Pricing actions Tighten underwriting standards Tighten guardrails in higher-risk channels Rebalance acquisition toward higher credit channels Improved co
Slide 146: Credit metrics at historical lows
Revenue Investments Opex Risk Management Capital …which leads to overall credit metrics at historical lows… Total AXP Write-Off Rates 12% 10% 8% 6% 4% 42% 2% 0% 84% Q1’05-Q4’06 estimated based on managed full year write offs, principal only. 2007 -2010 based on managed write off rates, refer to Anne
Slide 147: High quality loan portfolio
Revenue Investments Opex Risk Management Capital …as well as a high quality loan portfolio U.S. Consumer Credit Statistics - % of Total Loans (2018) High FICO to Low Low FICO Low Tenure Balance Transfer FICO Ratio on New vs. 2007 vs. 2007 vs. 2007 Accounts 10x 38% 33% 78% High FICO to Low FICO ratio
Slide 148: 2019 provision growth outlook
Revenue Investments Opex Risk Management Capital Putting all of this together, we expect 2019 Provision growth of less than 30% 2019 Outlook: Provision growth < 30% $ in millions $3,352 $2,760 $2,027 2016 2017 2018 2019 Outlook 148
Slide 149: AXP Financial Model
Revenue Investments Opex Risk Management Capital AXP Financial Model We are focused on driving topline growth that delivers steady and consistent earnings per share growth, generated by: Broad-based and sustainable revenue growth Increasingly efficient investments in areas that drive share, scal
Slide 150: Strong return on equity
Revenue Investments Opex Risk Management Capital Our business generates strong return on equity 2018 Return on Equity 34% 25% 14% 13% 12% 12% 11% 9% AXP DFS USB JPM WFC COF BAC C 150
Slide 151: Track record of increasing dividends
Revenue Investments Opex Risk Management Capital We have a track record of increasing our dividends… Dividend per share 10% 10% Dividend per 8% share growth 12% $1.34 $1.48 $1.13 $1.22 2015 2016 2017 2018 Dividend payout $1.1B $1.1B $1.2B $1.3B 151
Slide 152: Returning capital while achieving CET1 target
Revenue Investments Opex Risk Management Capital …and returning capital to shareholders while achieving our CET1 target capital range of 10-11% Capital Return ($B) Common Equity Tier 1 $5.6 $5.6 13.1% $5.4 $5.5 12.4% 12.3% 11.0% 9.0% $2.9 2014 2015 2016 2017 2018 2014 2015 2016 2017 2018 152
Slide 153: AXP Financial Model
Revenue Investments Opex Risk Management Capital AXP Financial Model We are focused on driving topline growth that delivers steady and consistent earnings per share growth, generated by: Broad-based and sustainable revenue growth Increasingly efficient investments in areas that drive share, scal
Slide 154: Q1 2019 is off to a solid start
Q1 2019 is off to a solid start… Billings and loans growth Revenue growth Provision Customer Engagement 154
Slide 155: Committed to full year 2019 guidance
… and we remain committed to our full year 2019 guidance 2019 Revenue Growth: 8-10% EPS: $7.85 - $8.35 The 2019 adjusted EPS guidance, a non-GAAP measure, is subject to contingencies and legal settlements. A reconciliation to EPS guidance on a GAAP basis is not available without unreasonable efforts
Slide 156: Key Themes
Key Themes We have strong momentum in our core business and a foundation for growth We will accelerate progress against our strategic imperatives by: ‒ Focusing on our customers as a platform for growth ‒ Expanding strategic partnerships ‒ Focusing our international strategy Today, we’re going
Slide 157: American Express
AMERICAN EXPRESS
Slide 158: Q&A
Q&A
Slide 159: Glossary
Glossary Adjusted net interest income — Represents net interest income attributable to Card Member loans and loans Held for Sale (HFS) (which includes, on a GAAP basis, interest that is deemed uncollectible), excluding the impact of interest expense and interest income not attributable to Card Mem
Slide 160: Glossary
Glossary Net write-off rate — principal only — Represents the amount of proprietary consumer or small business Card Member loans or receivables written off, consisting of principal (resulting from authorized transactions), less recoveries, as a percentage of the average loan or receivables balance
Slide 161: Annex A
Annex A Revenues Net of Interest Expense – Reported & Fx-Adjusted* ($ in billions) Q3’16 Q4’16 Q1’17 Q2’17 Q3’17 Q4’17 Q1’18 Q2’18 Q3’18 Q4’18 FY’17 FY’18 GAAP Revenues Net of Interest Expense $8.6 $8.9 $8.7 $9.2 $9.3 $9.7 $9.7 $10.0 $10.1 $10.5 $36.9 $40.3 Fx-Adjusted Revenues Net of Interest* $8.5
Slide 162: Annex B
Annex B Diluted Earnings per Share Growth ($ share amounts) Inc / FY’18 FY’17 (Dec) Diluted EPS – GAAP $7.91 $2.99 # Resolution of certain prior years’ tax (0.18) audits Adjustment to Tax Act provisional charge (0.09) Certain other discrete tax impacts* (0.31) Tax Act provisional charge 2.90 Q4 Disc
Slide 163: Annex C
Annex C Billed Business – Reported & Fx-Adjusted* % Increase/(decrease) vs. prior year FY’18 FY’18 US Consumer Proprietary GCS Reported 10% Reported 11% Fx-Adjusted* 11% Int’l Consumer Proprietary Reported 17% Worldwide Fx-Adjusted* 17% Reported 9% Fx-Adjusted* 9% Total Proprietary Reported 11% Fx-A
Slide 164: Annex D
Annex D Total Loans – Reported ($ in billions) Inc / FY’18 FY’17 (Dec) US Consumer CM Loans $59.9 $53.6 12% Other Loans $2.0 $1.3 55% Total Loans $61.9 $54.9 13% International Consumer CM Loans $9.6 $8.7 10% Other Loans $0.1 $0.1 0% Total Loans $9.7 $8.8 10% GCS CM Loans $12.4 $11.1 12% Other Loans
Slide 165: Annex E
Annex E GCS Billed Business, Total Loans and Revenue Growth ($ in billions) FY’18 FY’17 Inc / (Dec) GCS Billed Business $486 $438 11% Fx-Adjusted GCS Billed Business* $438 11% US SME Billed Business $304 $276 10% Int’l SME Billed Business $58 $48 21% Fx-Adjusted Int’l SME Billed Business* $47 23% Gl
Slide 166: Annex F
Annex F International SME Billed Business Growth – Top 5 Countries % Increase/(decrease) vs. prior year FY’18 UK Reported 48% UK Fx-Adjusted* 45% Japan Reported 28% Japan Fx-Adjusted* 27% Canada Reported 14% Canada Fx-Adjusted* 15% Mexico Reported 20% Mexico Fx-Adjusted* 23% Australia Reported 21% A
Slide 167: Annex G
Annex G Revenue Breakdown – Reported & Fx-Adjusted* ($ in billions) Contr. FY’18 FY’17 Inc / to (Dec) Growth *** GAAP Discount Revenue $24.7 $22.9 8% 5% Fx-Adjusted Discount Revenue* $22.9 8% 5% GAAP Net Card Fees $3.4 $3.1 11% 1% Fx-Adjusted Net Card Fees* $3.1 $12% 1% GAAP Other Revenue** $4.5 $4.
Slide 168: Annex H
Annex H Historical Revenue Mix ($ in billions) % of % of FY’06 FY’18 Total Total GAAP Net Interest Income $2.8 11% $7.7 19% Securitization Activities* $1.9 Adjusted Net Interest Income $4.7 19% $7.7 19% GAAP Noninterest Income $22.0 89% $32.7 81% Securitization Activities* ($1.3) Adjusted Noninteres
Slide 169: Annex I
Annex I Billed Business – Reported & Fx-Adjusted* % Increase/(decrease) vs. prior year FY’18 FY’18 Australia Proprietary Mexico Proprietary Reported 22% Reported 13% Fx-Adjusted* 26% Fx-Adjusted* 16% UK Proprietary EU (excl. UK) Proprietary Reported 24% Reported 16% Fx-Adjusted* 21% Fx-Adjusted* 12%
Slide 170: Annex J
Annex J Discount Revenue – Reported & Fx-Adjusted* ($ in billions) Q4’16 Q1’17 Q2’17 Q3’17 Q4’17 Q1’18 Q2’18 Q3’18 Q4’18 GAAP Discount Revenue $5.6 $5.4 $5.7 $5.7 $6.1 $5.9 $6.2 $6.2 $6.5 Fx-Adjusted Discount Revenue* $5.6 $5.5 $5.8 $5.7 $6.0 YoY% Inc/(Dec) in GAAP Discount Revenue 7% 9% 8% 8% 7% Yo
Slide 171: Annex K
Annex K Net Card Fees – Reported & Fx-Adjusted* ($ in billions) Q4’16 Q1’17 Q2’17 Q3’17 Q4’17 Q1’18 Q2’18 Q3’18 Q4’18 GAAP Net Card Fees $0.7 $0.7 $0.8 $0.8 $0.8 $0.8 $0.8 $0.9 $0.9 Fx-Adjusted Net Card Fees* $0.7 $0.8 $0.8 $0.8 $0.8 YoY% Inc/(Dec) in GAAP Net Card Fees 8% 11% 9% 11% 14% YoY% Inc/(D
Slide 172: Annex L
Annex L US Card Member Loan Growth ($ in billions) 2014 2015 2016 2017 2018 Total U.S. Card Member Loans $62.6 $51.4 $58.3 $64.5 $72.0 CM Loans related to Costco in the U.S. and JetBlue * $15.8 Total U.S. CM loans excl. CM loans related to Costco $46.8 $51.4 $58.3 $64.5 $72.0 in the U.S. and JetBlue
Slide 173: Annex M
Annex M Global Total Loan Growth ($ in billions) 2014 2015 2016 2017 2018 Total Loans $71.3 $59.8 $66.7 $76.1 $85.7 Total Loans related to Costco in the U.S. and JetBlue * $15.8 Total Loans excl. Total loans related to Costco in the U.S. $55.5 $59.8 $66.7 $76.1 $85.7 and JetBlue YoY% Inc/(Dec) in To
Slide 174: Annex N
Annex N Consolidated Adjusted Net Interest Yield on Average Card Member Loans ($ in Millions, except where indicated) 2011 2012 2013 2014 2015 2016 2017 2018 GAAP Net interest income $4,376 $4,628 $5,047 $5,472 $5,922 $5,779 $6,451 $7,663 Exclude: Interest expense not attributable to the Card Member
Slide 175: Annex O
Annex O Total Operating Expenses Indexed to 2010 ($ in billions) 2010 2011 2012 2013 2014 2015 2016 2017 2018 GAAP Total Operating Expenses (OpEx) $10.7 $12.0 $13.4 $13.0 $12.2 $11.8 $10.2 $10.9 $10.9 Operating Expenses Reclassifications $0.2 $0.3 Visa/MasterCard Settlement Payments $0.9 $0.6 GBT Op
Slide 176: Annex P
Annex P Net Write Off Rates (Principal Only) 2005 2006 Q1’ Q2’ Q3’ Q4’ Q1’ Q2’ Q3’ Q4’ Q1’ Q2’ Q3’ Q4’ Q1’ Q2’ Q3’ Q4’ FY* FY* 07 07 07 07 08 08 08 08 09 09 09 09 10 10 10 10 Reported Net Write Off Rate 3.4% 3.1% 3.4% 3.4% 3.4% 3.7% 4.5% 5.5% 5.8% 6.5% 8.0% 9.6% 9.1% 7.4% 7.0% 6.0% 5.1% 4.3% Managed
Slide 177: Annex Q
Annex Q U.S. Consumer – Total Loan % composition vs. 2007 2017 2018 Total U.S. Consumer Total Loans Reduction in % of Loans from Low FICO 40% 38% Reduction in % of Loans from Low Tenure 39% 33% Reduction in % of Loans from Balance Transfers 92% 78% Low FICO defined as below 660. Low Tenure refers to
Slide 178: Forward Looking Statements
Forward Looking Statements This presentation includes forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1995, which are subject to risks and uncertainties. The forward-looking statements, which address American Express Company’s current expectations reg
Slide 179: Forward Looking Statements
Forward Looking Statements the company’s delinquency and write-off rates and growth of provisions for losses being higher or lower than current expectations, which will depend in part on changes in the level of loan and receivable balances and delinquencies generally as well as in macroeconomic fa
Slide 180: Forward Looking Statements
Forward Looking Statements the company’s tax rate not remaining consistent with current expectations, which could be impacted by, among other things, the company’s geographic mix of income, further changes in tax laws and regulation, unfavorable tax audits and other unanticipated tax items; the
Slide 181: Forward Looking Statements
Forward Looking Statements the ability of the company to realize the benefits from its strategic partnerships, which is dependent in part on the ability of the companies to collaborate and develop capabilities, features and functionalities, successfully integrate them in their platforms and techno
Slide 182: American Express
AMERICAN EXPRESS