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NEW YORK - July 24, 2000 -- American Express Company today reported record
quarterly net income of $740 million, up from $646 million in the same period a
year ago. Diluted earnings per share rose 15 percent to $0.54 compared with
$0.47. Net revenues on a managed basis totaled $5.6 billion, up 16 percent from
$4.8 billion. The company's return on equity was 25.5 percent. These results
reflected strong earnings and revenue growth at Travel Related Services and
American Express Financial Advisors, and met the company's long-term targets of
12-15 percent earnings per share growth, at least 8 percent growth in revenues
and a return on equity of 18-20 percent.
Travel Related Services (TRS) reported record quarterly net income of $472
million, up 15 percent from $411 million in the second quarter a year ago.
TRS net revenues increased 17 percent, reflecting higher billed business as well
as strong growth in cardmember loans. These improvements resulted from an
increase of 5.5 million cards in force, up 12 percent from a year ago, and
higher average spending per cardmember. The higher spending was driven by
several factors, including rewards programs and expanded merchant coverage. The
net interest yield on cardmember loans decreased from year-ago levels,
reflecting a higher percentage of loan balances on introductory rates and
lower-rate products. Other revenues increased, primarily reflecting higher fee
income.
The provision for losses on the charge card and lending portfolios grew as a
result of higher volume, partly offset by continued improvement in credit
quality in the lending portfolio. Charge card interest expense grew as a result
of higher volumes and increased borrowing costs. Marketing and promotion
expenses rose as a result of increased business-building activities, while human
resources expenses increased due to greater business volumes. Other operating
expenses rose, reflecting in part the cost of cardmember loyalty programs,
business growth and investment spending. Included in other operating expenses
for the current quarter was a gain related to the sale of an international
leisure travel business. This gain was offset by increased investment spending
and therefore did not have a material impact on net income or total expenses.
The above discussion presents TRS results "on a managed basis" as if there had
been no securitization transactions, which conforms to industry practice. The
attached financials present TRS results on both a managed and reported
basis. Net income is the same in both formats.
On a reported basis, TRS results for the second quarters of 2000 and 1999
included securitization gains of $80 million ($52 million after-tax) and $99
million ($64 million after-tax), respectively. These gains were offset by higher
expenses related to card acquisition activities and therefore had no material
impact on net income or total expenses.
American Express Financial Advisors (AEFA) reported record quarterly net income
of $275 million, up 14 percent from $242 million a year ago.
Net revenues and earnings growth benefited from higher fee revenues due to an
increase in managed assets. This increase reflected positive net sales and
market appreciation over the past 12 months, despite market depreciation during
the quarter. AEFA reported increases in sales of mutual funds, annuities, and
life and other insurance products. Human resources expenses rose, largely
because of compensation costs associated with higher sales, asset levels and
number of financial advisors. Other operating expenses increased from year-ago
levels due to higher business volumes and ongoing investments to build the
business.
American Express Bank/Travelers Cheque (AEB/TC) reported quarterly net income of
$40 million compared with $38 million a year ago.
Net income at American Express Bank reflects greater commission and fee
revenues, partially offset by decreased net interest income mainly due to higher
funding costs. Travelers Cheque results rose slightly due to strong sales and
greater interest income.
Corporate and Other reported net expenses of $47 million, compared with
$45 million a year ago. Results for the current quarter include an investment
gain that was offset by expenses related to business-building initiatives
during the quarter.
Beginning with the 2000 third quarter earnings release, Travelers Cheque results
will be reported as part of TRS, rather than AEB, to reflect recent
organizational changes.
American Express Company (http://www.americanexpress.com), founded in 1850, is a
global travel, financial and network services provider.
<TABLE>
<CAPTION>
American Express Company
------------------------
Financial Summary
-----------------
(Unaudited)
(Dollars in millions)
Quarters Ended
June 30,
-------------- Percentage
2000 1999 Inc/(Dec)
---- ---- --------
<S> <C> <C> <C>
Net Revenues (Managed Basis) (A)
--------------------------------
Travel Related Services $4,278 $3,669 17 %
American Express Financial Advisors 1,081 916 18
American Express Bank/
Travelers Cheque 262 259 1
----- -----
5,621 4,844 16
Corporate and Other,
including adjustments and
eliminations (63) (33) 91
----- -----
CONSOLIDATED NET REVENUES
(MANAGED BASIS) (A) $5,558 $4,811 16
===== =====
Pretax Income
-------------
Travel Related Services $727 $628 16
American Express Financial Advisors 397 353 12
American Express Bank/
Travelers Cheque 4 6 (34)
----- ---
1,128 987 14
Corporate and Other (82) (92) (12)
----- ---
PRETAX INCOME $1,046 $895 17
===== ===
Net Income
----------
Travel Related Services $472 $411 15
American Express Financial Advisors 275 242 14
American Express Bank/
Travelers Cheque 40 38 6
--- ---
787 691 14
Corporate and Other (47) (45) 5
--- ---
NET INCOME $740 $646 15
=== ===
</TABLE>
<TABLE>
<CAPTION>
Six Months Ended
June 30,
---------------- Percentage
2000 1999 Inc/(Dec)
---- ---- --------
<S> <C> <C> <C>
Net Revenues (Managed Basis) (A)
--------------------------------
Travel Related Services $8,322 $7,103 17 %
American Express Financial Advisors 2,100 1,802 17
American Express Bank/
Travelers Cheque 513 506 1
------ -----
10,935 9,411 16
Corporate and Other,
including adjustments and
eliminations (118) (75) 57
------ -----
CONSOLIDATED NET REVENUES
(MANAGED BASIS) (A) $10,817 $9,336 16
====== =====
Pretax Income
-------------
Travel Related Services $1,363 $1,182 15
American Express Financial Advisors 752 665 13
American Express Bank/
Travelers Cheque 7 18 (63)
----- -----
2,122 1,865 14
Corporate and Other (156) (178) (13)
----- -----
PRETAX INCOME $1,966 $1,687 17
===== =====
Net Income
----------
Travel Related Services $888 $774 15
American Express Financial Advisors 520 456 14
American Express Bank/
Travelers Cheque 80 79 1
----- -----
1,488 1,309 14
Corporate and Other (92) (88) 5
----- -----
NET INCOME $1,396 $1,221 14
===== =====
(A) Managed net revenues are reported net of interest expense,
where applicable, and American Express Financial Advisors'
provision for losses and benefits, and exclude the effect
of TRS' securitization activities.
</TABLE>
<TABLE>
<CAPTION>
American Express Company
------------------------
Financial Summary (continued)
-----------------------------
(Unaudited)
Quarters Ended
June 30,
-------------- Percentage
2000 1999 Inc/(Dec)
---- ---- --------
<S> <C> <C> <C>
EARNINGS PER SHARE
Basic
-----
Earnings Per Common Share $0.56 $0.48 17 %
==== ====
Average common shares
outstanding (millions) 1,328 1,342 (1)
===== =====
Diluted
-------
Earnings Per Common Share $0.54 $0.47 15
==== ====
Average common shares
outstanding (millions) 1,361 1,371 (1)
===== =====
Cash dividends declared
per common share $0.08 $0.075 7
==== =====
</TABLE>
<TABLE>
<CAPTION>
Six Months Ended
June 30,
---------------- Percentage
2000 1999 Inc/(Dec)
---- ---- --------
<S> <C> <C> <C>
EARNINGS PER SHARE
Basic
-----
Earnings Per Common Share $1.05 $0.91 15 %
==== ====
Average common shares
outstanding (millions) 1,330 1,342 (1)
===== =====
Diluted
-------
Earnings Per Common Share $1.03 $0.89 16
==== ====
Average common shares
outstanding (millions) 1,361 1,370 (1)
===== =====
Cash dividends declared
per common share $0.16 $0.15 7
==== ====
</TABLE>
<TABLE>
<CAPTION>
Selected Statistical Information
--------------------------------
(Unaudited)
Quarters Ended
June 30,
--------------- Percentage
2000 1999 Inc/(Dec)
---- ---- --------
<S> <C> <C> <C>
Return on Average Equity* 25.5 % 25.3 % -
Common Shares Outstanding (millions) 1,333 1,347 (1)%
Book Value per Common Share:
Actual $7.66 $7.25 6 %
Pro Forma* $8.26 $7.26 14 %
Shareholders' Equity (billions) $10.2 $9.8 5 %
</TABLE>
<TABLE>
<CAPTION>
Six Months Ended
June 30,
---------------- Percentage
2000 1999 Inc/(Dec)
---- ---- --------
<S> <C> <C> <C>
Return on Average Equity* 25.5 % 25.3 % -
Common Shares Outstanding (millions) 1,333 1,347 (1)%
Book Value per Common Share:
Actual $7.66 $7.25 6 %
Pro Forma* $8.26 $7.26 14 %
Shareholders' Equity (billions) $10.2 $9.8 5 %
* Excludes the effect of SFAS No. 115.
</TABLE>
<TABLE>
<CAPTION>
American Express Company
------------------------
Financial Summary
-----------------
(Unaudited)
(Dollars in millions)
Quarters Ended
June 30,
2000
----
<S> <C>
Net Revenues (Managed Basis) (A)
--------------------------------
Travel Related Services $4,278
American Express Financial Advisors 1,081
American Express Bank/Travelers Cheque 262
-----
5,621
Corporate and Other,
including adjustments and eliminations (63)
-----
CONSOLIDATED NET REVENUES (MANAGED BASIS) (A) $5,558
=====
Pretax Income
-------------
Travel Related Services $727
American Express Financial Advisors 397
American Express Bank/Travelers Cheque 4
-----
1,128
Corporate and Other (82)
-----
PRETAX INCOME $1,046
=====
Net Income
----------
Travel Related Services $472
American Express Financial Advisors 275
American Express Bank/Travelers Cheque 40
---
787
Corporate and Other (47)
---
NET INCOME $740
===
</TABLE>
<TABLE>
<CAPTION>
Quarters Ended
March 31,
2000
----
<S> <C>
Net Revenues (Managed Basis) (A)
--------------------------------
Travel Related Services $4,044
American Express Financial Advisors 1,019
American Express Bank/Travelers Cheque 251
-----
5,314
Corporate and Other,
including adjustments and eliminations (55)
-----
CONSOLIDATED NET REVENUES (MANAGED BASIS) (A) $5,259
=====
Pretax Income
-------------
Travel Related Services $636
American Express Financial Advisors 355
American Express Bank/Travelers Cheque 3
---
994
Corporate and Other (74)
---
PRETAX INCOME $920
===
Net Income
----------
Travel Related Services $416
American Express Financial Advisors 245
American Express Bank/Travelers Cheque 40
---
701
Corporate and Other (45)
---
NET INCOME $656
===
</TABLE>
<TABLE>
<CAPTION>
Quarters Ended
December 31,
1999
----
<S> <C>
Net Revenues (Managed Basis) (A)
--------------------------------
Travel Related Services $4,021
American Express Financial Advisors 999
American Express Bank/Travelers Cheque 252
-----
5,272
Corporate and Other,
including adjustments and eliminations (45)
-----
CONSOLIDATED NET REVENUES (MANAGED BASIS) (A) $5,227
=====
Pretax Income
-------------
Travel Related Services $573
American Express Financial Advisors 347
American Express Bank/Travelers Cheque -
---
920
Corporate and Other (76)
---
PRETAX INCOME $844
===
Net Income
----------
Travel Related Services $375
American Express Financial Advisors 238
American Express Bank/Travelers Cheque 35
---
648
Corporate and Other (42)
---
NET INCOME $606
===
</TABLE>
<TABLE>
<CAPTION>
Quarters Ended
September 30,
1999
----
<S> <C>
Net Revenues (Managed Basis) (A)
--------------------------------
Travel Related Services $3,778
American Express Financial Advisors 936
American Express Bank/Travelers Cheque 261
-----
4,975
Corporate and Other,
including adjustments and eliminations (55)
-----
CONSOLIDATED NET REVENUES (MANAGED BASIS) (A) $4,920
=====
Pretax Income
-------------
Travel Related Services $632
American Express Financial Advisors 350
American Express Bank/Travelers Cheque 4
---
986
Corporate and Other (79)
---
PRETAX INCOME $907
===
Net Income
----------
Travel Related Services $413
American Express Financial Advisors 240
American Express Bank/Travelers Cheque 38
--
691
Corporate and Other (43)
---
NET INCOME $648
===
</TABLE>
<TABLE>
<CAPTION>
Quarters Ended
June 30,
1999
----
<S> <C>
Net Revenues (Managed Basis) (A)
--------------------------------
Travel Related Services $3,669
American Express Financial Advisors 916
American Express Bank/Travelers Cheque 259
-----
4,844
Corporate and Other,
including adjustments and eliminations (33)
-----
CONSOLIDATED NET REVENUES (MANAGED BASIS) (A) $4,811
=====
Pretax Income
-------------
Travel Related Services $628
American Express Financial Advisors 353
American Express Bank/Travelers Cheque 6
---
987
Corporate and Other (92)
---
PRETAX INCOME $895
===
Net Income
----------
Travel Related Services $411
American Express Financial Advisors 242
American Express Bank/Travelers Cheque 38
---
691
Corporate and Other (45)
---
NET INCOME $646
===
(A) Managed net revenues are reported net of interest expense, where
applicable, and American Express Financial Advisors' provision
for losses and benefits, and exclude the effect of TRS'
securitization activities.
</TABLE>
<TABLE>
<CAPTION>
American Express Company
------------------------
Financial Summary (continued)
-----------------------------
(Unaudited)
Quarters Ended
June 30,
2000
----
<S> <C>
EARNINGS PER SHARE
Basic
-----
Earnings Per Common Share $0.56
====
Average common shares outstanding (millions) 1,328
=====
Diluted
-------
Earnings Per Common Share $0.54
====
Average common shares outstanding (millions) 1,361
=====
Cash dividends declared per common share $0.08
====
</TABLE>
<TABLE>
<CAPTION>
Quarters Ended
March 31,
2000
----
<S> <C>
EARNINGS PER SHARE
Basic
-----
Earnings Per Common Share $0.49
====
Average common shares outstanding (millions) 1,331
=====
Diluted
-------
Earnings Per Common Share $0.48
====
Average common shares outstanding (millions) 1,362
=====
Cash dividends declared per common share $0.08
====
</TABLE>
<TABLE>
<CAPTION>
Quarters Ended
December 31,
1999
----
<S> <C>
EARNINGS PER SHARE
Basic
-----
Earnings Per Common Share $0.45
====
Average common shares outstanding (millions) 1,335
=====
Diluted
-------
Earnings Per Common Share $0.44
====
Average common shares outstanding (millions) 1,369
=====
Cash dividends declared per common share $0.075
=====
</TABLE>
<TABLE>
<CAPTION>
Quarters Ended
September 30,
1999
----
<S> <C>
EARNINGS PER SHARE
Basic
-----
Earnings Per Common Share $0.48
====
Average common shares outstanding (millions) 1,338
=====
Diluted
-------
Earnings Per Common Share $0.47
====
Average common shares outstanding (millions) 1,369
=====
Cash dividends declared per common share $0.075
=====
</TABLE>
<TABLE>
<CAPTION>
Quarters Ended
June 30,
1999
----
<S> <C>
EARNINGS PER SHARE
Basic
-----
Earnings Per Common Share $0.48
====
Average common shares outstanding (millions) 1,342
=====
Diluted
-------
Earnings Per Common Share $0.47
====
Average common shares outstanding (millions) 1,371
=====
Cash dividends declared per common share $0.075
=====
</TABLE>
<TABLE>
<CAPTION>
Selected Statistical Information
--------------------------------
(Unaudited)
Quarters Ended
June 30,
2000
----
<S> <C>
Return on Average Equity* 25.5 %
Common Shares Outstanding (millions) 1,333
Book Value per Common Share:
Actual $7.66
Pro Forma* $8.26
Shareholders' Equity (billions) $10.2
</TABLE>
<TABLE>
<CAPTION>
Quarters Ended
March 31,
2000
----
<S> <C>
Return on Average Equity* 25.4 %
Common Shares Outstanding (millions) 1,334
Book Value per Common Share:
Actual $7.69
Pro Forma* $7.96
Shareholders' Equity (billions) $10.3
</TABLE>
<TABLE>
<CAPTION>
Quarters Ended
December 31,
1999
----
<S> <C>
Return on Average Equity* 25.3 %
Common Shares Outstanding (millions) 1,341
Book Value per Common Share:
Actual $7.52
Pro Forma* $7.74
Shareholders' Equity (billions) $10.1
</TABLE>
<TABLE>
<CAPTION>
Quarters Ended
September 30,
1999
----
<S> <C>
Return on Average Equity* 25.3 %
Common Shares Outstanding (millions) 1,343
Book Value per Common Share:
Actual $7.26
Pro Forma* $7.47
Shareholders' Equity (billions) $9.7
</TABLE>
<TABLE>
<CAPTION>
Quarters Ended
June 30,
1999
----
<S> <C>
Return on Average Equity* 25.3 %
Common Shares Outstanding (millions) 1,347
Book Value per Common Share:
Actual $7.25
Pro Forma* $7.26
Shareholders' Equity (billions) $9.8
* Excludes the effect of SFAS No. 115.
</TABLE>
<TABLE>
<CAPTION>
(Preliminary)
Travel Related Services
-----------------------
Statements of Income
--------------------
(Unaudited, Managed Basis)
(Dollars in millions)
Quarters Ended
June 30,
-------------- Percentage
2000 1999 Inc/(Dec)
---- ---- --------
<S> <C> <C> <C>
Net Revenues:
Discount Revenue $1,949 $1,662 17.3 %
Net Card Fees 411 393 4.6
Travel Commissions and Fees 507 469 8.3
Other Revenues 848 669 26.6
Lending:
Finance Charge Revenue 948 684 38.7
Interest Expense 385 208 85.2
----- -----
Net Finance Charge Revenue 563 476 18.4
----- -----
Total Net Revenues 4,278 3,669 16.6
----- -----
Expenses:
Marketing and Promotion 330 267 23.6
Provision for Losses and Claims:
Charge Card 344 288 19.4
Lending 332 260 27.9
Other 20 14 42.3
--- ---
Total 696 562 23.9
--- ---
Charge Card Interest Expense 350 257 36.4
Human Resources 1,028 968 6.2
Other Operating Expenses 1,147 987 16.2
----- -----
Total Expenses 3,551 3,041 16.8
----- -----
Pretax Income 727 628 15.7
Income Tax Provision 255 217 17.5
--- ---
Net Income $472 $411 14.8
=== ===
</TABLE>
These Statements of Income are provided on a Managed Basis for analytical
purposes only. They present the income statements of TRS as if there had been no
securitization transactions. Under Statement of Financial Accounting Standards
No.125 (SFAS No. 125), which prescribes the accounting for securitized
receivables, TRS recognized pretax gains of $80 million ($52 million after-tax)
and $99 million ($64 million after-tax) in the second quarters of 2000 and 1999,
respectively, related to the securitization of U.S. receivables. These gains
were invested in additional card acquisition activities and had no material
impact on Net Income or Total Expenses in either quarter. For purposes of this
presentation such gains and corresponding increases in Marketing and Promotion
and Other Operating Expenses have been eliminated in each quarter.
<TABLE>
<CAPTION>
(Preliminary) Travel Related Services
-----------------------
Statements of Income
--------------------
(Unaudited, GAAP Reporting Basis)
(Dollars in millions)
Quarters Ended
June 30,
-------------- Percentage
2000 1999 Inc/(Dec)
---- ---- --------
<S> <C> <C> <C>
Net Revenues:
Discount Revenue $1,949 $1,662 17.3 %
Net Card Fees 411 393 4.6
Travel Commissions and Fees 507 469 8.3
Other Revenues 1,121 845 32.6
Lending:
Finance Charge Revenue 500 465 7.6
Interest Expense 258 156 65.6
----- -----
Net Finance Charge Revenue 242 309 (21.7)
----- -----
Total Net Revenues 4,230 3,678 15.0
----- -----
Expenses:
Marketing and Promotion 378 325 16.3
Provision for Losses and Claims:
Charge Card 302 249 21.4
Lending 170 137 24.1
Other 20 14 42.3
--- ---
Total 492 400 23.1
--- ---
Charge Card Interest Expense 295 198 48.8
Net Discount Expense 131 131 0.5
Human Resources 1,028 968 6.2
Other Operating Expenses 1,179 1,028 14.6
----- -----
Total Expenses 3,503 3,050 14.9
----- -----
Pretax Income 727 628 15.7
Income Tax Provision 255 217 17.5
--- ---
Net Income $472 $411 14.8
=== ===
</TABLE>
<TABLE>
<CAPTION>
(Preliminary) Travel Related Services
-----------------------
Selected Statistical Information
--------------------------------
(Unaudited)
(Amounts in billions, except percentages and where indicated)
Quarters Ended
June 30,
------------- Percentage
2000 1999 Inc/(Dec)
---- ---- --------
<S> <C> <C> <C>
Total Cards in Force (millions):
United States 32.5 28.7 13.1 %
Outside the United States 16.9 15.2 11.2
---- ----
Total 49.4 43.9 12.5
==== ====
Basic Cards in Force (millions):
United States 25.3 22.5 12.6
Outside the United States 12.9 11.7 10.4
---- ----
Total 38.2 34.2 11.8
==== ====
Card Billed Business:
United States $55.8 $46.0 21.5
Outside the United States 18.7 16.4 13.3
---- ----
Total $74.5 $62.4 19.3
==== ====
Average Discount Rate (A) 2.69 % 2.73 % -
Average Basic Cardmember
Spending (dollars) (A) $2,085 $1,933 7.9
Average Fee per Card -
Managed (dollars) (A) $36 $38 (5.3)
Non-Amex Brand (B):
Cards in Force (millions) 0.6 0.2 #
Billed Business $0.7 $0.2 #
Travel Sales $6.2 $6.0 2.9
Travel Commissions and Fees/Sales (C) 8.2 % 7.8 % -
Total Debt $31.1 $30.6 1.6
Shareholder's Equity $5.7 $5.3 8.5
Return on Average Equity (D) 31.2 % 28.8 % -
Return on Average Assets (D) 3.2 % 3.3 % -
</TABLE>
(A) Computed from proprietary card activities only.
(B) This data relates to Visa and Eurocards issued in connection
with joint venture activities.
(C) Computed from information provided herein.
(D) Excluding the effect of SFAS No. 115.
# Denotes variance of more than 100%.
<TABLE>
<CAPTION>
(Preliminary) Travel Related Services
-----------------------
Selected Statistical Information (continued)
--------------------------------------------
(Unaudited, Managed Basis)
(Amounts in billions, except percentages and where indicated)
Quarters Ended
June 30,
-------------- Percentage
2000 1999 Inc/(Dec)
---- ---- --------
<S> <C> <C> <C>
Charge Card Receivables:
Total Receivables $27.4 $24.6 11.3 %
90 Days Past Due as a % of Total 2.4 % 2.6 % -
Loss Reserves (millions) $986 $932 5.9
% of Receivables 3.6 % 3.8 % -
% of 90 Days Past Due 153 % 148 % -
Net Loss Ratio 0.36 % 0.39 % -
U.S. Cardmember Lending:
Total Loans $25.9 $18.3 41.8
Past Due Loans as a % of Total:
30-89 Days 1.6 % 1.8 % -
90+ Days 0.8 % 0.9 % -
Loss Reserves (millions):
Beginning Balance $689 $623 10.6
Provision 268 209 28.3
Net Charge-Offs/Other (271) (230) 18.0
---- ---
Ending Balance $686 $602 13.9
=== ===
% of Loans 2.6 % 3.3 % -
% of Past Due 109 % 124 % -
Average Loans $25.2 $17.4 44.7
Net Write-Off Rate 4.4 % 5.3 % -
Net Interest Yield 7.4 % 9.3 % -
</TABLE>
<TABLE>
<CAPTION>
(Preliminary) Travel Related Services
-----------------------
Statements of Income
--------------------
(Unaudited, Managed Basis)
(Dollars in millions)
Quarters Ended
June 30,
2000
----
<S> <C>
Net Revenues:
Discount Revenue $1,949
Net Card Fees 411
Travel Commissions and Fees 507
Other Revenues 848
Lending:
Finance Charge Revenue 948
Interest Expense 385
-----
Net Finance Charge Revenue 563
-----
Total Net Revenues 4,278
-----
Expenses:
Marketing and Promotion 330
Provision for Losses and Claims:
Charge Card 344
Lending 332
Other 20
---
Total 696
---
Charge Card Interest Expense 350
Human Resources 1,028
Other Operating Expenses 1,147
-----
Total Expenses 3,551
-----
Pretax Income 727
Income Tax Provision 255
---
Net Income $472
===
</TABLE>
<TABLE>
<CAPTION>
Quarters Ended
March 31,
2000
----
<S> <C>
Net Revenues:
Discount Revenue $1,805
Net Card Fees 405
Travel Commissions and Fees 438
Other Revenues 841
Lending:
Finance Charge Revenue 887
Interest Expense 332
-----
Net Finance Charge Revenue 555
-----
Total Net Revenues 4,044
-----
Expenses:
Marketing and Promotion 318
Provision for Losses and Claims:
Charge Card 278
Lending 335
Other 21
---
Total 634
---
Charge Card Interest Expense 314
Human Resources 998
Other Operating Expenses 1,144
-----
Total Expenses 3,408
-----
Pretax Income 636
Income Tax Provision 220
---
Net Income $416
===
</TABLE>
<TABLE>
<CAPTION>
Quarters Ended
December 31,
1999
----
<S> <C>
Net Revenues:
Discount Revenue $1,865
Net Card Fees 408
Travel Commissions and Fees 459
Other Revenues 789
Lending:
Finance Charge Revenue 802
Interest Expense 302
-----
Net Finance Charge Revenue 500
-----
Total Net Revenues 4,021
-----
Expenses:
Marketing and Promotion 338
Provision for Losses and Claims:
Charge Card 227
Lending 332
Other 17
---
Total 576
---
Charge Card Interest Expense 300
Human Resources 1,012
Other Operating Expenses 1,222
-----
Total Expenses 3,448
-----
Pretax Income 573
Income Tax Provision 198
---
Net Income $375
===
</TABLE>
<TABLE>
<CAPTION>
Quarters Ended
September 30,
1999
----
<S> <C>
Net Revenues:
Discount Revenue $1,700
Net Card Fees 399
Travel Commissions and Fees 448
Other Revenues 730
Lending:
Finance Charge Revenue 747
Interest Expense 246
-----
Net Finance Charge Revenue 501
-----
Total Net Revenues 3,778
-----
Expenses:
Marketing and Promotion 340
Provision for Losses and Claims:
Charge Card 247
Lending 312
Other 10
---
Total 569
---
Charge Card Interest Expense 259
Human Resources 968
Other Operating Expenses 1,010
-----
Total Expenses 3,146
-----
Pretax Income 632
Income Tax Provision 219
---
Net Income $413
===
</TABLE>
<TABLE>
<CAPTION>
Quarters Ended
June 30,
1999
----
<S> <C>
Net Revenues:
Discount Revenue $1,662
Net Card Fees 393
Travel Commissions and Fees 469
Other Revenues 669
Lending:
Finance Charge Revenue 684
Interest Expense 208
-----
Net Finance Charge Revenue 476
-----
Total Net Revenues 3,669
-----
Expenses:
Marketing and Promotion 267
Provision for Losses and Claims:
Charge Card 288
Lending 260
Other 14
---
Total 562
---
Charge Card Interest Expense 257
Human Resources 968
Other Operating Expenses 987
-----
Total Expenses 3,041
-----
Pretax Income 628
Income Tax Provision 217
---
Net Income $411
===
</TABLE>
These Statements of Income are provided on a Managed Basis for
analytical purposes only. They present the income statements of TRS as
if there had been no securitization transactions. Under Statement of
Financial Accounting Standards No. 125 (SFAS No. 125), which
prescribes the accounting for securitized receivables, TRS recognized
pretax gains of $80 million ($52 million after-tax) in the second
quarter of 2000, $36 million ($23 million after-tax) in the first
quarter of 2000, $55 million ($36 million after-tax) in the third
quarter of 1999 and $99 million ($64 million after-tax) in the second
quarter of 1999, related to the securitization of U.S. receivables.
These gains were invested in additional card acquisition activities
and had no material impact on Net Income or Total Expenses in any
quarter. For purposes of this presentation such gains and corresponding
increases in Marketing and Promotion and Other Operating Expenses have
been eliminated in each quarter.
<TABLE>
<CAPTION>
(Preliminary) Travel Related Services
-----------------------
Statements of Income
--------------------
(Unaudited, GAAP Reporting Basis)
(Dollars in millions)
Quarters Ended
June 30,
2000
----
<S> <C>
Net Revenues:
Discount Revenue $1,949
Net Card Fees 411
Travel Commissions and Fees 507
Other Revenues 1,121
Lending:
Finance Charge Revenue 500
Interest Expense 258
-----
Net Finance Charge Revenue 242
-----
Total Net Revenues 4,230
-----
Expenses:
Marketing and Promotion 378
Provision for Losses and Claims:
Charge Card 302
Lending 170
Other 20
---
Total 492
---
Charge Card Interest Expense 295
Net Discount Expense 131
Human Resources 1,028
Other Operating Expenses 1,179
-----
Total Expenses 3,503
-----
Pretax Income 727
Income Tax Provision 255
---
Net Income $472
===
</TABLE>
<TABLE>
<CAPTION>
Quarters Ended
March 31,
2000
----
<S> <C>
Net Revenues:
Discount Revenue $1,805
Net Card Fees 405
Travel Commissions and Fees 438
Other Revenues 1,014
Lending:
Finance Charge Revenue 524
Interest Expense 231
-----
Net Finance Charge Revenue 293
-----
Total Net Revenues 3,955
-----
Expenses:
Marketing and Promotion 339
Provision for Losses and Claims:
Charge Card 241
Lending 175
Other 21
---
Total 437
---
Charge Card Interest Expense 260
Net Discount Expense 126
Human Resources 998
Other Operating Expenses 1,159
-----
Total Expenses 3,319
-----
Pretax Income 636
Income Tax Provision 220
---
Net Income $416
===
</TABLE>
<TABLE>
<CAPTION>
Quarters Ended
December 31,
1999
----
<S> <C>
Net Revenues:
Discount Revenue $1,865
Net Card Fees 408
Travel Commissions and Fees 459
Other Revenues 902
Lending:
Finance Charge Revenue 526
Interest Expense 197
-----
Net Finance Charge Revenue 329
-----
Total Net Revenues 3,963
-----
Expenses:
Marketing and Promotion 338
Provision for Losses and Claims:
Charge Card 213
Lending 241
Other 17
---
Total 471
---
Charge Card Interest Expense 246
Net Discount Expense 101
Human Resources 1,012
Other Operating Expenses 1,222
-----
Total Expenses 3,390
-----
Pretax Income 573
Income Tax Provision 198
---
Net Income $375
===
</TABLE>
<TABLE>
<CAPTION>
Quarters Ended
September 30,
1999
----
<S> <C>
Net Revenues:
Discount Revenue $1,700
Net Card Fees 395
Travel Commissions and Fees 448
Other Revenues 846
Lending:
Finance Charge Revenue 513
Interest Expense 165
-----
Net Finance Charge Revenue 348
-----
Total Net Revenues 3,737
-----
Expenses:
Marketing and Promotion 373
Provision for Losses and Claims:
Charge Card 222
Lending 187
Other 10
---
Total 419
---
Charge Card Interest Expense 208
Net Discount Expense 105
Human Resources 968
Other Operating Expenses 1,032
-----
Total Expenses 3,105
-----
Pretax Income 632
Income Tax Provision 219
---
Net Income $413
===
</TABLE>
<TABLE>
<CAPTION>
Quarters Ended
June 30,
1999
----
<S> <C>
Net Revenues:
Discount Revenue $1,662
Net Card Fees 393
Travel Commissions and Fees 469
Other Revenues 845
Lending:
Finance Charge Revenue 465
Interest Expense 156
-----
Net Finance Charge Revenue 309
-----
Total Net Revenues 3,678
-----
Expenses:
Marketing and Promotion 325
Provision for Losses and Claims:
Charge Card 249
Lending 137
Other 14
---
Total 400
---
Charge Card Interest Expense 198
Net Discount Expense 131
Human Resources 968
Other Operating Expenses 1,028
-----
Total Expenses 3,050
-----
Pretax Income 628
Income Tax Provision 217
---
Net Income $411
===
</TABLE>
<TABLE>
<CAPTION>
(Preliminary) Travel Related Services
-----------------------
Selected Statistical Information
--------------------------------
(Unaudited)
(Amounts in billions, except percentages and where indicated)
Quarters Ended
June 30,
2000
----
<S> <C>
Total Cards in Force (millions):
United States 32.5
Outside the United States 16.9
----
Total 49.4
====
Basic Cards in Force (millions):
United States 25.3
Outside the United States 12.9
----
Total 38.2
====
Card Billed Business:
United States $55.8
Outside the United States 18.7
----
Total $74.5
====
Average Discount Rate (A) 2.69 %
Average Basic Cardmember
Spending (dollars) (A) $2,085
Average Fee per Card - Managed (dollars) (A) $36
Non-Amex Brand (B):
Cards in Force (millions) 0.6
Billed Business $0.7
Travel Sales $6.2
Travel Commissions and Fees/Sales (C) 8.2 %
Total Debt $31.1
Shareholder's Equity $5.7
Return on Average Equity (D) 31.2 %
Return on Average Assets (D) 3.2 %
</TABLE>
<TABLE>
<CAPTION>
Quarters Ended
March 31,
2000
----
<S> <C>
Total Cards in Force (millions):
United States 31.4
Outside the United States 16.5
----
Total 47.9
====
Basic Cards in Force (millions):
United States 24.5
Outside the United States 12.6
----
Total 37.1
====
Card Billed Business:
United States $50.6
Outside the United States 17.7
----
Total $68.3
====
Average Discount Rate (A) 2.72 %
Average Basic Cardmember
Spending (dollars) (A) $1,980
Average Fee per Card - Managed (dollars) (A) $37
Non-Amex Brand (B):
Cards in Force (millions) 0.6
Billed Business $0.5
Travel Sales $5.5
Travel Commissions and Fees/Sales (C) 8.0 %
Total Debt $34.0
Shareholder's Equity $5.6
Return on Average Equity (D) 30.5 %
Return on Average Assets (D) 3.2 %
</TABLE>
<TABLE>
<CAPTION>
Quarters Ended
December 31,
1999
----
<S> <C>
Total Cards in Force (millions):
United States 29.9
Outside the United States 16.1
----
Total 46.0
====
Basic Cards in Force (millions):
United States 23.4
Outside the United States 12.3
----
Total 35.7
====
Card Billed Business:
United States $51.7
Outside the United States 19.1
----
Total $70.8
====
Average Discount Rate (A) 2.71 %
Average Basic Cardmember
Spending (dollars) (A) $2,102
Average Fee per Card - Managed (dollars) (A) $38
Non-Amex Brand (B):
Cards in Force (millions) 0.3
Billed Business $0.2
Travel Sales $5.6
Travel Commissions and Fees/Sales (C) 8.2 %
Total Debt $35.8
Shareholder's Equity $5.4
Return on Average Equity (D) 30.1 %
Return on Average Assets (D) 3.2 %
</TABLE>
<TABLE>
<CAPTION>
Quarters Ended
September 30,
1999
----
<S> <C>
Total Cards in Force (millions):
United States 29.2
Outside the United States 15.6
----
Total 44.8
====
Basic Cards in Force (millions):
United States 22.9
Outside the United States 12.0
----
Total 34.9
====
Card Billed Business:
United States $47.1
Outside the United States 17.0
----
Total $64.1
====
Average Discount Rate (A) 2.73 %
Average Basic Cardmember
Spending (dollars) (A) $1,935
Average Fee per Card - Managed (dollars) (A) $38
Non-Amex Brand (B):
Cards in Force (millions) 0.2
Billed Business $0.2
Travel Sales $5.5
Travel Commissions and Fees/Sales (C) 8.1 %
Total Debt $30.8
Shareholder's Equity $5.4
Return on Average Equity (D) 29.3 %
Return on Average Assets (D) 3.3 %
</TABLE>
<TABLE>
<CAPTION>
Quarters Ended
June 30,
1999
----
<S> <C>
Total Cards in Force (millions):
United States 28.7
Outside the United States 15.2
----
Total 43.9
====
Basic Cards in Force (millions):
United States 22.5
Outside the United States 11.7
----
Total 34.2
====
Card Billed Business:
United States $46.0
Outside the United States 16.4
----
Total $62.4
====
Average Discount Rate (A) 2.73 %
Average Basic Cardmember
Spending (dollars) (A) $1,933
Average Fee per Card - Managed (dollars) (A) $38
Non-Amex Brand (B):
Cards in Force (millions) 0.2
Billed Business $0.2
Travel Sales $6.0
Travel Commissions and Fees/Sales (C) 7.8 %
Total Debt $30.6
Shareholder's Equity $5.3
Return on Average Equity (D) 28.8 %
Return on Average Assets (D) 3.3 %
</TABLE>
(A) Computed from proprietary card activities only.
(B) This data relates to Visa and Eurocards issued in
connection with joint venture activities.
(C) Computed from information provided herein.
(D) Excluding the effect of SFAS No. 115.
<TABLE>
<CAPTION>
(Preliminary) Travel Related Services
-----------------------
Selected Statistical Information (continued)
--------------------------------------------
(Unaudited, Managed Basis)
(Amounts in billions, except percentages and where indicated)
Quarters Ended
June 30,
2000
----
<S> <C>
Charge Card Receivables:
Total Receivables $27.4
90 Days Past Due as a % of Total 2.4 %
Loss Reserves (millions) $986
% of Receivables 3.6 %
% of 90 Days Past Due 153 %
Net Loss Ratio 0.36 %
U.S. Cardmember Lending:
Total Loans $25.9
Past Due Loans as a % of Total:
30-89 Days 1.6 %
90+ Days 0.8 %
Loss Reserves (millions):
Beginning Balance $689
Provision 268
Net Charge-Offs/Other (271)
---
Ending Balance $686
===
% of Loans 2.6 %
% of Past Due 109 %
Average Loans $ 25.2
Net Write-Off Rate 4.4 %
Net Interest Yield 7.4 %
</TABLE>
<TABLE>
<CAPTION>
Quarters Ended
March 31,
2000
----
<S> <C>
Charge Card Receivables:
Total Receivables $26.8
90 Days Past Due as a % of Total 2.6 %
Loss Reserves (millions) $894
% of Receivables 3.3 %
% of 90 Days Past Due 129 %
Net Loss Ratio 0.34 %
U.S. Cardmember Lending:
Total Loans $24.2
Past Due Loans as a % of Total:
30-89 Days 1.8 %
90+ Days 0.8 %
Loss Reserves (millions):
Beginning Balance $672
Provision 285
Net Charge-Offs/Other (268)
---
Ending Balance $689
===
% of Loans 2.8 %
% of Past Due 109 %
Average Loans $23.6
Net Write-Off Rate 4.6 %
Net Interest Yield 7.8 %
</TABLE>
<TABLE>
<CAPTION>
Quarters Ended
December 31,
1999
----
<S> <C>
Charge Card Receivables:
Total Receivables $27.0
90 Days Past Due as a % of Total 2.5 %
Loss Reserves (millions) $857
% of Receivables 3.2 %
% of 90 Days Past Due 126 %
Net Loss Ratio 0.40 %
U.S. Cardmember Lending:
Total Loans $23.4
Past Due Loans as a % of Total:
30-89 Days 1.8 %
90+ Days 0.8 %
Loss Reserves (millions):
Beginning Balance $636
Provision 277
Net Charge-Offs/Other (241)
---
Ending Balance $672
===
% of Loans 2.9 %
% of Past Due 110 %
Average Loans $21.7
Net Write-Off Rate 4.5 %
Net Interest Yield 7.7 %
</TABLE>
<TABLE>
<CAPTION>
Quarters Ended
September 30,
1999
----
<S> <C>
Charge Card Receivables:
Total Receivables $25.3
90 Days Past Due as a % of Total 2.5 %
Loss Reserves (millions) $907
% of Receivables 3.6 %
% of 90 Days Past Due 144 %
Net Loss Ratio 0.41 %
U.S. Cardmember Lending:
Total Loans $20.6
Past Due Loans as a % of Total:
30-89 Days 2.0 %
90+ Days 0.8 %
Loss Reserves (millions):
Beginning Balance $602
Provision 264
Net Charge-Offs/Other (230)
---
Ending Balance $636
===
% of Loans 3.1 %
% of Past Due 111 %
Average Loans $19.8
Net Write-Off Rate 4.7 %
Net Interest Yield 8.5 %
</TABLE>
<TABLE>
<CAPTION>
Quarters Ended
June 30,
1999
----
<S> <C>
Charge Card Receivables:
Total Receivables $24.6
90 Days Past Due as a % of Total 2.6 %
Loss Reserves (millions) $932
% of Receivables 3.8 %
% of 90 Days Past Due 148 %
Net Loss Ratio 0.39 %
U.S. Cardmember Lending:
Total Loans $18.3
Past Due Loans as a % of Total:
30-89 Days 1.8 %
90+ Days 0.9 %
Loss Reserves (millions):
Beginning Balance $623
Provision 209
Net Charge-Offs/Other (230)
---
Ending Balance $602
===
% of Loans 3.3 %
% of Past Due 124 %
Average Loans $17.4
Net Write-Off Rate 5.3 %
Net Interest Yield 9.3 %
</TABLE>
<TABLE>
<CAPTION>
(Preliminary) American Express Financial Advisors
-----------------------------------
Statements of Income
--------------------
(Unaudited)
(Dollars in millions)
Quarters Ended
June 30,
-------------- Percentage
2000 1999 Inc/(Dec)
---- ---- --------
<S> <C> <C> <C>
Net Revenues:
Investment Income $592 $615 (3.7) %
Management and Distribution Fees 701 553 27.0
Other Revenues 248 226 9.5
----- -----
Total Revenues 1,541 1,394 10.6
Provision for Losses and Benefits:
Annuities 254 273 (6.9)
Insurance 138 132 4.6
Investment Certificates 68 73 (6.2)
----- -----
Total 460 478 (3.6)
----- -----
Net Revenues 1,081 916 18.0
----- -----
Expenses:
Human Resources 528 430 22.8
Other Operating Expenses 156 133 17.4
--- ---
Total Expenses 684 563 21.5
--- ---
Pretax Income 397 353 12.4
Income Tax Provision 122 111 9.3
--- ---
Net Income $275 $242 13.8
=== ===
</TABLE>
<TABLE>
<CAPTION>
(Preliminary) American Express Financial Advisors
-----------------------------------
Selected Statistical Information
--------------------------------
(Unaudited)
(Dollars in millions, except where indicated)
Quarters Ended
June 30,
-------------- Percentage
2000 1999 Inc/(Dec)
---- ---- --------
<S> <C> <C> <C>
Investments (billions) $30.0 $30.7 (2.0) %
Client Contract Reserves (billions) $31.0 $30.8 0.9
Shareholder's Equity (billions) $4.0 $4.0 -
Return on Average Equity* 23.1 % 22.8 % -
Life Insurance in Force (billions) $93.8 $84.6 10.9
Assets Owned, Managed or
Administered (billions):
Assets Managed for Institutions $56.1 $49.8 12.7
Assets Owned, Managed or Administered
for Individuals:
Owned Assets:
Separate Account Assets 36.5 30.1 21.3
Other Owned Assets 39.9 37.8 5.5
---- -----
Total Owned Assets 76.4 67.9 12.5
Managed Assets 119.6 102.1 17.1
Administered Assets 34.1 20.8 64.1
----- -----
Total $286.2 $240.6 19.0
===== =====
Market Appreciation (Depreciation)
During the Period:
Owned Assets:
Separate Account Assets $(2,301) $1,520 -
Other Owned Assets $(90) $(395) (77.2)
Total Managed Assets $(6,488) $5,329 -
Cash Sales:
Mutual Funds $10,376 $8,872 17.0
Annuities 1,566 980 59.8
Investment Certificates 871 835 4.3
Life and Other Insurance Products 219 169 29.9
Institutional 1,557 1,432 8.7
Other 661 805 (18.0)
------ ------
Total Cash Sales $15,250 $13,093 16.5
====== ======
Number of Financial Advisors 11,486 10,489 9.5
Fees from Financial Plans and
Advice Services $23.9 $22.8 4.6
Percentage of Total Sales from
Financial Plans and Advice Services 66.1 % 65.2 % -
</TABLE>
* Excluding the effect of SFAS No. 115.
Note: In the first quarter of 2000, reporting of data related to
cash sales and assets owned, managed and administered was
revised to better reflect AEFA's multiple sales channel
strategy and broadening of its product portfolio through
additional non-proprietary offerings.
<TABLE>
<CAPTION>
(Preliminary) American Express Financial Advisors
-----------------------------------
Statements of Income
--------------------
(Unaudited)
(Dollars in millions)
Quarters Ended
June 30,
2000
----
<S> <C>
Net Revenues:
Investment Income $592
Management and Distribution Fees 701
Other Revenues 248
-----
Total Revenues 1,541
Provision for Losses and Benefits:
Annuities 254
Insurance 138
Investment Certificates 68
-----
Total 460
-----
Net Revenues 1,081
-----
Expenses:
Human Resources 528
Other Operating Expenses 156
---
Total Expenses 684
---
Pretax Income 397
Income Tax Provision 122
---
Net Income $275
===
</TABLE>
<TABLE>
<CAPTION>
Quarters Ended
March 31,
2000
----
<S> <C>
Net Revenues:
Investment Income $572
Management and Distribution Fees 688
Other Revenues 246
-----
Total Revenues 1,506
Provision for Losses and Benefits:
Annuities 259
Insurance 139
Investment Certificates 89
-----
Total 487
-----
Net Revenues 1,019
-----
Expenses:
Human Resources 498
Other Operating Expenses 166
---
Total Expenses 664
---
Pretax Income 355
Income Tax Provision 110
---
Net Income $245
===
</TABLE>
<TABLE>
<CAPTION>
Quarters Ended
December 31,
1999
----
<S> <C>
Net Revenues:
Investment Income $668
Management and Distribution Fees 616
Other Revenues 245
-----
Total Revenues 1,529
Provision for Losses and Benefits:
Annuities 276
Insurance 130
Investment Certificates 124
---
Total 530
---
Net Revenues 999
---
Expenses:
Human Resources 443
Other Operating Expenses 209
---
Total Expenses 652
---
Pretax Income 347
Income Tax Provision 109
---
Net Income $238
===
</TABLE>
<TABLE>
<CAPTION>
Quarters Ended
September 30,
1999
----
<S> <C>
Net Revenues:
Investment Income $566
Management and Distribution Fees 578
Other Revenues 224
-----
Total Revenues 1,368
Provision for Losses and Benefits:
Annuities 251
Insurance 135
Investment Certificates 46
---
Total 432
---
Net Revenues 936
---
Expenses:
Human Resources 456
Other Operating Expenses 130
---
Total Expenses 586
---
Pretax Income 350
Income Tax Provision 110
---
Net Income $240
===
</TABLE>
<TABLE>
<CAPTION>
Quarters Ended
June 30,
1999
----
<S> <C>
Net Revenues:
Investment Income $615
Management and Distribution Fees 553
Other Revenues 226
-----
Total Revenues 1,394
Provision for Losses and Benefits:
Annuities 273
Insurance 132
Investment Certificates 73
---
Total 478
---
Net Revenues 916
---
Expenses:
Human Resources 430
Other Operating Expenses 133
---
Total Expenses 563
---
Pretax Income 353
Income Tax Provision 111
---
Net Income $242
===
</TABLE>
<TABLE>
<CAPTION>
(Preliminary) American Express Financial Advisors
-----------------------------------
Selected Statistical Information
--------------------------------
(Unaudited)
(Dollars in millions, except where indicated)
Quarters Ended
June 30,
2000
----
<S> <C>
Investments (billions) $30.0
Client Contract Reserves (billions) $31.0
Shareholder's Equity (billions) $4.0
Return on Average Equity* 23.1 %
Life Insurance in Force (billions) $93.8
Assets Owned, Managed or
Administered (billions):
Assets Managed for Institutions $56.1
Assets Owned, Managed or Administered
for Individuals:
Owned Assets:
Separate Account Assets 36.5
Other Owned Assets 39.9
-----
Total Owned Assets 76.4
Managed Assets 119.6
Administered Assets 34.1
-----
Total $286.2
=====
Market Appreciation (Depreciation)
During the Period:
Owned Assets:
Separate Account Assets $(2,301)
Other Owned Assets $(90)
Total Managed Assets $(6,488)
Cash Sales:
Mutual Funds $10,376
Annuities 1,566
Investment Certificates 871
Life and Other Insurance Products 219
Institutional 1,557
Other 661
------
Total Cash Sales $15,250
======
Number of Financial Advisors 11,486
Fees from Financial Plans and Advice Services $23.9
Percentage of Total Sales from Financial Plans
and Advice Services 66.1 %
</TABLE>
<TABLE>
<CAPTION>
Quarters Ended
March 31,
2000
----
<S> <C>
Investments (billions) $30.3
Client Contract Reserves (billions) $31.0
Shareholder's Equity (billions) $3.9
Return on Average Equity* 23.0 %
Life Insurance in Force (billions) $91.7
Assets Owned, Managed or
Administered (billions):
Assets Managed for Institutions $57.4
Assets Owned, Managed or Administered
for Individuals:
Owned Assets:
Separate Account Assets 38.4
Other Owned Assets 39.8
-----
Total Owned Assets 78.2
Managed Assets 122.7
Administered Assets 31.2
-----
Total $289.5
=====
Market Appreciation (Depreciation)
During the Period:
Owned Assets:
Separate Account Assets $2,332
Other Owned Assets $(120)
Total Managed Assets $7,020
Cash Sales:
Mutual Funds $12,104
Annuities 1,362
Investment Certificates 835
Life and Other Insurance Products 237
Institutional 1,551
Other 573
------
Total Cash Sales $16,662
======
Number of Financial Advisors 11,094
Fees from Financial Plans and Advice Services $26.3
Percentage of Total Sales from Financial Plans
and Advice Services 66.9 %
</TABLE>
<TABLE>
<CAPTION>
Quarters Ended
December 31,
1999
----
<S> <C>
Investments (billions) $30.3
Client Contract Reserves (billions) $31.0
Shareholder's Equity (billions) $3.9
Return on Average Equity* 22.9 %
Life Insurance in Force (billions) $89.2
Assets Owned, Managed or
Administered (billions):
Assets Managed for Institutions $55.5
Assets Owned, Managed or Administered
for Individuals:
Owned Assets:
Separate Account Assets 35.9
Other Owned Assets 38.7
-----
Total Owned Assets 74.6
Managed Assets 115.1
Administered Assets 24.8
-----
Total $270.0
=====
Market Appreciation (Depreciation)
During the Period:
Owned Assets:
Separate Account Assets $6,726
Other Owned Assets $(254)
Total Managed Assets $20,745
Cash Sales:
Mutual Funds $8,611
Annuities 939
Investment Certificates 993
Life and Other Insurance Products 224
Institutional 1,928
Other 870
------
Total Cash Sales $13,565
======
Number of Financial Advisors 11,366
Fees from Financial Plans and Advice Services $22.1
Percentage of Total Sales from Financial Plans
and Advice Services 67.4 %
</TABLE>
<TABLE>
<CAPTION>
Quarters Ended
September 30,
1999
----
<S> <C>
Investments (billions) $30.7
Client Contract Reserves (billions) $31.0
Shareholder's Equity (billions) $3.9
Return on Average Equity* 22.8 %
Life Insurance in Force (billions) $86.3
Assets Owned, Managed or
Administered (billions):
Assets Managed for Institutions $48.2
Assets Owned, Managed or Administered
for Individuals:
Owned Assets:
Separate Account Assets 28.9
Other Owned Assets 38.1
-----
Total Owned Assets 67.0
Managed Assets 99.5
Administered Assets 21.1
-----
Total $235.8
=====
Market Appreciation (Depreciation)
During the Period:
Owned Assets:
Separate Account Assets $(986)
Other Owned Assets $(273)
Total Managed Assets $(5,318)
Cash Sales:
Mutual Funds $8,304
Annuities 1,190
Investment Certificates 1,061
Life and Other Insurance Products 196
Institutional 909
Other 953
------
Total Cash Sales $12,613
======
Number of Financial Advisors 10,631
Fees from Financial Plans and Advice Services $22.3
Percentage of Total Sales from Financial Plans
and Advice Services 67.7 %
</TABLE>
<TABLE>
<CAPTION>
Quarters Ended
June 30,
1999
----
<S> <C>
Investments (billions) $30.7
Client Contract Reserves (billions) $30.8
Shareholder's Equity (billions) $4.0
Return on Average Equity* 22.8 %
Life Insurance in Force (billions) $84.6
Assets Owned, Managed or
Administered (billions):
Assets Managed for Institutions $49.8
Assets Owned, Managed or Administered
for Individuals:
Owned Assets:
Separate Account Assets 30.1
Other Owned Assets 37.8
-----
Total Owned Assets 67.9
Managed Assets 102.1
Administered Assets 20.8
-----
Total $240.6
=====
Market Appreciation (Depreciation)
During the Period:
Owned Assets:
Separate Account Assets $1,520
Other Owned Assets $(395)
Total Managed Assets $5,329
Cash Sales:
Mutual Funds $8,872
Annuities 980
Investment Certificates 835
Life and Other Insurance Products 169
Institutional 1,432
Other 805
------
Total Cash Sales $13,093
======
Number of Financial Advisors 10,489
Fees from Financial Plans and Advice Services $22.8
Percentage of Total Sales from Financial Plans
and Advice Services 65.2 %
</TABLE>
* Excluding the effect of SFAS No. 115.
Note: In the first quarter of 2000, reporting of data related to
cash sales and assets owned, managed and administered was
revised to better reflect AEFA's multiple sales channel
strategy and broadening of its product portfolio through
additional non-proprietary offerings.
<TABLE>
<CAPTION>
(Preliminary) American Express Bank/Travelers Cheque
--------------------------------------
Statements of Income
--------------------
(Unaudited)
(Dollars in millions)
Quarters Ended
June 30,
-------------- Percentage
2000 1999 Inc/(Dec)
---- ---- ---------
<S> <C> <C> <C>
Net Revenues:
Interest Income $183 $183 (0.1) %
Interest Expense 120 108 10.5
--- ---
Net Interest Income 63 75 (15.5)
TC Investment Income 98 86 13.6
Commissions and Fees 59 47 26.0
Foreign Exchange Income & Other Revenue 42 51 (18.1)
--- ---
Total Net Revenues 262 259 1.1
--- ---
Expenses:
Human Resources 84 85 (0.5)
Other Operating Expenses 159 150 5.4
Provision for Losses 15 18 (15.5)
--- ---
Total Expenses 258 253 1.9
--- ---
Pretax Income 4 6 (34.0)
Income Tax Benefit (36) (32) 13.4
-- --
Net Income $40 $38 6.0
== ==
</TABLE>
<TABLE>
<CAPTION>
(Preliminary) American Express Bank/Travelers Cheque
--------------------------------------
Selected Statistical Information
--------------------------------
(Unaudited)
(Dollars in billions, except where indicated)
Quarters Ended
June 30,
-------------- Percentage
2000 1999 Inc/(Dec)
---- ---- --------
<S> <C> <C> <C>
Selected Statistical Information
--------------------------------
Total Shareholder's Equity (millions) $956 $1,048 (8.8) %
Return on Average Common Equity * 17.6 % 18.5 % -
Return on Average Assets * 0.80 % 0.86 % -
American Express Bank:
Shareholder's Equity (millions) $707 $714 (1.0)
Total Loans $5.1 $5.2 (2.3)
Total Non-performing Loans (millions) $174 $210 (17.0)
Other Non-performing Assets (millions) $36 $55 (33.5)
Reserve for Credit Losses (millions)** $187 $249 (25.1)
Loan Loss Reserves as a % of Total
Loans 3.3 % 4.1 % -
Deposits $8.2 $8.0 2.1
Assets Managed / Administered *** $10.3 $7.0 47.4
Assets of Non-Consolidated Joint
Ventures $2.3 $2.2 8.0
Risk-Based Capital Ratios:
Tier 1 10.3 % 9.8 % -
Total 11.9 % 12.1 % -
Leverage Ratio 5.8 % 5.7 % -
Travelers Cheque:
Sales $6.7 $6.1 10.6
Average Outstanding $6.5 $6.1 7.3
Average Investments $6.2 $5.7 7.4
Tax Equivalent Yield 8.9 % 8.8 % -
</TABLE>
* Excludes the effect of SFAS No. 115 for all periods presented.
** Allocation:
Loans $166 $216
Other Assets, primarily derivatives 16 32
Other Liabilities 5 1
--- ---
Total Credit Loss Reserves $187 $249
=== ===
*** Includes assets managed by American Express Financial Advisors.
<TABLE>
<CAPTION>
(Preliminary) American Express Bank/Travelers Cheque
--------------------------------------
Statements of Income
--------------------
(Unaudited)
(Dollars in millions)
Quarters Ended
June 30,
2000
----
<S> <C>
Net Revenues:
Interest Income $183
Interest Expense 120
---
Net Interest Income 63
TC Investment Income 98
Commissions and Fees 59
Foreign Exchange Income & Other Revenue 42
---
Total Net Revenues 262
---
Expenses:
Human Resources 84
Other Operating Expenses 159
Provision for Losses 15
---
Total Expenses 258
---
Pretax Income 4
Income Tax Benefit (36)
--
Net Income $40
==
</TABLE>
<TABLE>
<CAPTION>
Quarters Ended
March 31,
2000
----
<S> <C>
Net Revenues:
Interest Income $183
Interest Expense 118
---
Net Interest Income 65
TC Investment Income 91
Commissions and Fees 54
Foreign Exchange Income & Other Revenue 41
---
Total Net Revenues 251
---
Expenses:
Human Resources 84
Other Operating Expenses 148
Provision for Losses 16
---
Total Expenses 248
---
Pretax Income 3
Income Tax Benefit (37)
--
Net Income $40
==
</TABLE>
<TABLE>
<CAPTION>
Quarters Ended
December 31,
1999
----
<S> <C>
Net Revenues:
Interest Income $180
Interest Expense 112
---
Net Interest Income 68
TC Investment Income 88
Commissions and Fees 51
Foreign Exchange Income & Other Revenue 45
---
Total Net Revenues 252
---
Expenses:
Human Resources 90
Other Operating Expenses 151
Provision for Losses 11
---
Total Expenses 252
---
Pretax Income -
Income Tax Benefit (35)
--
Net Income $35
==
</TABLE>
<TABLE>
<CAPTION>
Quarters Ended
September 30,
1999
----
<S> <C>
Net Revenues:
Interest Income $181
Interest Expense 106
---
Net Interest Income 75
TC Investment Income 91
Commissions and Fees 49
Foreign Exchange Income & Other Revenue 46
---
Total Net Revenues 261
---
Expenses:
Human Resources 86
Other Operating Expenses 159
Provision for Losses 12
---
Total Expenses 257
---
Pretax Income 4
Income Tax Benefit (34)
--
Net Income $38
==
</TABLE>
<TABLE>
<CAPTION>
Quarters Ended
June 30,
1999
----
<S> <C>
Net Revenues:
Interest Income $183
Interest Expense 108
---
Net Interest Income 75
TC Investment Income 86
Commissions and Fees 47
Foreign Exchange Income & Other Revenue 51
---
Total Net Revenues 259
---
Expenses:
Human Resources 85
Other Operating Expenses 150
Provision for Losses 18
---
Total Expenses 253
---
Pretax Income 6
Income Tax Benefit (32)
--
Net Income $38
==
</TABLE>
<TABLE>
<CAPTION>
(Preliminary) American Express Bank/Travelers Cheque
--------------------------------------
Selected Statistical Information
--------------------------------
(Unaudited)
(Dollars in billions, except where indicated)
Quarters Ended
June 30,
2000
----
<S> <C>
Selected Statistical Information
--------------------------------
Total Shareholder's Equity (millions) $956
Return on Average Common Equity * 17.6 %
Return on Average Assets * 0.80 %
American Express Bank:
Shareholder's Equity (millions) $707
Total Loans $5.1
Total Non-performing Loans (millions) $174
Other Non-performing Assets (millions) $36
Reserve for Credit Losses (millions)** $187
Loan Loss Reserves as a % of Total Loans 3.3 %
Deposits $8.2
Assets Managed / Administered *** $10.3
Assets of Non-Consolidated Joint
Ventures $2.3
Risk-Based Capital Ratios:
Tier 1 10.3 %
Total 11.9 %
Leverage Ratio 5.8 %
Travelers Cheque:
Sales $6.7
Average Outstanding $6.5
Average Investments $6.2
Tax Equivalent Yield 8.9 %
</TABLE>
<TABLE>
<CAPTION>
Quarters Ended
March 31,
2000
----
<S> <C>
Selected Statistical Information
--------------------------------
Total Shareholder's Equity (millions) $943
Return on Average Common Equity * 17.3 %
Return on Average Assets * 0.81 %
American Express Bank:
Shareholder's Equity (millions) $697
Total Loans $5.0
Total Non-performing Loans (millions) $174
Other Non-performing Assets (millions) $31
Reserve for Credit Losses (millions)** $189
Loan Loss Reserves as a % of Total Loans 3.4 %
Deposits $8.4
Assets Managed / Administered *** $9.4
Assets of Non-Consolidated Joint
Ventures $2.4
Risk-Based Capital Ratios:
Tier 1 10.1 %
Total 11.6 %
Leverage Ratio 5.6 %
Travelers Cheque:
Sales $5.1
Average Outstanding $6.1
Average Investments $6.0
Tax Equivalent Yield 8.9 %
</TABLE>
<TABLE>
<CAPTION>
Quarters Ended
December 31,
1999
----
<S> <C>
Selected Statistical Information
--------------------------------
Total Shareholder's Equity (millions) $875
Return on Average Common Equity * 17.5 %
Return on Average Assets * 0.82 %
American Express Bank:
Shareholder's Equity (millions) $691
Total Loans $5.1
Total Non-performing Loans (millions) $168
Other Non-performing Assets (millions) $37
Reserve for Credit Losses (millions)** $189
Loan Loss Reserves as a % of Total Loans 3.3 %
Deposits $8.3
Assets Managed / Administered *** $8.6
Assets of Non-Consolidated Joint
Ventures $2.2
Risk-Based Capital Ratios:
Tier 1 9.9 %
Total 12.0 %
Leverage Ratio 5.6 %
Travelers Cheque:
Sales $5.4
Average Outstanding $6.1
Average Investments $5.9
Tax Equivalent Yield 8.8 %
</TABLE>
<TABLE>
<CAPTION>
Quarters Ended
September 30,
1999
----
<S> <C>
Selected Statistical Information
--------------------------------
Total Shareholder's Equity (millions) $956
Return on Average Common Equity * 17.7 %
Return on Average Assets * 0.83 %
American Express Bank:
Shareholder's Equity (millions) $702
Total Loans $5.1
Total Non-performing Loans (millions) $181
Other Non-performing Assets (millions) $40
Reserve for Credit Losses (millions)** $204
Loan Loss Reserves as a % of Total Loans 3.5 %
Deposits $8.1
Assets Managed / Administered *** $7.7
Assets of Non-Consolidated Joint
Ventures $2.4
Risk-Based Capital Ratios:
Tier 1 9.9 %
Total 12.1 %
Leverage Ratio 5.5 %
Travelers Cheque:
Sales $7.3
Average Outstanding $6.5
Average Investments $6.2
Tax Equivalent Yield 8.8 %
</TABLE>
<TABLE>
<CAPTION>
Quarters Ended
June 30,
1999
----
<S> <C>
Selected Statistical Information
--------------------------------
Total Shareholder's Equity (millions) $1,048
Return on Average Common Equity * 18.5 %
Return on Average Assets * 0.86 %
American Express Bank:
Shareholder's Equity (millions) $714
Total Loans $5.2
Total Non-performing Loans (millions) $210
Other Non-performing Assets (millions) $55
Reserve for Credit Losses (millions)** $249
Loan Loss Reserves as a % of Total Loans 4.1 %
Deposits $8.0
Assets Managed/Administered*** $7.0
Assets of Non-Consolidated Joint
Ventures $2.2
Risk-Based Capital Ratios:
Tier 1 9.8 %
Total 12.1 %
Leverage Ratio 5.7 %
Travelers Cheque:
Sales $6.1
Average Outstanding $6.1
Average Investments $5.7
Tax Equivalent Yield 8.8 %
</TABLE>
* Excludes the effect of SFAS No. 115 for all periods presented.
Quarters Ended
-------------
06/00 03/00 12/99 09/99 06/99
** Allocations: ----- ----- ----- ----- -----
Loans $166 $170 $169 $179 $216
Other Assets,
primarily derivatives 16 15 16 23 32
Other Liabilities 5 4 4 2 1
--- --- --- --- ---
Total Credit Loss
Reserves $187 $189 $189 $204 $249
=== === === === ===
***Includes assets managed by American Express Financial Advisors.
<TABLE>
<CAPTION>
American Express Bank
---------------------
Exposures By Country and Region
-------------------------------
(Unaudited)
($ in billions)
Net
Guarantees
FX and and 6/30/00 3/31/00
Deriva- Contin- Total Total
Country Loans tives gents Other* Exposure** Exposure**
------------- ----- ------ ------- ----- -------- --------
<S> <C> <C> <C> <C> C> <C>
Hong Kong $0.5 - $0.1 $0.1 $0.6 $0.7
Indonesia 0.1 - 0.1 0.1 0.3 0.3
Singapore 0.5 - 0.1 0.1 0.6 0.7
Korea 0.2 - - 0.3 0.5 0.4
Taiwan 0.2 - - 0.1 0.4 0.4
China - - - - - -
Japan - - - - 0.1 0.1
Thailand - - - - - -
Other 0.1 - - 0.1 0.2 0.3
--- --- --- --- --- ----
Total Asia/Pacific
Region** 1.6 - 0.4 0.7 2.7 2.9
--- --- --- --- --- ----
Chile 0.2 - - 0.1 0.4 0.4
Brazil 0.2 - - 0.1 0.3 0.3
Mexico 0.1 - - - 0.1 0.1
Peru - - - - - -
Argentina 0.1 - - - 0.1 0.1
Other 0.2 - 0.2 0.1 0.5 0.5
--- --- --- --- --- ----
Total Latin
America** 0.9 - 0.2 0.3 1.4 1.3
--- --- --- --- --- ----
India 0.3 - 0.1 0.3 0.7 0.7
Pakistan 0.1 - - 0.2 0.3 0.3
Other 0.1 - 0.1 0.1 0.2 0.2
--- --- --- --- --- ----
Total Sub-
continent** 0.5 - 0.2 0.6 1.2 1.2
--- --- --- --- --- ----
Egypt 0.3 - - 0.2 0.5 0.5
Other 0.1 - - - 0.2 0.2
--- --- --- --- --- ----
Total Middle East
& Africa** 0.4 - 0.1 0.2 0.7 0.8
--- --- --- --- --- ----
Total Europe*** 1.4 0.1 0.5 2.3 4.4 4.7
Total North
America** 0.3 0.1 0.2 1.3 1.8 1.8
--- --- --- --- --- ----
Total Worldwide** $5.1 $0.2 $1.5 $5.4 $12.3 $12.7
=== === === === ==== ====
</TABLE>
* Includes cash, placements and securities.
** Individual items may not add to totals due to rounding.
*** Total exposures at 6/30/00 and 3/31/00 include
$5 million and $10 million of exposures to Russia,
respectively.
Note: Includes cross-border and local exposure and does not net
local funding or liabilities against any local exposure.
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