EXHIBIT 99.1
FINANCIAL COMMUNITY PRESENTATION
AUGUST 2, 2000
DEPTH OF AMERICAN EXPRESS PRODUCTS AND SERVICES
We believe we are:
o The #1 card issuer in the world based on the volumes generated by our 49
million cards;
o The #1 Consumer Charge Card in the world;
o The 6th largest card lender in the U.S., based on outstandings, and the
2nd fastest growing portfolio over the last 5 quarters.
o The #3 U.S. airline card (Delta SkyMiles card), and on a global basis,
the #1 airline card issuer based on number of partners. SkyMiles is part of
a portfolio of airline co-brands -- 10 products in 7 countries - with two
more expected to be announced by year-end.
o The #1 Small Business Card, with over 2.5 million small business
relationships in the U.S.;
o The #6 U.S. small business lender for smaller size loans based on
outstandings;
o The #1 Corporate Card issuer, based on volume, with almost 70% of the
Fortune 1000 using our card or travel services;
o The #3 U.S. Purchase Card, based on total corporate volume.
o The worlds largest travel agency -- #1 in both business travel and consumer
travel based on sales, with our next leading competitor smaller by half;
o The largest seller of Travelers Cheques with annual sales of $23 billion in
1999, which represents about 70% of worldwide sales;
o The largest U.S. merchant acquirer based on volume;
o The 2nd largest ATM provider in the U.S., based on our almost 9,000
owned machines;
o The #1 financial planning company in the U.S., with more Certified Financial
Planners than any other company;
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o The #10 accounting firm in the U.S. based on revenues;
o The #6 U.S. online brokerage firm based on accounts;
o The 11th largest U.S. mutual fund company based on assets under management;
o The 12th largest U.S. provider of annuities; and
o The 10th largest U.S. provider of 401(k) services.
In International markets -
o We believe we are the #1 issuer of cards outside the U.S. We currently issue
cards in 60 markets and 54 currencies.
o We have identified 25-30 markets around the world that are important to our
business.
o In our consumer card business we continue to grow spending in important
international markets. Our latest data shows that we grew volumes faster
than the competition in 18 out of our top 23 markets, with our relative
percentage up by more than 100 basis points year over year in Hong Kong,
Argentina, India, Thailand, the Netherlands, Sweden and Mexico.
o In Travel we believe we are #1, #2 or #3 in 20 of the top 23 markets, based
on sales volume.
o In Corporate Card we believe we are #1, #2 or #3 in all 23 markets, based on
charge volume.
o We offer financial services - banking, lending, and asset management -- in
36 countries around the world, the top 23 and beyond.
o Through our Global Network Services business we have card partnerships in a
total of 71 countries.
o Our Membership Rewards program has over 8 million enrollees in 31
markets. Our Membership Rewards partners include 50 of the world's
largest airlines (with 2 more expected to be announced before year end)
and over 1,800 other travel providers and retailers.
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ONLINE BUSINESSES
o American Express Online Services currently has 2.3 million customers
enrolled.
o The ability to redeem Membership Reward points online was launched in May
and by the end of last week over 500 million points had been redeemed.
o More and more cardmembers are making use of our pay by computer service.
While still relatively small in number, pay by computer is our fastest
growing remittance channel. We have processed almost 1.2 million
computer payments so far this year at a unit cost that is less than half
of our mailed remittances.
o Our website received over 2 million unique visitors in total during June.
o Against our competition we were the 3rd most visited card site, the 3rd
most visited financial services site, and the 3rd most visited travel
site according to the Nielsen NetRatings.
o While our international activities are not yet at the same level as the U.S.,
we do have 11 international online sites, each of which is continually
expanding its capabilities.
U.S. LENDING
o We have been broadening the acquisition channels we use for our lending
products, but need to push this further. Direct mail and telemarketing
are important channels for us, but we know that multiple letters and
phone calls to the same prospects will not produce the results we need.
Newer channels, such as inbound telemarketing, the partnerships we've
established with Costco and Fidelity, and the internet all offer
significant potential. These three channels, which didn't exist 2 to 3
years ago, are expected to bring in close to 2 million consumer cards for
us this year.
o Since the beginning of 1999, we have received 1.2 million applications
online and generated almost 500,000 cards. And relative to our other
acquisition channels, the costs of acquiring an online card are
approximately 1/3 those of other channels, making the internet a good
economic choice for us as we look to grow our portfolio.
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o Along with building through organic growth, we are trying to acquire
portfolios. While acquisitions will help build scale, they also would
help us to learn how to convert customers and integrate systems. We have
been slow on the portfolio acquisition front to date, but we do expect to
announce our first acquisition -- albeit a small one -- this quarter.
SMALL BUSINESS
o We believe our small business cards have approximately 2/3 of non-debit
plastic spending among small businesses, and we have grown our volume by
approximately 20% in each of the last 4 years.
o Our potential for small business within the U.S. is substantial, and we
believe an even larger opportunity exists for these products in the
international markets we serve. To date we have executed a fairly
standardized product based on our U.S. SBS product -- but in 2000 we have
focused on customizing this product at the market level -- and plan on
offering more lending options and leveraging some of our B2B partnerships
to provide unique online value for our cardmembers.
o Because of the relatively high growth and good margins in this business,
competitors are investing heavily, and we have lost some share as a
result.
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INTERNATIONAL REVOLVE PRODUCTS
o We now offer revolve products in 16 markets. Our lending efforts gained
momentum with the development and launch of the International Blue Card,
which is now offered in 13 markets after first being launched in Taiwan
in 1997. Our lending cards in force are achieving double digit growth,
while outstandings across international are growing at a rate of 40% per
year.
PREMIUM CARDS
o We have put special emphasis on our premium products. The Centurion Card
was first launched outside of the U.S. in the UK and we now have launched
the product in 2 additional markets -- Hong Kong and Germany
o While the Platinum Card was first launched in the U.S., these cards are now
offered in 22 markets.
o The success of our efforts is evidenced by the fact that 43% of our charge
card base have now upgraded to premium products.
MEXICO CONSUMER CARD BUSINESS
o Mexico has one of our more established consumer card businesses abroad and
is our largest market in Latin America.
o We have a mix of products in Mexico that is continually being updated,
including our recent co-branded product with AeroMexico. As a result of our
efforts over a number of years, we have built a 46% share, well above our
consumer card peers.
o We have an exceptional customer base in Mexico. Our average consumer card
spending is 10 times larger than the market average, and less than 3% of our
cardmembers are inactive. Our volumes are also helped by strong inbound
spending from almost 20 million international tourists, who generate almost
$8 billion of spending in Mexico.
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AUSTRALIA CARD BUSINESS
o Australia is our largest market in Asia, excluding Japan, and represents
an example of how both proprietary and network partner products can work
well in the same market.
o The market is very concentrated, with 4 large banks holding an 80% share.
Our share is in the mid double digits.
FINANCIAL PLANNING
o Over 40% of our financial clients do a plan with their financial
advisors, and a third of our new clients begin their relationship with us
through a financial plan.
o Our online position is growing. Our brokerage accounts have reached almost
500,000 since November.
o Through financial planning, the depth of relationship with clients deepens
3-fold compared with that of non-planning clients.
- Financial planning clients own 7.5 accounts on average, versus 2.6
accounts per client for those without plans.
- Clients with plans tend to own more insurance products than those
without,
- The retention of financial planning clients is almost 40% higher
than for those that simply buy products.
- Veteran advisors who do financial planning earn over twice as much
as those who do little or no financial planning. And higher advisor
success converts into better retention.
GLOBAL ASSET MANAGEMENT
o Online, our brokerage application in the U.S. has shown a strong capability
for gathering assets into the company, with over 50% of assets representing
net new money for AEFA.
o Internationally, our online plans are in progress, with capabilities in
several markets planned to be launched over the next 12 months.
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CORPORATE PRODUCTS
o Within the U.S. we have T&E relationships with 70% of the Fortune 1000,
and have purchasing card relationships with 17%. In any number of
countries around the world we are also leaders in this business -- #1 in
Australia, Hong Kong, France, the UK, Mexico, and Brazil, among others,
based on spending volumes.
o By developing applications such as American Express @ Work, which moves
our customer servicing capabilities online, we can reduce our processing
expenses for tasks such as adding new corporate cards to an account,
changing addresses, and providing MIS reports. Through the first 6 months
of 2000, for those companies on American Express @ Work,
- 13% of maintenance transactions were being done online rather than
by an American Express employee,
- and 14% of all MIS reports were being printed off the web instead
of being mailed out.
BUSINESS TRAVEL
o We are the largest corporate travel agency in the world, with over $16
billion in annual air sales. We estimate our share of this business to be
approximately 21%, with our next nearest competitor less than half of our
size. Our customer base is comprised of multi-national, multi-regional
and prominent local firms of varying size. The revenue yield per mile
that our passengers deliver to the airlines is twice the industry
average.
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TRAVELERS CHEQUES
o Travelers Cheque continues to be a consistent, profitable performer for the
company. It has a return on equity of over 50%.
o We are the established worldwide leader with a 70% share of sales and a
distribution network that includes 16,000 selling outlets.
IMPORTANT FACTORS REGARDING FORWARD-LOOKING STATEMENTS
This presentation contains certain forward-looking statements, which are
subject to risks and uncertainties and speak only as of the date on which they
are made. The words "plan", "expect", "anticipate", "optimistic", "intend",
"aim", "will" or similar expressions are intended to identify forward-looking
statements. Readers are cautioned not to place undue reliance on these
forward-looking statements, which speak only as of the date on which they are
made. We undertake no obligation to update publicly or revise any
forward-looking statements. Important factors that could cause actual results
to differ materially from these forward-looking statements, include, but are
not limited to, the following: The inability of American Express Company (the
"Company") to extend the value of the American Express brand to other card
distribution channels such as the internet and to effectively target and
market potential lending customers through telemarketing, the Costco and
Fidelity partnerships and the internet; the Company's inability to develop or
license advanced technology for its online products and services, which could
hasten business model obsolescence or cause disintermediation of the Company's
products or services; patent rights held by competitors or others, limiting or
restricting the Company's use of desired business technology or processes; the
Company's inability to integrate its Internet applications and make the online
experience more desirable, reliable and user friendly for customers and
clients; the Company's inability to leverage successfully its assets, such as
its brand, customer base, international presence, marketing and data base
management skills, in the Internet environment; the Company's inability to
gain appropriate regulatory authorizations and provide services that are
attractive to customers in different markets based on cost and design in
connection with its development of international online transaction
capabilities; the Company's inability to adjust to unforeseeable events that
require changes in the Company's Internet strategy or development plan; and
the Company's inability to acquire targeted card portfolios, which depends in
part on its ability to successfully bid against competitors and effectively
size and value such portfolios.
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