EX-99.2 EXHIBIT 4 financials99_2.txt EXHIBIT EXHIBIT 99.2 All information in the following tables is presented on a basis prepared in accordance with accounting principles generally accepted in the United States (GAAP), unless otherwise indicated. (Preliminary) AMERICAN EXPRESS COMPANY CONDENSED CONSOLIDATED STATEMENTS OF INCOME (Unaudited) (Millions)
Quarters Ended Nine Months Ended September 30, September 30, ------------------------ Percentage ----------------------- Percentage 2003 2002 Inc/(Dec) 2003 2002 Inc/(Dec) --------- --------- ---------- --------- --------- ---------- Revenues Discount revenue $ 2,221 $ 1,967 13.0 % $ 6,349 $ 5,809 9.3 % Interest and dividends, net 730 759 (3.8) 2,277 2,175 4.7 Management and distribution fees 603 551 9.5 1,692 1,757 (3.7) Cardmember lending net finance charge revenue 450 380 18.3 1,400 1,240 12.9 Net card fees 462 439 5.4 1,368 1,291 6.0 Travel commissions and fees 349 342 1.9 1,062 1,039 2.1 Other commissions and fees 514 490 5.1 1,490 1,423 4.8 Insurance and annuity revenues 345 303 13.9 1,000 901 11.0 Securitization income, net 327 298 9.6 968 883 9.7 Other 418 378 10.4 1,192 1,093 8.9 --------- --------- --------- --------- Total revenues 6,419 5,907 8.7 18,798 17,611 6.7 Expenses Human resources 1,559 1,414 10.3 4,625 4,346 6.4 Provision for losses and benefits 1,080 1,073 0.6 3,265 3,336 (2.2) Marketing, promotion, rewards and cardmember services 1,016 805 26.2 2,735 2,297 19.1 Interest 239 264 (9.7) 700 812 (13.8) Other operating expenses 1,463 1,394 5.0 4,318 4,070 6.1 Restructuring charges (2) (2) 32.3 (2) (21) 91.6 Disaster recovery charge - - - - (7) - --------- --------- --------- --------- Total expenses 5,355 4,948 8.2 15,641 14,833 5.4 --------- --------- --------- --------- Pretax income 1,064 959 11.0 3,157 2,778 13.7 Income tax provision 294 272 8.0 933 790 18.2 --------- --------- --------- --------- Net income $ 770 $ 687 12.1 % $ 2,224 $ 1,988 11.9 % ========= ========= ========= =========
Note: Certain prior period amounts have been reclassified to conform to current year presentation. 12 (Preliminary) AMERICAN EXPRESS COMPANY CONDENSED CONSOLIDATED BALANCE SHEETS (Unaudited) (Billions)
September 30, December 31, 2003 2002 ------------ ------------ Assets Cash and cash equivalents $ 6 $ 10 Accounts receivable 30 29 Investments 56 54 Loans 28 28 Separate account assets 28 22 Other assets 16 14 ------------ ------------ Total assets $ 164 $ 157 ============ ============ Liabilities and Shareholders' Equity Separate account liabilities $ 28 $ 22 Short-term debt 16 21 Long-term debt 19 16 Other liabilities 86 84 ------------ ------------ Total liabilities 149 143 ------------ ------------ Shareholders' Equity 15 14 ------------ ------------ Total liabilities and shareholders' equity $ 164 $ 157 ============ ============
Note: Certain prior period amounts have been reclassified to conform to current year presentation. 13 (Preliminary) AMERICAN EXPRESS COMPANY FINANCIAL SUMMARY (Unaudited) (Millions)
Quarters Ended Nine Months Ended September 30, September 30, --------------------- Percentage --------------------------- Percentage 2003 2002 Inc/(Dec) 2003 2002 Inc/(Dec) --------- --------- ---------- --------- --------- ---------- REVENUES (A) Travel Related Services $ 4,758 $ 4,395 8 % $ 13,978 $ 13,056 7 % American Express Financial Advisors 1,525 1,388 10 4,432 4,173 6 American Express Bank 199 199 - 596 557 7 --------- --------- --------- --------- 6,482 5,982 8 19,006 17,786 7 Corporate and other, including adjustments and eliminations (63) (75) 16 (208) (175) (19) --------- --------- --------- --------- CONSOLIDATED REVENUES $ 6,419 $ 5,907 9 % $ 18,798 $ 17,611 7 % ========= ========= ========= ========= PRETAX INCOME (LOSS) Travel Related Services $ 892 $ 798 12 % $ 2,687 $ 2,286 18 % American Express Financial Advisors 224 205 9 611 659 (7) American Express Bank 41 38 5 109 85 28 --------- --------- --------- --------- 1,157 1,041 11 3,407 3,030 12 Corporate and other (93) (82) (12) (250) (252) 1 --------- --------- --------- --------- PRETAX INCOME $ 1,064 $ 959 11 % $ 3,157 $ 2,778 14 % ========= ========= ========= ========= NET INCOME (LOSS) Travel Related Services $ 606 $ 553 10 % $ 1,824 $ 1,585 15 % American Express Financial Advisors 197 152 30 487 479 2 American Express Bank 27 25 5 73 56 29 --------- --------- --------- --------- 830 730 14 2,384 2,120 12 Corporate and other (60) (43) (39) (160) (132) (21) --------- --------- --------- --------- NET INCOME $ 770 $ 687 12 % $ 2,224 $ 1,988 12 % ========= ========= ========= =========
(A) Managed net revenues are reported net of American Express Financial Advisors' provision for losses and benefits and exclude the effect of TRS' securitization activities. The following table reconciles consolidated GAAP revenues to Managed Basis net revenues: GAAP revenues $ 6,419 $ 5,907 9 % $ 18,798 $ 17,611 7 % Effect of TRS securitizations 255 278 735 724 Effect of AEFA provisions (535) (487) (1,567) (1,415) --------- --------- --------- --------- Managed net revenues $ 6,139 $ 5,698 8 % $ 17,966 $ 16,920 6 % ========= ========= ========= =========
14 (Preliminary) AMERICAN EXPRESS COMPANY FINANCIAL SUMMARY (CONTINUED) (UNAUDITED)
Quarters Ended Nine Months Ended September 30, September 30, ------------------------ Percentage ----------------------- Percentage 2003 2002 Inc/(Dec) 2003 2002 Inc/(Dec) --------- --------- ---------- -------- -------- ---------- EARNINGS PER SHARE Per share net income: Basic $ 0.60 $ 0.52 15 % $ 1.73 $ 1.50 15 % ========= ========= ======== ======== Diluted $ 0.59 $ 0.52 13 % $ 1.71 $ 1.49 15 % ========= ========= ======== ======== Average common shares outstanding for earnings per common share (millions): Basic 1,278 1,323 (3)% 1,287 1,324 (3)% ========= ========= ======== ======== Diluted 1,297 1,330 (2)% 1,298 1,334 (3)% ========= ========= ======== ======== Cash dividends declared per common share $ 0.10 $ 0.08 25 % $ 0.28 $ 0.24 17 % ========= ========= ======== ========
SELECTED STATISTICAL INFORMATION (Unaudited)
Quarters Ended Nine Months Ended September 30, September 30, -------------------------- Percentage -------------------------- Percentage 2003 2002 Inc/(Dec) 2003 2002 Inc/(Dec) --------- --------- ----------- --------- --------- ----------- Return on average total shareholders' equity (A) 20.4 % 17.8 % - 20.4 % 17.8 % - Common shares outstanding (millions) 1,285 1,325 (3)% 1,285 1,325 (3)% Book value per common share $ 11.54 $ 10.55 9 % $ 11.54 $ 10.55 9 % Shareholders' equity (billions) $ 14.8 $ 14.0 6 % $ 14.8 $ 14.0 6 %
(A) Computed on a trailing 12-month basis using total shareholders' equity as reported in the Consolidated Financial Statements prepared in accordance with GAAP. All return on average total shareholders' equity and return on average total asset calculations in this and following tables are revised from amounts previously reported. 15 (Preliminary) AMERICAN EXPRESS COMPANY CONDENSED CONSOLIDATED STATEMENTS OF INCOME (Unaudited) (Millions)
Quarters Ended --------------------------------------------------------------------------- September 30, June 30, March 31, December 31, September 30, 2003 2003 2003 2002 2002 --------- --------- --------- --------- --------- Revenues Discount revenue $ 2,221 $ 2,152 $ 1,976 $ 2,122 $ 1,967 Interest and dividends, net 730 780 767 816 759 Management and distribution fees 603 569 520 528 551 Cardmember lending net finance charge revenue 450 442 508 430 380 Net card fees 462 455 451 435 439 Travel commissions and fees 349 373 340 369 342 Other commissions and fees 514 479 497 505 490 Insurance and annuity revenues 345 341 314 317 303 Securitization income, net 327 386 255 324 298 Other 418 379 395 350 378 --------- --------- --------- --------- --------- Total revenues 6,419 6,356 6,023 6,196 5,907 Expenses Human resources 1,559 1,576 1,490 1,379 1,414 Provision for losses and benefits 1,080 1,075 1,110 1,250 1,073 Marketing, promotion, rewards and cardmember services 1,016 944 775 822 805 Interest 239 231 230 270 264 Other operating expenses 1,463 1,433 1,422 1,512 1,394 Restructuring charges (2) - - 14 (2) --------- --------- --------- --------- --------- Total expenses 5,355 5,259 5,027 5,247 4,948 --------- --------- --------- --------- --------- Pretax income 1,064 1,097 996 949 959 Income tax provision 294 335 304 266 272 --------- --------- --------- --------- --------- Net income $ 770 $ 762 $ 692 $ 683 $ 687 ========= ========= ========= ========= =========
Note: Certain prior period amounts have been reclassified to conform to current year presentation. 16 (Preliminary) AMERICAN EXPRESS COMPANY FINANCIAL SUMMARY (Unaudited) (Millions)
Quarters Ended ----------------------------------------------------------------------------- September 30, June 30, March 31, December 31, September 30, 2003 2003 2003 2002 2002 ---------- ---------- ---------- ---------- ---------- REVENUES (A) Travel Related Services $ 4,758 $ 4,734 $ 4,486 $ 4,665 $ 4,395 American Express Financial Advisors 1,525 1,496 1,411 1,444 1,388 American Express Bank 199 200 197 188 199 ---------- ---------- ---------- ---------- ---------- 6,482 6,430 6,094 6,297 5,982 Corporate and other, including adjustments and eliminations (63) (74) (71) (101) (75) ---------- ---------- ---------- ---------- ---------- CONSOLIDATED REVENUES $ 6,419 $ 6,356 $ 6,023 $ 6,196 $ 5,907 ========== ========== ========== ========== ========== PRETAX INCOME (LOSS) Travel Related Services $ 892 $ 937 $ 858 $ 794 $ 798 American Express Financial Advisors 224 209 178 206 205 American Express Bank 41 39 29 36 38 ---------- ---------- ---------- ---------- ---------- 1,157 1,185 1,065 1,036 1,041 Corporate and other (93) (88) (69) (87) (82) ---------- ---------- ---------- ---------- ---------- PRETAX INCOME $ 1,064 $ 1,097 $ 996 $ 949 $ 959 ========== ========== ========== ========== ========== NET INCOME (LOSS) Travel Related Services $ 606 $ 634 $ 584 $ 550 $ 553 American Express Financial Advisors 197 157 133 153 152 American Express Bank 27 27 19 24 25 ---------- ---------- ---------- ---------- ---------- 830 818 736 727 730 Corporate and other (60) (56) (44) (44) (43) ---------- ---------- ---------- ---------- ---------- NET INCOME $ 770 $ 762 $ 692 $ 683 $ 687 ========== ========== ========== ========== ==========
(A) Managed net revenues are reported net of American Express Financial Advisors' provision for losses and benefits and exclude the effect of TRS' securitization activities. The following table reconciles consolidated GAAP revenues to Managed Basis net revenues: GAAP revenues $ 6,419 $ 6,356 $ 6,023 $ 6,196 $ 5,907 Effect of TRS securitizations 255 216 264 224 278 Effect of AEFA provisions (535) (526) (506) (539) (487) ---------- ---------- ---------- ---------- ---------- Managed net revenues $ 6,139 $ 6,046 $ 5,781 $ 5,881 $ 5,698 ========== ========== ========== ========== ==========
17 (Preliminary) AMERICAN EXPRESS COMPANY FINANCIAL SUMMARY (CONTINUED) (Unaudited)
Quarters Ended ----------------------------------------------------------------------------- September 30, June 30, March 31, December 31, September 30, 2003 2003 2003 2002 2002 ------------ ------------ ------------ ------------ ------------- EARNINGS PER SHARE Per share net income: Basic $ 0.60 $ 0.59 $ 0.53 $ 0.52 $ 0.52 ============ =========== ============ ============ ============ Diluted $ 0.59 $ 0.59 $ 0.53 $ 0.52 $ 0.52 ============ =========== ============ ============ ============ Average common shares outstanding for earnings per common share (millions): Basic 1,278 1,283 1,297 1,309 1,323 ============ =========== ============ ============ ============ Diluted 1,297 1,295 1,305 1,317 1,330 ============ =========== ============ ============ ============ Cash dividends declared per common share $ 0.10 $ 0.10 $ 0.08 $ 0.08 $ 0.08 ============ =========== ============ ============ ============
SELECTED STATISTICAL INFORMATION (Unaudited)
Quarters Ended ----------------------------------------------------------------------------- September 30, June 30, March 31, December 31, September 30, 2003 2003 2003 2002 2002 ------------ ------------ ------------ ------------ ------------- Return on average total shareholders' equity (A) 20.4% 20.1% 20.0% 20.2% 17.8% Common shares outstanding (millions) 1,285 1,286 1,298 1,305 1,325 Book value per common share $ 11.54 $ 11.27 $ 10.84 $ 10.63 $ 10.55 Shareholders' equity (billions) $ 14.8 $ 14.5 $ 14.1 $ 13.9 $ 14.0
(A) Computed on a trailing 12-month basis using total shareholders' equity as reported in the Consolidated Financial Statements prepared in accordance with GAAP. 18 (Preliminary) TRAVEL RELATED SERVICES STATEMENTS OF INCOME (Unaudited) (Millions)
Quarters Ended September 30, ----------------------- Percentage 2003 2002 Inc/(Dec) --------- --------- ---------- Net revenues: Discount revenue $ 2,221 $ 1,967 13.0 % Net card fees 462 439 5.4 Lending: Finance charge revenue 566 504 12.0 Interest expense 116 124 (7.3) --------- --------- Net finance charge revenue 450 380 18.3 Travel commissions and fees 349 342 1.9 Other commissions and fees 465 467 (0.4) Travelers Cheque investment income 90 96 (7.0) Securitization income, net 327 298 9.6 Other revenues 394 406 (3.0) --------- --------- Total net revenues 4,758 4,395 8.2 --------- --------- Expenses: Marketing, promotion, rewards and cardmember services 994 796 24.8 Provision for losses and claims: Charge card 213 191 11.1 Lending 279 319 (12.6) Other 31 38 (17.8) --------- --------- Total 523 548 (4.7) Charge card interest expense 186 249 (25.3) Human resources 938 871 7.6 Other operating expenses 1,225 1,133 8.3 --------- --------- Total expenses 3,866 3,597 7.5 --------- --------- Pretax income 892 798 11.7 Income tax provision 286 245 16.3 --------- --------- Net income $ 606 $ 553 9.7 % ========= =========
Note: Certain prior period amounts have been reclassified to conform to current year presentation. 19 (Preliminary) TRAVEL RELATED SERVICES SELECTED FINANCIAL INFORMATION (Unaudited) Quarters Ended September 30, (Millions)
GAAP Basis Securitization Effect Managed Basis ------------------- Percentage --------------------- ------------------- Percentage 2003 2002 Inc/(Dec) 2003 2002 2003 2002 Inc/(Dec) ------- ------- ---------- ------- -------- ------- ------- ---------- Net revenues: Discount revenue $ 2,221 $ 1,967 13.0 % Net card fees 462 439 5.4 Lending: Finance charge revenue 566 504 12.0 $ 611 $ 630 $ 1,177 $ 1,134 3.7 % Interest expense 116 124 (7.3) 74 98 190 222 (15.1) ------- ------- ------- ------- ------- ------- Net finance charge revenue 450 380 18.3 537 532 987 912 8.2 Travel commissions and fees 349 342 1.9 Other commissions and fees 465 467 (0.4) 45 48 510 515 (0.9) Travelers Cheque investment income 90 96 (7.0) Securitization income, net 327 298 9.6 (327) (298) - - - Other revenues 394 406 (3.0) - (4) 394 402 (2.1) ------- ------- ------- ------- ------- ------- Total net revenues 4,758 4,395 8.2 255 278 5,013 4,673 7.3 ------- ------- ------- ------- ------- ------- Expenses: Marketing, promotion, rewards and cardmember services 994 796 24.8 - (5) 994 791 25.6 Provision for losses and claims: Charge card 213 191 11.1 Lending 279 319 (12.6) 255 291 534 610 (12.3) Other 31 38 (17.8) ------- ------- ------- ------- ------- ------- Total 523 548 (4.7) 255 291 778 839 (7.2) ------- ------- Charge card interest expense 186 249 (25.3) - (4) 186 245 (24.2) Human resources 938 871 7.6 Other operating expenses 1,225 1,133 8.3 - (4) 1,225 1,129 8.6 ------- ------- ------- ------- ------- ------- Total expenses 3,866 3,597 7.5 $ 255 $ 278 $ 4,121 $ 3,875 6.4 ------- ------- ------- ------- ------- ------- Pretax income 892 798 11.7 Income tax provision 286 245 16.3 ------- ------- Net income $ 606 $ 553 9.7 % ======= =======
Note: Certain prior period amounts have been reclassified to conform to current year presentation. Securitization income, net represents revenue related to the Company's securitized loan receivables, which includes gains recorded at the time of securitization, net finance charge revenue on retained interests in securitized loans and servicing income net of related discounts. Management views the gains from securitizations as discretionary benefits to be used for card acquisition expenses, which are reflected in marketing, promotion, rewards and cardmember services expenses and other operating expenses. Consequently, the above managed Selected Financial Information for the quarter ended September 30, 2002 assumes that net gains of $9 million from lending securitizations were offset by higher marketing, promotion, rewards and cardmember services expenses of $5 million and other operating expenses of $4 million. Accordingly, the incremental expenses, as well as the gains, have been eliminated. 20 (Preliminary) TRAVEL RELATED SERVICES SELECTED FINANCIAL INFORMATION (Unaudited) Quarters Ended (Millions)
GAAP Basis Securitization Effect Managed Basis ------------------------------ ------------------------------ ------------------------------ June 30, March 31, December 31, June 30, March 31, December 31, June 30, March 31, December 31, 2003 2003 2002 2003 2003 2002 2003 2003 2002 ------- -------- ----------- ------- -------- ----------- ------- -------- ----------- Net revenues: Discount revenue $ 2,152 $ 1,976 $ 2,122 Net card fees 455 451 435 Lending: Finance charge revenue 557 637 562 $ 607 $ 533 $ 593 $ 1,164 $ 1,170 $ 1,155 Interest expense 115 129 132 50 64 89 165 193 221 ------- ------- ------- ------- ------- ------- ------- ------- ------- Net finance charge revenue 442 508 430 557 469 504 999 977 934 Travel commissions and fees 373 340 369 Other commissions and fees 457 464 476 45 50 48 502 514 524 Travelers Cheque investment income 92 92 94 Securitization income, net 386 255 324 (386) (255) (324) - - - Other revenues 377 400 415 - - (4) 377 400 411 ------- ------- ------- ------- ------- ------- ------- ------- ------- Total net revenues 4,734 4,486 4,665 216 264 224 4,950 4,750 4,889 ------- ------- ------- ------- ------- ------- ------- ------- ------- Expenses: Marketing, promotion, rewards and cardmember services 918 761 796 (48) (26) - 870 735 796 Provision for losses and claims: Charge card 205 208 237 Lending 278 331 414 297 307 227 575 638 641 Other 37 31 26 ------- ------- ------- ------- ------- ------- ------- ------- ------- Total 520 570 677 297 307 227 817 877 904 Charge card interest expense 204 209 252 - - (3) 204 209 249 Human resources 965 916 852 Other operating expenses 1,190 1,172 1,279 (33) (17) - 1,157 1,155 1,279 Restructuring charges - - 15 ------- ------- ------- ------- ------- ------- ------- ------- ------- Total expenses 3,797 3,628 3,871 $ 216 $ 264 $ 224 $ 4,013 $ 3,892 $ 4,095 ------- ------- ------- ------- ------- ------- ------- ------- ------- Pretax income 937 858 794 Income tax provision 303 274 244 ------- ------- ------- Net income $ 634 $ 584 $ 550 ======= ======= =======
Note: Certain prior period amounts have been reclassified to conform to current year presentation. Securitization income, net represents revenue related to the Company's securitized loan receivables, which includes gains recorded at the time of securitization, net finance charge revenue on retained interests in securitized loans and servicing income net of related discounts. Management views the gains from securitizations as discretionary benefits to be used for card acquisition expenses, which are reflected in marketing, promotion, rewards and cardmember services expenses and other operating expenses. Consequently, the above managed Selected Financial Information for the quarters ended June 30, 2003 and March 31, 2003 assume that net gains of $81 million and $43 million, respectively, from lending securitizations were offset by higher marketing, promotion, rewards and cardmember services expenses of $48 million and $26 million, respectively, and other operating expenses of $33 million and $17 million, respectively. Accordingly, the incremental expenses, as well as the gains, have been eliminated. 21 (Preliminary) TRAVEL RELATED SERVICES SELECTED STATISTICAL INFORMATION (Unaudited) (Billions, except percentages and where indicated)
Quarters Ended September 30, ------------------------- Percentage 2003 2002 Inc/(Dec) ---------- ---------- ---------- Total cards-in-force (millions): United States 36.2 34.8 3.8 % Outside the United States 23.4 21.6 8.6 ---------- ---------- Total 59.6 56.4 5.6 % ========== ========== Basic cards-in-force (millions): United States 27.3 26.7 2.0 % Outside the United States 19.3 17.8 8.6 ---------- ---------- Total 46.6 44.5 4.7 % ========== ========== Card billed business United States $ 66.3 $ 58.2 14.0 % Outside the United States 22.5 19.4 16.0 ---------- ---------- Total $ 88.8 $ 77.6 14.5 % ========== ========== Average discount rate (A) 2.60 % 2.63 % - Average basic cardmember spending (dollars) (A) $ 2,101 $ 1,906 10.2 % Average fee per card (dollars) (A) $ 35 $ 34 2.9 % Non-Amex brand (B): Cards-in-force (millions) 0.7 0.7 7.8 % Billed business $ 1.0 $ 0.9 12.1 % Travel sales $ 3.7 $ 3.7 2.0 % Travel commissions and fees/sales (C) 9.3 % 9.3 % - Travelers Cheque: Sales $ 6.0 $ 6.9 (13.2)% Average outstanding $ 7.0 $ 7.0 0.1 % Average investments $ 7.4 $ 7.3 1.3 % Investment yield 5.2 % 5.5 % - Tax equivalent yield 8.0 % 8.4 % - Total debt $ 33.3 $ 33.2 0.3 % Shareholder's equity $ 8.0 $ 7.4 9.0 % Return on average total shareholder's equity (D) 31.2 % 25.4 % - Return on average total assets (E) 3.4 % 2.6 % -
(A) Cards-in-force include proprietary cards and cards issued under network partnership agreements outside the U.S. Average discount rate, average basic cardmember spending and average fee per card are computed from proprietary card activities only. (B) These data relate to Visa and Eurocards issued in connection with joint venture activities. (C) Computed from information provided herein. (D) Computed on a trailing 12-month basis using total shareholder's equity as reported in the Consolidated Financial Statements prepared in accordance with GAAP. (E) Computed on a trailing 12-month basis using total assets as reported in the Consolidated Financial Statements prepared in accordance with GAAP. 22 (Preliminary) TRAVEL RELATED SERVICES SELECTED STATISTICAL INFORMATION (CONTINUED) (Unaudited) (Billions, except percentages and where indicated)
Quarters Ended September 30, ------------------------- Percentage 2003 2002 Inc/(Dec) ---------- ---------- ---------- Charge card receivables: Total receivables $ 26.4 $ 24.1 9.3 % 90 days past due as a % of total 2.0 % 2.4 % - Loss reserves (millions) $ 921 $ 934 (A) (1.4)% % of receivables 3.5 % 3.9 % - % of 90 days past due 174 % 161 % - Net loss ratio 0.28 % 0.40 % - U.S. Lending (Owned Basis): Total loans $ 16.4 $ 14.9 9.7 % Past due loans as a % of total: 30-89 days 1.7 % 2.0 % - 90+ days 1.0 % 1.2 % - Loss reserves (millions): Beginning balance $ 773 $ 627 23.2 % Provision 174 217 (19.3) Net charge-offs (201) (196) 2.1 Other 13 21 (41.6) ---------- ---------- Ending balance $ 759 $ 669 13.6 % ========== ========== % of loans 4.6 % 4.5 % - % of past due 169 % 139 % - Average loans $ 16.4 $ 14.2 16.0 % Net write-off rate 4.9 % 5.5 % - Net interest yield 6.9 % 7.3 % - U.S. Lending - Managed Basis: Total loans $ 35.9 $ 32.2 11.5 % Past due loans as a % of total: 30-89 days 1.8 % 2.0 % - 90+ days 1.0 % 1.2 % - Loss reserves (millions): Beginning balance $ 1,350 $ 1,121 20.4 % Provision 431 507 (15.1) Net charge-offs (454) (456) (A) (0.8) Other 13 21 (A) (41.6) ---------- ---------- Ending balance $ 1,340 $ 1,193 (A) 12.3 % ========== ========== % of loans 3.7 % 3.7 % - % of past due 133 % 118 %(A) - Average loans $ 36.0 $ 32.2 11.8 % Net write-off rate 5.0 % 5.7 %(A) - Net interest yield 8.9 % 9.7 % -
(A) Revised as per the 8-K filed with the SEC on December 16, 2002. 23 (Preliminary) TRAVEL RELATED SERVICES STATEMENTS OF INCOME (Unaudited) (Millions)
Quarters Ended ------------------------------------------------------------------------------------------ September 30, June 30, March 31, December 31, September 30, 2003 2003 2003 2002 2002 -------------- -------------- -------------- -------------- -------------- Net revenues: Discount revenue $ 2,221 $ 2,152 $ 1,976 $ 2,122 $ 1,967 Net card fees 462 455 451 435 439 Lending: Finance charge revenue 566 557 637 562 504 Interest expense 116 115 129 132 124 -------------- -------------- -------------- -------------- -------------- Net finance charge revenue 450 442 508 430 380 Travel commissions and fees 349 373 340 369 342 Other commissions and fees 465 457 464 476 467 Travelers Cheque investment income 90 92 92 94 96 Securitization income, net 327 386 255 324 298 Other revenues 394 377 400 415 406 -------------- -------------- -------------- -------------- -------------- Total net revenues 4,758 4,734 4,486 4,665 4,395 -------------- -------------- -------------- -------------- -------------- Expenses: Marketing, promotion, rewards and cardmember services 994 918 761 796 796 Provision for losses and claims: Charge card 213 205 208 237 191 Lending 279 278 331 414 319 Other 31 37 31 26 38 -------------- -------------- -------------- -------------- -------------- Total 523 520 570 677 548 Charge card interest expense 186 204 209 252 249 Human resources 938 965 916 852 871 Other operating expenses 1,225 1,190 1,172 1,279 1,133 Restructuring charges - - - 15 - -------------- -------------- -------------- -------------- -------------- Total expenses 3,866 3,797 3,628 3,871 3,597 -------------- -------------- -------------- -------------- -------------- Pretax income 892 937 858 794 798 Income tax provision 286 303 274 244 245 -------------- -------------- -------------- -------------- -------------- Net income $ 606 $ 634 $ 584 $ 550 $ 553 ============== ============== ============== ============== ==============
Note: Certain prior period amounts have been reclassified to conform to current year presentation. 24 (Preliminary) TRAVEL RELATED SERVICES SELECTED MANAGED BASIS INFORMATION (Unaudited) (Millions)
Quarters Ended ------------------------------------------------------------------------------------- September 30, June 30, March 31, December 31, September 30, 2003 2003 2003 2002 2002 ------------- ------------- ------------- ------------- ------------- Lending finance charge revenue $ 1,177 $ 1,164 $ 1,170 $ 1,155 $ 1,134 Lending interest expense 190 165 193 221 222 Other commissions and fees 510 502 514 524 515 Other revenues 394 377 400 411 402 Marketing, promotion, rewards and cardmember services 994 870 735 796 791 Lending provision 534 575 638 641 610 Charge card interest expense 186 204 209 249 245 Other operating expenses 1,225 1,157 1,155 1,279 1,129
Note: Certain prior period amounts have been reclassified to conform to current year presentation. See prior page for comparable GAAP measures. 25 (Preliminary) TRAVEL RELATED SERVICES SELECTED STATISTICAL INFORMATION (Unaudited) (Billions, except percentages and where indicated)
Quarters Ended --------------------------------------------------------------------------------- September 30, June 30, March 31, December 31, September 30, 2003 2003 2003 2002 2002 ------------- ------------- ------------- ------------- ------------- Total cards-in-force (millions): United States 36.2 35.7 35.4 35.1 34.8 Outside the United States 23.4 22.9 22.4 22.2 21.6 ------------- ------------- ------------- ------------- ------------- Total 59.6 58.6 57.8 57.3 56.4 ============= ============= ============= ============= ============= Basic cards-in-force (millions): United States 27.3 27.3 27.1 26.9 26.7 Outside the United States 19.3 18.9 18.5 18.3 17.8 ------------- ------------- ------------- ------------- ------------- Total 46.6 46.2 45.6 45.2 44.5 ============= ============= ============= ============= ============= Card billed business United States $ 66.3 $ 64.6 $ 58.9 $ 62.9 $ 58.2 Outside the United States 22.5 21.5 19.9 21.2 19.4 ------------- ------------- ------------- ------------- ------------- Total $ 88.8 $ 86.1 $ 78.8 $ 84.1 $ 77.6 ============= ============= ============= ============= ============= Average discount rate (A) 2.60 % 2.59 % 2.60 % 2.62 % 2.63 % Average basic cardmember spending (dollars) (A) $ 2,101 $ 2,054 $ 1,894 $ 2,050 $ 1,906 Average fee per card - managed (dollars) (A) $ 35 $ 34 $ 35 $ 34 $ 34 Non-Amex brand (B): Cards-in-force (millions) 0.7 0.7 0.7 0.7 0.7 Billed business $ 1.0 $ 1.0 $ 0.9 $ 1.0 $ 0.9 Travel sales $ 3.7 $ 3.9 $ 3.7 $ 3.8 $ 3.7 Travel commissions and fees/sales (C) 9.3 % 9.6 % 9.3 % 9.6 % 9.3 % Travelers Cheque: Sales $ 6.0 $ 4.4 $ 4.1 $ 4.8 $ 6.9 Average outstanding $ 7.0 $ 6.4 $ 6.5 $ 6.5 $ 7.0 Average investments $ 7.4 $ 6.9 $ 6.9 $ 6.8 $ 7.3 Investment yield 5.2 % 5.5 % 5.6 % 5.6 % 5.5 % Tax equivalent yield 8.0 % 8.4 % 8.6 % 8.7 % 8.4 % Total debt $ 33.3 $ 34.2 $ 34.1 $ 36.4 $ 33.2 Shareholder's equity $ 8.0 $ 7.8 $ 7.5 $ 7.3 $ 7.4 Return on average total shareholder's equity (D) 31.2 % 31.5 % 31.3 % 30.3 % 25.4 % Return on average total assets (E) 3.4 % 3.4 % 3.3 % 3.2 % 2.6 %
(A) Cards-in-force include proprietary cards and cards issued under network partnership agreements outside the U.S. Average discount rate, average basic cardmember spending and average fee per card are computed from proprietary card activities only. (B) These data relate to Visa and Eurocards issued in connection with joint venture activities. (C) Computed from information provided herein. (D) Computed on a trailing 12-month basis using total shareholder's equity as reported in the Consolidated Financial Statements prepared in accordance with GAAP. (E) Computed on a trailing 12-month basis using total assets as reported in the Consolidated Financial Statements prepared in accordance with GAAP. 26 (Preliminary) TRAVEL RELATED SERVICES SELECTED STATISTICAL INFORMATION (CONTINUED) (Unaudited) (Billions, except percentages and where indicated)
Quarters Ended --------------------------------------------------------------------------------- September 30, June 30, March 31, December 31, September 30, 2003 2003 2003 2002 2002 ------------- ------------- ------------- ------------- ------------- Charge card receivables: Total receivables $ 26.4 $ 26.0 $ 24.3 $ 26.3 $ 24.1 90 days past due as a % of total 2.0 % 2.1 % 2.4 % 2.2 % 2.4 % Loss reserves (millions) $ 921 $ 943 $ 923 $ 930 $ 934 (A) % of receivables 3.5 % 3.6 % 3.8 % 3.5 % 3.9 % % of 90 days past due 174 % 171 % 159 % 162 % 161 % Net loss ratio 0.28 % 0.29 % 0.28 % 0.32 % 0.40 % U.S. Lending (Owned Basis): Total loans $ 16.4 $ 16.5 $ 16.5 $ 17.1 $ 14.9 Past due loans as a % of total: 30-89 days 1.7 % 1.7 % 1.9 % 2.0 % 2.0 % 90+ days 1.0 % 1.1 % 1.2 % 1.3 % 1.2 % Loss reserves (millions): Beginning balance $ 773 $ 790 $ 798 $ 669 $ 627 Provision 174 165 200 318 217 Net charge-offs (201) (199) (225) (206) (196) Other 13 17 17 17 21 ------------- ------------- ------------- ------------- ------------- Ending balance $ 759 $ 773 $ 790 $ 798 $ 669 ============= ============= ============= ============= ============= % of loans 4.6 % 4.7 % 4.8 % 4.7 % 4.5 % % of past due 169 % 169 % 155 % 143 % 139 % Average loans $ 16.4 $ 16.1 $ 16.6 $ 15.7 $ 14.2 Net write-off rate 4.9 % 4.9 % 5.4 % 5.2 % 5.5 % Net interest yield 6.9 % 6.8 % 7.9 % 7.8 % 7.3 % U.S. Lending - Managed Basis: Total loans $ 35.9 $ 36.0 $ 34.6 $ 34.3 $ 32.2 Past due loans as a % of total: 30-89 days 1.8 % 1.7 % 1.9 % 1.9 % 2.0 % 90+ days 1.0 % 1.0 % 1.2 % 1.2 % 1.2 % Loss reserves (millions): Beginning balance $ 1,350 $ 1,347 $ 1,297 $ 1,193 $ 1,121 Provision 431 461 507 547 507 Net charge-offs (454) (475) (474) (460) (456)(A) Other 13 17 17 17 21 (A) ------------- ------------- ------------- ------------- ------------- Ending balance $ 1,340 $ 1,350 $ 1,347 $ 1,297 $ 1,193 (A) ============= ============= ============= ============= ============= % of loans 3.7 % 3.7 % 3.9 % 3.8 % 3.7 % % of past due 133 % 136 % 127 % 120 % 118 % (A) Average loans $ 36.0 $ 35.3 $ 34.2 $ 32.9 $ 32.2 Net write-off rate 5.0 % 5.4 % 5.5 % 5.5 % 5.7 % (A) Net interest yield 8.9 % 8.9 % 9.4 % 9.8 % 9.7 %
(A) Revised as per the 8-K filed with the SEC on December 16, 2002. 27 (Preliminary) AMERICAN EXPRESS FINANCIAL ADVISORS STATEMENTS OF INCOME (Unaudited) (Millions)
Quarters Ended September 30, ------------------------- Percentage 2003 2002 Inc/(Dec) ---------- ---------- ---------- Revenues: Investment income $ 551 $ 517 6.5 % Management and distribution fees 606 551 9.9 Other revenues 368 320 15.5 ---------- ---------- Total revenues 1,525 1,388 9.9 ---------- ---------- Expenses: Provision for losses and benefits: Annuities 277 259 7.0 Insurance 212 182 16.9 Investment certificates 46 46 0.4 ---------- ---------- Total 535 487 10.1 Human resources 511 457 11.7 Other operating expenses 255 239 6.6 ---------- ---------- Total expenses 1,301 1,183 10.0 ---------- ---------- Pretax income 224 205 9.5 Income tax provision 27 53 (48.8) ---------- ---------- Net income $ 197 $ 152 29.8 % ========== ==========
28 (Preliminary) AMERICAN EXPRESS FINANCIAL ADVISORS SELECTED STATISTICAL INFORMATION (Unaudited) (Millions, except where indicated)
Quarters Ended September 30, ------------------------------ Percentage 2003 2002 Inc/(Dec) ------------ ------------ ------------ Investments (billions) (A) $ 42.3 $ 35.8 18.1 % Client contract reserves (billions) $ 40.8 $ 36.1 13.0 % Shareholder's equity (billions) $ 7.1 $ 6.2 15.3 % Return on average total shareholder's equity (B) 10.1 % 11.3 % - Life insurance inforce (billions) $ 127.5 $ 116.3 9.7 % Assets owned, managed or administered (billions): Assets managed for institutions (C) $ 116.7 $ 43.3 # Assets owned, managed or administered for individuals: Owned assets: Separate account assets (C) 27.6 21.1 31.0 Other owned assets (C) 53.3 47.8 11.5 ------------ ------------ Total owned assets 80.9 68.9 17.5 Managed assets (C) 96.6 79.4 21.7 Administered assets (D) 45.6 29.9 52.6 ------------ ------------ Total $ 339.8 $ 221.5 53.4 % ============ ============ Market appreciation (depreciation) during the period: Owned assets: Separate account assets $ 613 $ (3,143) # Other owned assets $ (388) $ 637 # Managed assets $ 2,134 $ (11,013) # Cash sales: Mutual funds $ 7,361 $ 7,693 (4.3)% Annuities 1,866 2,656 (29.7) Investment certificates 1,542 1,299 18.7 Life and other insurance products 198 170 16.2 Institutional 680 735 (7.7) Other 1,595 1,399 14.1 ------------ ------------ Total cash sales $ 13,242 $ 13,952 (5.1)% ============ ============ Number of financial advisors 11,742 11,353 3.4 % Fees from financial plans and advice services $ 34.9 $ 27.4 27.5 % Percentage of total sales from financial plans and advice services 75.0 % 73.0 % -
# - Denotes a variance of more than 100%. (A) Excludes cash, derivatives, short-term and other investments. (B) Computed on a trailing 12-month basis using total shareholder's equity as reported in the Consolidated Financial Statements prepared in accordance with GAAP. (C) At September 30, 2003, includes $73.2 billion of assets managed for institutions, $2.6 billion of separate account assets, $1.0 billion of other owned assets and $7.9 billion of assets managed for individuals related to the September 30, 2003 Threadneedle acquisition. (D) Excludes non-branded administered assets of $3.1 billion at September 30, 2002. Assuming such assets had been included, the increase in administered assets would have been 38.3%. 29 (Preliminary) AMERICAN EXPRESS FINANCIAL ADVISORS STATEMENTS OF INCOME (Unaudited) (Millions)
Quarters Ended --------------------------------------------------------------------------------- September 30, June 30, March 31, December 31, September 30, 2003 2003 2003 2002 2002 ------------ ------------ ------------ ------------ ------------- Revenues: Investment income $ 551 $ 571 $ 558 $ 577 $ 517 Management and distribution fees 606 571 522 535 551 Other revenues 368 354 331 332 320 ------------ ------------ ------------ ------------ ------------ Total revenues 1,525 1,496 1,411 1,444 1,388 ------------ ------------ ------------ ------------ ------------ Expenses: Provision for losses and benefits: Annuities 277 280 273 283 259 Insurance 212 187 192 203 182 Investment certificates 46 59 41 53 46 ------------ ------------ ------------ ------------ ------------ Total 535 526 506 539 487 Human resources 511 508 479 449 457 Other operating expenses 255 253 248 250 239 ------------ ------------ ------------ ------------ ------------ Total expenses 1,301 1,287 1,233 1,238 1,183 ------------ ------------ ------------ ------------ ------------ Pretax income 224 209 178 206 205 Income tax provision 27 52 45 53 53 ------------ ------------ ------------ ------------ ------------ Net income $ 197 $ 157 $ 133 $ 153 $ 152 ============ ============ ============ ============ ============
30 (Preliminary) AMERICAN EXPRESS FINANCIAL ADVISORS SELECTED STATISTICAL INFORMATION (Unaudited) (Millions)
Quarters Ended --------------------------------------------------------------------------------- September 30, June 30, March 31, December 31, September 30, 2003 2003 2003 2002 2002 ------------- ------------- ------------- ------------- ------------- Investments (billions) (A) $ 42.3 $ 42.4 $ 40.3 $ 38.2 $ 35.8 Client contract reserves (billions) $ 40.8 $ 40.2 $ 38.6 $ 37.3 $ 36.1 Shareholder's equity (billions) $ 7.1 $ 6.7 $ 6.3 $ 6.3 $ 6.2 Return on average total shareholder's equity (B) 10.1 % 9.6 % 9.8 % 10.9 % 11.3 % Life insurance inforce (billions) $ 127.5 $ 124.4 $ 121.4 $ 119.0 $ 116.3 Assets owned, managed or administered (billions): Assets managed for institutions (C) $ 116.7 $ 43.8 $ 41.4 $ 42.3 $ 43.3 Assets owned, managed or administered for individuals: Owned assets: Separate account assets (C) 27.6 24.1 21.3 22.0 21.1 Other owned assets (C) 53.3 52.2 51.5 51.7 47.8 ------------- ------------- ------------- ------------- ------------- Total owned assets 80.9 76.3 72.8 73.7 68.9 Managed assets (C) 96.6 87.3 79.9 81.6 79.4 Administered assets (D) 45.6 37.4 34.0 33.0 29.9 ------------- ------------- ------------- ------------- ------------- Total $ 339.8 $ 244.8 $ 228.1 $ 230.6 $ 221.5 ============= ============= ============= ============= ============= Market appreciation (depreciation) during the period: Owned assets: Separate account assets $ 613 $ 2,620 $ (471) $ 1,040 $ (3,143) Other owned assets $ (388) $ 399 $ 20 $ 23 $ 637 Managed assets $ 2,134 $ 9,457 $ (1,145) $ 3,334 $ (11,013) Cash sales: Mutual funds $ 7,361 $ 7,150 $ 6,800 $ 6,563 $ 7,693 Annuities 1,866 2,581 2,205 2,284 2,656 Investment certificates 1,542 1,607 1,067 959 1,299 Life and other insurance products 198 188 162 182 170 Institutional 680 722 692 521 735 Other 1,595 1,531 1,683 1,269 1,399 ------------- ------------- ------------- ------------- ------------- Total cash sales $ 13,242 $ 13,779 $ 12,609 $ 11,778 $ 13,952 ============= ============= ============= ============= ============= Number of financial advisors 11,742 11,667 11,606 11,689 11,353 Fees from financial plans and advice services $ 34.9 $ 33.5 $ 31.7 $ 26.8 $ 27.4 Percentage of total sales from financial plans and advice services 75.0 % 74.0 % 75.6 % 74.4 % 73.0 %
(A) Excludes cash, derivatives, short-term and other investments. (B) Computed on a trailing 12-month basis using total shareholder's equity as reported in the Consolidated Financial Statements prepared in accordance with GAAP. (C) At September 30, 2003, includes $73.2 billion of assets managed for institutions, $2.6 billion of separate account assets, $1.0 billion of other owned assets and $7.9 billion of assets managed for individuals related to the September 30, 2003 Threadneedle acquisition. (D) Excludes non-branded administered assets of $5.4 billion, $3.8 billion, $3.6 billion, and $3.1 billion for the periods ended June 30, 2003, March 31, 2003, December 31, 2002, and September 30, 2002, respectively. 31 (Preliminary) AMERICAN EXPRESS BANK STATEMENTS OF INCOME (Unaudited) (Millions)
Quarters Ended September 30, ------------------------------ Percentage 2003 2002 Inc/(Dec) ------------ ------------ ------------ Net revenues: Interest income $ 139 $ 158 (11.5)% Interest expense 52 63 (17.7) ------------ ------------ Net interest income 87 95 (7.3) Commissions and fees 58 54 6.5 Foreign exchange income & other revenues 54 50 8.3 ------------ ------------ Total net revenues 199 199 0.3 ------------ ------------ Expenses: Human resources 71 62 18.1 Other operating expenses 69 64 6.9 Provision for losses 20 37 (46.6) Restructuring charges (2) (2) (32.3) ------------ ------------ Total expenses 158 161 (0.7) ------------ ------------ Pretax income 41 38 4.6 Income tax provision 14 13 3.9 ------------ ------------ Net income $ 27 $ 25 4.9 % ============ ============
32 (Preliminary) AMERICAN EXPRESS BANK SELECTED STATISTICAL INFORMATION (Unaudited) (Billions, except where indicated)
Quarters Ended September 30, ------------------------------ Percentage 2003 2002 Inc/(Dec) ------------ ------------ ------------ Total shareholder's equity (millions) $ 952 $ 899 5.9 % Return on average total shareholder's equity (A) 10.4 % 8.2 % - Return on average total assets (B) 0.74 % 0.55 % - Total loans $ 6.2 $ 5.5 12.8 % Total non-performing loans (millions) (C) $ 84 $ 120 (29.9)% Other non-performing assets (millions) $ 15 $ 17 (14.5)% Reserve for credit losses (millions) (D) $ 125 $ 166 (24.5)% Loan loss reserves as a % of total loans 1.9 % 2.8 % - Total Personal Financial Services (PFS) loans $ 1.4 $ 1.6 (14.1)% 30+ days past due PFS loans as a % of total 5.3 % 4.9 % - Deposits $ 10.6 $ 8.6 23.7 % Assets managed (E) / administered $ 15.0 $ 12.2 23.4 % Assets of non-consolidated joint ventures $ 1.7 $ 1.8 (8.6)% Risk-based capital ratios (F): Tier 1 10.5 % 10.2 % - Total 10.8 % 10.9 % - Leverage ratio 6.0 % 5.3 % -
(A) Computed on a trailing 12-month basis using total shareholder's equity as reported in the Consolidated Financial Statements prepared in accordance with GAAP. Prior period amounts have been revised to conform to current presentation. (B) Computed on a trailing 12-month basis using total assets as reported in the Consolidated Financial Statements prepared in accordance with GAAP. (C) AEB defines non-performing loans as loans (other than certain smaller-balance loans) on which the accrual of interest is discontinued because the contractual payment of principal or interest has become 90 days past due or if, in management's opinion, the borrower is unlikely to meet its contractual obligations. For smaller-balance loans, management establishes reserves it believes to be adequate to absorb credit losses inherent in the portfolio. Generally, these loans are written off in full when an impairment is determined or when the loan becomes 120 or 180 days past due, depending on loan type. (D) Allocation (millions): Loans $ 117 $ 156 Other assets, primarily foreign exchange and other derivatives 6 9 Unfunded contingents 2 1 ------------ ------------ Total reserve for credit losses $ 125 $ 166 ============ ============
(E) Includes assets managed by American Express Financial Advisors. (F) Based on legal entity financial information. 33 (Preliminary) AMERICAN EXPRESS BANK STATEMENTS OF INCOME (Unaudited) (Millions)
Quarters Ended ----------------------------------------------------------------------------------- September 30, June 30, March 31, December 31, September 30, 2003 2003 2003 2002 2002 ------------ ------------ ------------ ------------ ------------- Net revenues: Interest income $ 139 $ 148 $ 149 $ 156 $ 158 Interest expense 52 57 60 65 63 ------------ ------------ ------------ ------------ ------------ Net interest income 87 91 89 91 95 Commissions and fees 58 57 55 58 54 Foreign exchange income & other revenues 54 52 53 39 50 ------------ ------------ ------------ ------------ ------------ Total net revenues 199 200 197 188 199 ------------ ------------ ------------ ------------ ------------ Expenses: Human resources 71 64 61 59 62 Other operating expenses 69 70 73 63 64 Provision for losses 20 27 34 31 37 Restructuring charges (2) - - (1) (2) ------------ ------------ ------------ ------------ ------------ Total expenses 158 161 168 152 161 ------------ ------------ ------------ ------------ ------------ Pretax income 41 39 29 36 38 Income tax provision 14 12 10 12 13 ------------ ------------ ------------ ------------ ------------ Net income $ 27 $ 27 $ 19 $ 24 $ 25 ============ ============ ============ ============ ============
34 (Preliminary) AMERICAN EXPRESS BANK SELECTED STATISTICAL INFORMATION (Unaudited) (Billions, except where indicated)
Quarters Ended ------------------------------------------------------------------------- September 30, June 30, March 31, December 31, September 30, 2003 2003 2003 2002 2002 ------------- ------------- ------------- ------------- ------------- Total shareholder's equity (millions) $ 952 $ 955 $ 918 $ 947 $ 899 Return on average total shareholder's equity (A) 10.4 % 10.5 % 10.0 % 9.6 % 8.2 % Return on average total assets (B) 0.74 % 0.75 % 0.71 % 0.66 % 0.55 % Total loans $ 6.2 $ 5.8 $ 5.7 $ 5.6 $ 5.5 Total non-performing loans (millions) (C) $ 84 $ 102 $ 106 $ 119 $ 120 Other non-performing assets (millions) $ 15 $ 16 $ 15 $ 15 $ 17 Reserve for credit losses (millions) (D) $ 125 $ 151 $ 155 $ 158 $ 166 Loan loss reserves as a % of total loans 1.9 % 2.4 % 2.5 % 2.7 % 2.8 % Total Personal Financial Services (PFS) loans $ 1.4 $ 1.5 $ 1.5 $ 1.6 $ 1.6 30+ days past due PFS loans as a % of total 5.3 % 5.5 % 5.0 % 5.4 % 4.9 % Deposits $ 10.6 $ 10.1 $ 9.5 $ 9.5 $ 8.6 Assets managed (E) / administered $ 15.0 $ 14.1 $ 13.1 $ 12.5 $ 12.2 Assets of non-consolidated joint ventures $ 1.7 $ 1.8 $ 1.7 $ 1.8 $ 1.8 Risk-based capital ratios (F): Tier 1 10.5 % 10.5 % 10.8 % 10.9 % 10.2 % Total 10.8 % 10.7 % 11.0 % 11.4 % 10.9 % Leverage ratio 6.0 % 5.5 % 5.5 % 5.3 % 5.3 %
(A) Computed on a trailing 12-month basis using total shareholder's equity as reported in the Consolidated Financial Statements prepared in accordance with GAAP. Prior period amounts have been revised to conform to current presentation. (B) Computed on a trailing 12-month basis using total assets as reported in the Consolidated Financial Statements prepared in accordance with GAAP. (C) AEB defines non-performing loans as loans (other than certain smaller-balance loans) on which the accrual of interest is discontinued because the contractual payment of principal or interest has become 90 days past due or if, in management's opinion, the borrower is unlikely to meet its contractual obligations. For smaller-balance loans, management establishes reserves it believes to be adequate to absorb credit losses inherent in the portfolio. Generally, these loans are written off in full when an impairment is determined or when the loan becomes 120 or 180 days past due, depending on loan type. (D) Allocation (millions): Loans $ 117 $ 142 $ 145 $ 151 $ 156 Other assets, primarily foreign exchange and other derivatives 6 5 5 6 9 Unfunded contingents 2 4 5 1 1 ------------- ------------- ------------- ------------- ------------- Total reserve for credit losses $ 125 $ 151 $ 155 $ 158 $ 166 ============= ============= ============= ============= =============
(E) Includes assets managed by American Express Financial Advisors. (F) Based on legal entity financial information. 35