American Express Delinquency Edges Higher in March Quarter
2h ago|8 min read1Deep Dive
Fazen Markets Research
Expert Analysis
american-express
American Express reported a measured increase in card loan delinquencies for the March quarter, with the 30+ day delinquency rate recorded at 1.10% in the SEC filing dated April 15, 2026. The company flagged a net write-off rate of 2.45% for the period, up from 1.75% a year earlier, according to the same filing and corroborated by an Investing.com summary published Apr 15, 2026. These moves come as credit performance across consumer finance portfolios has shown early signs of deterioration since late 2025, pressuring reserve builds and provisioning decisions at major card issuers. For institutional investors, the numbers are notable given American Express's concentrated exposure to higher-income cardholders and greater reliance on charge and revolving products compared with peers. This report breaks the metrics down, places them in historical context versus peers, and examines potential implications for credit reserves, earnings volatility, and portfolio strategy.
American Express's disclosure on April 15, 2026, follows a quarter during which other card issuers have signalled rising strain in unsecured consumer credit. The 30+ day delinquency rate of 1.10% is a concrete point of comparison with the same period in 2025 when AmEx recorded 0.78%—a year-on-year rise of roughly 0.32 percentage points or about 41%. That trajectory aligns with broader indicators: the Federal Reserve Consumer Credit outstanding series showed a sequential uptick in Q1 2026, and consumer credit card balances rose by 3.2% quarter-on-quarter in Q1 per national statistics. Investors should view AmEx's disclosure not in isolation but alongside macro drivers such as wage growth momentum, unemployment trends, and interest-rate sensitivity of revolving balances.
The composition of American Express's portfolio matters. Unlike banks with large prime and subprime card books, AmEx skews toward premium cardholders with higher incomes and spend profiles, yet premium customers can still become more delinquent when real incomes are squeezed or when interest rates bite into servicing costs for revolving balances. The firm's charge-card exposure, merchant services receipts, and fee income create revenue offsets that differ from the fee-and-interest mix at peers such as Capital One (COF) or traditional banks like JPMorgan Chase (JPM). That structural difference means AmEx may show later-cycle credit deterioration compared with issuers who underwrite more to subprime cohorts.
From a regulatory and reporting standpoint, the April 15 SEC filing remains the authoritative source for the metrics cited here, supplemented by the Investing.com coverage of the release on the same date. The filing disclosed both delinquency buckets and write-off rates, enabling analysts to reconcile trends in net charge-offs and allowance balances. For fixed-income and equity investors, these disclosures increase transparency on forward-looking loss estimates and on how management is positioning credit reserves heading into a period where default timing is uncertain.
Three headline metrics anchor the March-quarter disclosure: 30+ day delinquency at 1.10% (SEC filing, Apr 15, 2026), net write-off rate of 2.45% (SEC filing, Apr 15, 2026), and a 90+ day delinquency bucket of 0.30% (Investing.com summary, Apr 15, 2026). Each metric has a vintage effect. The 30+ day delinquency increase of 0.32 percentage points YoY represents a notable inflection given that AmEx's delinquency rates had been relatively stable through 2023 and 2024. The rise in net write-offs to 2.45% from 1.75% a year earlier implies both higher default incidence and potentially more aggressive charge-off timing.
Quarter-on-quarter movement also matters for provisioning cadence. The net write-off rate climbed from 2.1% in Q4 2025 to 2.45% in Q1 2026, an increase of 0.35 percentage points in three months, per company disclosures. That pace suggests management may need to reassess allowance for credit losses (ACL) relative to expected credit loss models, particularly if early-stage delinquencies continue to accelerate. By contrast, peers have reported varied trajectories: Capital One reported a year-on-year NCO increase of roughly 0.9 percentage points in its last quarterly filing, while Visa and Mastercard, as network companies, have limited direct credit exposure but see merchant volumes as an indicator of consumer stress.
A cross-check with macro indicators provides additional signal. The Employment Cost Index and wage nominal growth slowed in Q1 2026, while headline CPI remained elevated versus central-bank targets, compressing real incomes for lower and middle-income cohorts. Although AmEx's customer base is skewed wealthier, the broader squeeze on discretionary spending could reduce repayment capacity on revolving balances, pushing some accounts into delinquency. Investors should triangulate these data points with issuer-specific metrics such as average FICO, concentration by travel and leisure categories, and the share of balances that are unsecured versus secured by deposits or collateral.
The credit metrics reported by American Express, while modest in absolute terms, carry sector-wide implications. A rising net write-off path at a major issuer increases the probability of earnings volatility for other lenders with similar unsecured consumer exposures. Banks and specialty finance firms that financed credit card receivables, including securitization conduits and ABS investors, will be monitoring early-stage delinquency lifts as potential leading indicators of loss severity. For card networks and processors, shifts in delinquency may influence merchant acceptance dynamics and fee timing if consumer spend patterns alter materially.
Comparative analysis versus peers highlights divergence in underwriting and product mix. AmEx's 1.10% 30+ delinquency rate compares with reported 30+ delinquencies at some peers that ranged from 1.5% to 3.0% in the same reporting cycle, depending on the issuer and credit mix. The YoY increase at AmEx is sharper in percentage terms than some prime-focused competitors but remains lower in absolute terms than issuers with higher subprime share. Credit investors should therefore evaluate balance-sheet sensitivity to incremental delinquencies, capital buffers, and the elasticity of fee income that can offset credit losses.
For lenders that sell receivables into the securitization market, increased delinquencies can widen spreads on new ABS transactions and increase loss expectations for existing pools. Market pricing for credit-card asset-backed securities has already reflected a modest premium for risk in 2026; incremental deterioration at a large issuer could amplify that repricing. Institutional investors may want to reassess seasoning risks in short-dated tranches and monitor trustee reports for early indicators of accelerated charge-offs.
American Express's numbers raise three broad risk vectors: reserve adequacy, earnings volatility, and funding costs. Reserve adequacy hinges on management's forward-looking assumptions in ACL models, which must now incorporate an elevated delinquency baseline and the potential for higher severity. If ACL builds become larger than expected, provisioning will compress reported net income near-term; conversely, a conservative reserve posture could mute earnings upside in better-than-expected macro outcomes.
Earnings volatility will be influenced by two offsetting dynamics: higher write-offs on loans reduce net interest margin and non-interest income if card spend slows, but AmEx benefits from diversified revenue streams including merchant services and strong fee income on premium products. Funding costs are another channel: if capital markets perceive higher credit risk, unsecured funding spreads for non-bank card issuers can widen, increasing funding expense and pressuring net interest income. For investors in securitized structures tied to AmEx receivables, the primary risk is loss severity exceeding stress-case assumptions.
Operational risks include the possibility of more aggressive collection strategies that could depress spend or customer retention, as well as reputational risks if defaults concentrate in specific merchant categories or geographies. Regulators will monitor consumer outcomes and the mechanics of charge-offs, particularly in an environment where policy attention to consumer-finance practices remains elevated. The interplay of macro, underwriting, and operational responses will determine whether observed deterioration remains a transient uptick or evolves into a protracted loss cycle.
Near term, expect volatility in AmEx credit metrics as early-stage delinquencies filter through to charge-offs. If the labor market softens further or real incomes decline, the 30+ day delinquency rate could move higher by another 20-40 basis points over the next two quarters, which would meaningfully impact net write-offs and may require incremental ACL. Conversely, a stabilization in wage growth and a pickup in travel and dining spend could blunt deterioration and allow management to absorb higher write-offs without materially increasing reserves.
Market participants will watch the next quarterly report for confirmation of trend direction, and traders may price in a range of outcomes into AXP equity and credit spreads. For fixed-income holders and ABS investors, stress-testing scenarios should incorporate a sustained net write-off rate nearer 3.0% as a conservative scenario versus the current 2.45% reported for March 2026. Comparisons with historical cycles—such as the 2008 crisis and the COVID-19 shock in 2020—remain instructive: losses in those periods were driven by macro shocks and systematic unemployment, which are not the prevailing conditions today, but targeted industry shocks could still elevate losses in discrete portfolios.
Our view diverges from a simple read that higher delinquencies at American Express are uniformly negative. The company s concentrated affluent customer base and strong fee income provide levers that can partially offset credit deterioration, particularly if management prioritizes retention of high-value customers over aggressive collections. Additionally, AmEx's data analytics and proprietary underwriting give it an informational edge that can allow for more surgical risk remediation—adjusting credit lines, re-pricing revolving balances, and deploying targeted loyalty incentives to preserve spend.
That said, investor complacency about premium credit quality could be costly. The observed increase from 0.78% to 1.10% in the 30+ bucket year-on-year is statistically meaningful and suggests early-stage credit stress even among higher-FICO cohorts. For investors owning securitized exposures or short-duration credit, hedging strategies that capture widening in issuer spreads may be prudent given the asymmetric upside of further deterioration. For equity investors, narrative risk—an unexpected acceleration in net write-offs—could trigger outsized price moves relative to fundamentals because of valuation multiples anchored to fee revenue and discount rates.
Fazen Markets also flags an underappreciated dynamic: the potential for cross-product contagion. If card delinquencies rise materially, merchant-acquiring volumes and co-brand partnerships may weaken, amplifying revenue shocks through both interest and fee channels. Monitoring merchant-level spend trends and category concentration can provide earlier warnings than aggregate delinquencies alone. For deep-dive analysis on consumer-credit trends and securitization impacts, see our coverage on consumer credit and credit risk.
Q: How does AmEx's March-quarter delinquency compare to 2008 and 2020 peaks?
A: The March 2026 30+ delinquency rate of 1.10% is materially below the peaks seen during acute systemic stress in 2008 and 2020, when some unsecured portfolios exceeded 5%–10% depending on cohort and issuer. However, those episodes were characterized by extreme macro dislocation and systemic unemployment, conditions not present today. The comparison is useful for stress-test calibration but does not imply a repeat of past extremes.
Q: What are the practical implications for ABS investors and securitization spreads?
A: Rising early-stage delinquencies typically lead to wider spreads on new ABS issuance as investors demand higher risk premia and more credit enhancement. For existing pools, investors should monitor excess spread, cumulative net losses, and triggers in trust documents; moderate deterioration can be absorbed, but sustained increases may accelerate principal taps and shorten expected cashflows. Institutional holders should review trustee reporting and scenario analyses for performance deterioration.
American Express's March-quarter rise in delinquencies and write-offs is a measured signal of early credit stress that warrants close monitoring, with implications for reserves, earnings volatility, and securitization pricing. Investors should triangulate issuer disclosures with macro indicators and peer reports to gauge whether the uptick is transient or the beginning of a broader credit cycle shift.
Disclaimer: This article is for informational purposes only and does not constitute investment advice.
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