| American Express (ticker tape: NYSE: AXP) is global financial services company, which has headquarters in New York. Company is known for its credit cards, charge cards & “traveller's cheques”. Common stocks of the company are traded on the New York stock exchange. It is one of 30 stocks, which include Dow Jones Industrial Average.
Usually, American Express is shortened as “Amex”.
Welfare work
American Express is one of the provider companies of the American Enterprise Institute.
American Express, one of the world leaders in credit card services, will be transformed into bank holding company, informs The New York Times. Banking Regulations Committee of Federal Reserve System, USA has already given approval for changing the status of financial organization.
Actually, nothing changes for clients of American Express - future bank will, as usual, cater to the issued cards. Organization can considerably expand the list of financial services, rendered by it & due to this, it can have new more reliable source of income. Besides, American Express can apply for governmental credit of $3.8 billion.
For last year, stocks of American Express have gone cheaper by 60.35%. On November 12, 2008, capitalization of financial organization constituted $25.98 billion. To cut the expenditure, American Express, at the end of October 2008, took a decision to sack 10% of its employees & to freeze the compensation of the directors. These measures will allow the company to save $1.8 billion in 2009.
American Express is not the first organization in USA, which has decided to become diversified bank. On September 21, 2008, Federal Reserve permitted investment banks “Goldman Sachs” & “Morgan Stanley” to change the legal status from independent investment banks to bank holding company. As a result of the conversion, former investment banks can create commercial divisions, which will operate client accounts. |
Days ago American Express asked and received the Fed's approval to become a bank, so that it can use part of the $700 billion bailout amount. Now it wants $3.5 billion out of the $700 billion bailout pie. Amex reasoning for such request is - "we lost a lot of money due to missed credit card payments. Now it's only fair to get part of this money back from taxpayers."
