AMERICAN EXPRESS CREDIT ACCOUNT MASTER TRUST

AMERICAN EXPRESS CREDIT ACCOUNT MASTER TRUST

Thinking about AMERICAN EXPRESS CREDIT ACCOUNT MASTER TRUST? Let's explore what it is. We'll also see how it performed this past year. This summary avoids confusing financial terms. Think of it as a chat with a friend. It will help you understand if this is a good place for your money.

First, know this: the AMERICAN EXPRESS CREDIT ACCOUNT MASTER TRUST isn't a regular company. You can't buy its stock. It's not like buying shares of American Express (the credit card company). Instead, it's a special financial arrangement. It holds many credit card accounts and their balances. These balances are called 'receivables.' American Express National Bank created these accounts. The Trust issues 'asset-backed securities' (ABS). These are different from company stock. ABS are investments backed by these credit card balances. They let American Express get cash now. This cash comes from future credit card payments. It helps American Express fund its operations. It also helps manage its finances. So, you can't buy shares of this Trust. But understanding it shows you a part of the larger American Express world.

This report covers the year ending December 31, 2025.

What does this company do and how did they perform this year?

As we said, this Trust isn't a typical company. Imagine it as a special vault. It holds many credit card balances. American Express National Bank created these balances. The Trust's main job is to manage these balances. It uses them to back specific investments. These are the asset-backed securities we mentioned. This process is called 'securitization.' It lets American Express sell parts of these balances to investors. This provides money for its credit card business. Since it's a Trust, not a regular business, this report differs. Instead, its 'performance' means two things. First, how healthy are the credit card balances? Second, do they consistently generate cash? Also, how well are these accounts managed?

Financial performance - revenue, profit, growth metrics

This Trust isn't a traditional business. Its goal is different. It manages specific assets, not to earn its own operating profit. For investors in its asset-backed securities, 'performance' means other things. It includes how quickly people pay their bills (payment rates). It also looks at late payments (delinquency rates). And it tracks uncollectible debt (charge-off rates). These are all for the credit card balances it holds. The report also shows the total amount of balances. This includes the main amount owed (principal receivables). It also includes interest and fees (finance charge receivables). The report notes that no single customer owes a huge amount. This means the credit card balances are spread out. This 'diversification' is key for ABS investors. It lowers the risk if one person can't pay.

Major wins and challenges this year

Lawsuits involving American Express Company, the parent company that sponsors the Trust, and The Bank of New York Mellon, the Trustee, are mentioned. These lawsuits are not directly against the Trust itself. But they could indirectly affect American Express, potentially impacting the credit card balances available to the Trust. This could change how many or how good these balances are.

• Lawsuits against American Express (the sponsor): American Express faced several lawsuits. These concerned its agreements with merchants. Specifically, 'anti-steering' and 'non-discrimination' rules were challenged. Plaintiffs claimed these rules broke antitrust laws. They alleged merchants couldn't suggest cheaper payment options. If these rules change, American Express's position could weaken. Its card network's profit might also suffer. This could then affect how many credit card balances are created.
  • In Moskowitz v. American Express, a jury ruled against American Express. This trial was in August 2025. It awarded $12.5 million. The claim involved an Illinois consumer law. It related to cardholders without rewards. American Express agreed to settle all claims. This settlement awaits court approval. It aims to end the dispute. It also avoids more legal costs and bad press.
  • Another case was B&R Supermarket v. Visa Inc., et al.. It claimed American Express and others conspired. They allegedly shifted fraud costs to merchants. American Express also settled this case in March 2025. This settlement also awaits court approval. It helps reduce ongoing legal risk for merchant issues.
  • Other ongoing cases, like Pizza Hazel, Inc., are similar. They also claim antitrust violations. American Express is appealing court orders. These orders would force arbitration. These lawsuits show ongoing pressure on American Express's business. This comes from regulators and competitors.
• Lawsuits against The Bank of New York Mellon (the Trustee): The Bank of New York Mellon is the Trust's Trustee. It faces its own lawsuits. These relate to its role as trustee for mortgage-backed securities. The report clearly states the Trust is not involved. American Express is also not involved. This is key for investors. It means the Trust isn't directly responsible for these mortgage-related legal problems.

Financial health - cash, debt, liquidity

The Trust's 'financial health' depends on its assets, which are the credit card balances it holds. Key measures include cardholders' average FICO scores, the percentage of late accounts (30, 60, or 90 days past due), the net charge-off rate (uncollectible debt), and the monthly payment rate. These directly affect the cash available for investors. The report focuses on the health and management of these credit card balances. The Trust has no stock owned by outside parties, confirming it's not a stock investment. Its funding comes only from the asset-backed securities it issues.

Key risks that could hurt the stock price

Indirect risks matter for ABS investors. Bad results from lawsuits against American Express (the sponsor) could hurt its brand or affect its ability to create new credit card balances. For instance, antitrust rulings might change merchant agreements, potentially lowering American Express's profit or market share. This could lead to fewer or lower-quality credit card balances going to the Trust, indirectly affecting ABS performance. The report notes the Trust's assets have no 'significant obligors,' which helps spread risk. However, economic slowdowns like a recession, higher unemployment, or rising interest rates could lead to more late payments, more uncollectible debt, and lower payment rates. This would reduce cash for the Trust and could impact returns for ABS investors.

Competitive positioning

The Trust holds specific assets and doesn't 'compete' like a credit card company or bank. Its role is about administration and financial setup, helping American Express National Bank manage its credit card balances and get money from investors.

Leadership or strategy changes

The Trust isn't a company with a management team. It operates under established legal agreements, and its actions follow the rules in its securitization documents.

Future outlook

The Trust is mainly a compliance filing for an asset-backed securities trust, not a forward-looking business report. Its operations are mostly passive, focusing on holding and managing credit card balances according to its securitization agreements.

Market trends or regulatory changes affecting them

Regulatory compliance is covered in the 'Servicing Criteria' section. American Express Travel Related Services (TRS) and American Express National Bank (AENB) are key 'Servicing Participants.' They manage the Trust's assets by processing payments, handling disputes, and managing collections for the credit card accounts. Their reports for 2025 found no major issues, with no 'material instances of noncompliance' with servicing rules. This indicates the Trust's assets are managed well and meet regulatory standards, building investor confidence in the asset-backed securities. Lawsuits against American Express (the parent company) highlight ongoing regulatory and antitrust review, which could change how credit card programs work. This might affect how profitable or risky the balances become, indirectly affecting the Trust.

So, what does this mean for you? The main point is clear. The AMERICAN EXPRESS CREDIT ACCOUNT MASTER TRUST is not a company. You cannot buy its stock. It's a special financial tool that helps American Express manage its credit card balances and issue asset-backed securities. This report confirms accounts are managed properly, with no major issues with the Trust's direct work. Instead, it gives transparency to ABS investors, assuring them the credit card balances are well-managed.