American Express 2003 Annual Report Download - page 22

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At AEFA, we have a number of competitive advantages that we are able to leverage. We have one of the largest
advisor field forces in the United States. We produce a broad array of mutual fund, annuity and other insurance
products. And we have a comprehensive financial planning and advice model that has a long-term track record
of success. We think these advantages and the progress we are making in implementing our growth strategies
position us well relative to our competitors.
AMERICAN EXPRESS BANK
American Express Bank (AEB) continued to deliver strong results despite the weak environment in some key
markets around the world. Net income rose 27 percent to $102 million in 2003, up from $80 million a year ago.
Net revenues totaled $801 million. Assets managed and administered grew 29 percent to $16.2 billion.
The Bank produced double-digit growth in Private Banking client holdings and solid revenue growth in both
the Private Bank and the Financial Institutions Group.
In Private Banking, AEB launched new mutual funds, hedge funds and other investment and insurance products.
In the Financial Institutions Group, which serves over 1,700 banks around the world, we continued to grow our
international payments and investment distribution businesses.
The Bank continued to make progress in its strategic shift from corporate lending to consumer and private bank-
ing. Corporate loans were reduced by 47 percent to $173 million and now make up just 3 percent of the Bank’s
total loan portfolio.
The Bank has become an important contributor to other American Express businesses. For example, the Bank
distributes American Express Funds, most of which are managed by AEFA, through a network of more than
260 bank partners worldwide. This business has more than doubled over the past year to $2.65 billion in assets
under management. AEB also cross-sells its Private Banking products to American Express’ international card-
member base and premium card products to its Private Banking clients. The acquisition of Threadneedle will
provide additional depth to the lineup of products offered by the Bank.
(p.20_axp)
GLOBAL PAYMENTS — We launched more than 80 new or enhanced proprietary card products in international markets in
2003. These included the American Express Platinum Membership Rewards Credit Card in New Zealand, the Centurion Card
in Japan, the KLM Flying Dutchman American Express Card in the Netherlands and the International Dollar Platinum Card in
Latin America and the Caribbean.