American Express 2015 Annual Report Download - page 83

Total expenses increased $57 million or 2 percent in 2014 compared to 2013, primarily driven by the reinvestment
of a significant portion of the gain from the business travel joint venture transaction in growth initiatives, partially
offset by a charge in 2013 to reserve for the previously mentioned merchant litigation settlement.
TABLE 16: GNMS SELECTED STATISTICAL INFORMATION
As of or for the Years Ended December 31,
(Millions, except percentages and where indicated) 2015 2014 2013 Change 2015 vs. 2014 Change 2014 vs. 2013
Global worldwide card billed business (billions) ...... $1,039.7 $1,022.8 $952.4 2% 7%
Total segment assets (billions) .................... $ 23.6 $ 18.1 $ 17.1 30 6
Segment capital (a) ............................... $ 2,397 $ 1,970 $ 1,952 22 1
Return on average segment capital (b) .............. 78.4% 84.0% 76.8%
Return on average tangible segment capital (b) ....... 86.2% 92.9% 84.9%
Global Network Services:
Card billed business (billions) ................... $ 166.0 $ 160.7 $ 144.1 3 12
Total cards-in-force ............................ 47.4 44.0 40.7 8% 8%
(a) As of September 30, 2015, and prospectively, certain intercompany balances have been reclassified between operating segments, as a result of
systems enhancements.
(b) Return on average segment capital is calculated by dividing (i) one-year period segment income ($1.8 billion, $1.7 billion and $1.6 billion for
2015, 2014 and 2013, respectively) by (ii) one-year average segment capital ($2.3 billion, $2.0 billion and $2.1 billion for 2015, 2014 and 2013,
respectively). Return on average tangible segment capital, a non-GAAP measure, is computed in the same manner as return on average
segment capital except the computation excludes from average segment capital average goodwill and other intangibles of $206 million, $189
million and $195 million as of December 31, 2015, 2014 and 2013, respectively. We believe return on average tangible segment capital is a useful
measure of the profitability of our business.
CORPORATE & OTHER
Corporate functions and certain other businesses, including EG and other operations, are included in Corporate &
Other.
Corporate & Other net expense increased to $1.1 billion in 2015, compared to $929 million and $900 million in
2014 and 2013, respectively. The increase in net expense was driven by EG charges in the third and fourth quarter of
2015 of $91 million and $419 million, respectively. The third quarter charge of $91 million related to previously
capitalized software development costs, while the fourth quarter charge of $419 million reflected a write-down in
goodwill ($219 million) and technology and other ($165 million), plus restructuring charges ($35 million). These 2015
charges were partially offset by higher restructuring costs in 2014. Refer to Note 2 to the “Consolidated Financial
Statements” for further details on the fourth quarter EG impairment charges.
Results for all periods disclosed also include net interest expense related to maintaining the liquidity pool
discussed in “Consolidated Capital Resources and Liquidity — Liquidity Management,” as well as interest expense
related to other corporate indebtedness.
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