4962--2/26/2010--AMERICAN_EXPRESS

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{system, service, information}

{capital, credit, financial}

{regulation, change, law}

{condition, economic, financial}

{regulation, government, change}

{competitive, industry, competition}

{financial, litigation, operation}

{loss, insurance, financial}

{personnel, key, retain}

{operation, international, foreign}

{product, market, service}

{stock, price, share}

{investment, property, distribution}

{property, intellectual, protect}

{cost, operation, labor}

{stock, price, operating}

Current Economic and Political Risks Difficult conditions in the global capital markets and economy generally, as well as political conditions in the United States and elsewhere, may materially adversely affect our business and results of operations. Adverse capital and credit market conditions may significantly affect our ability to meet liquidity needs, access to capital and cost of capital. We can be adversely affected by the impairment of other financial institutions. Any reduction in the Company s and its subsidiaries credit ratings could increase the cost of our funding from, and restrict our access to, the capital markets and have a material adverse effect on our results of operations and financial condition. Adverse currency fluctuations and foreign exchange controls could decrease revenue we receive from our international operations. The Credit Card Accountability Responsibility and Disclosure Act of 2009 will significantly impact our business practices and could have a material adverse effect on our results of operations. Proposed legislative and regulatory reforms could, if enacted or adopted, result in our business becoming subject to significant and extensive additional regulations, which could adversely affect our results of operations and financial condition. Potential actions by the FDIC and the rating agencies could impact the Company s ABS program. Our financial condition and results of operations could be adversely affected by increases in FDIC deposit insurance assessments. Our business, financial condition and results of operations could be adversely affected by new regulation and supervision to which we are subject as a result of becoming a bank holding company. We are subject to restrictions that limit our ability to pay dividends and repurchase our capital stock. Banks, card issuers and card network operators generally are the subject of increasing global regulatory focus, which may impose costly new compliance burdens on our Company and lead to decreased transaction volumes and revenues through our network. If we are not able to protect our intellectual property, and invest successfully in, and compete at the leading edge of, technological developments across all our businesses, our revenue and profitability could be negatively affected. Regulation in the areas of privacy and data security could increase our costs and decrease the number of charge and credit cards issued. Our success is dependent, in part, upon our executive officers and other key personnel, and the loss of key personnel could materially adversely affect our business. Litigation and regulatory actions could subject us to significant fines, penalties and/or requirements resulting in increased expenses. Our operating results may suffer because of substantial and increasingly intense competition worldwide in the payments industry. We face increasingly intense competitive pressure that may impact the prices we charge merchants who accept our Cards for payment for goods and services. We may not be successful in our efforts to promote Card usage through our marketing, promotion and rewards programs or to effectively control the costs of such programs, both of which may impact our profitability. Our brand and reputation are key assets of our Company, and our business may be affected by how we are perceived in the marketplace. An increase in account data breaches and fraudulent activity using our Cards could lead to reputational damage to our brand and could reduce the use and acceptance of our charge and credit Cards. We have agreements with business partners in a variety of industries, including the airline industry, that represent a significant portion of our business. We are exposed to risks associated with these industries, including bankruptcies, restructurings, consolidations and alliances of our partners, and the possible obligation to make payments to our partners. Our reengineering and other cost control initiatives may not prove successful, and we may not realize all or a significant portion of the benefits we intended. Our risk management policies and procedures may not be effective. An inability to accept or maintain deposits due to market demand or regulatory constraints could materially adversely affect our liquidity position and our ability to fund our business. If our global network systems are disrupted or we are unable to process transactions efficiently or at all, our revenue and profitability would be materially reduced. We rely on third-party providers of various computer systems and other services integral to the operations of our businesses. These third parties may act in ways that could harm our business. Special Note About Forward-Looking Statements U.S. Card Services and Global Merchant Services Matters Chairman, Chief Executive Officer and

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4962--2/26/2010--AMERICAN_EXPRESS_CO