AmEx 4Q profit up 24 percent

American Express Corp., the fourth-biggest U.S. credit-card issuer, on Monday reported stronger holiday shopping and a reduction in bankruptcy write-offs helped lift fourth-quarter profit by 24 percent.

The New York-based financial and travel services company reported a profit of $922 million, or 75 cents per share, for the September-December period, compared with $745 million, or 59 cents per share, a year earlier. Revenue increased 13 percent to $7.21 billion from $6.38 billion.

The quarterly results cap a transformative year for AmEx, which in 2005 spun off its Ameriprise Financial Inc. unit to focus on growing its card and travel businesses. Chairman and Chief Executive Kenneth I. Chenault has focused this year on striking deals with banks to issue AmEx cards, and also capturing more business from high-spending consumers.

"Our strong revenue and earnings this quarter were driven by record cardmember spending during the holiday shopping season and continued growth in our loan portfolio," Chenault said in a press release.

The results follow the same growth seen at American Express' biggest competitors. JPMorgan Chase & Co., Citigroup Inc., Capital One Financial Corp., and Morgan Stanley Inc. all reported their card divisions had stronger profit during the fourth quarter.

Part of this is due to new U.S. bankruptcy laws that make it harder for consumers to avoid paying debt. The company _ which typically has a lower instance of defaults because its customers tend to be more affluent _ set aside $277 million for losses from its credit-card unit, a 4 percent decline from the same period a year earlier.

This helped drive profit significantly higher than the year-ago period. The year-ago results included its banking business in Brazil, which American Express sold in the second quarter.

Excluding that business and other discontinued operations, the company reported fourth-quarter profit rose to $925 million, or 76 cents per share, from $751 million, or 60 cents per share.

This matched Wall Street projections for earnings of 76 cents per share, according to analysts polled by Thomson Financial. However, the company missed analysts expectations for revenue of $7.33 billion during the period.

AmEx said it added 1.5 million cards during the latest quarter, and attributed the gain to increased marketing and member-rewards used to entice customer spending. Expenses rose 10 percent to $6 billion, while customer spending increased 16 percent to $153.5 billion.

Profit at its core card business rose 29 percent to $535 million during the fourth quarter. However, international card services dipped 1 percent to $231 million.

American Express also said its payment-network business, which processes card transactions, rose 21 percent to $201 million. This is a relatively new business for the company since a court ruling in 2004 allowed U.S. banks to issue cards on competitive networks such as the one run by American Express.

Banks previously issued only Visa and MasterCard, which was deemed anticompetitive. A big part of American Express' business this year has been persuading U.S. financial institutions to incorporate its cards and services to customers.

Profit in 2006 slipped 1 percent to $3.71 billion, or $2.99 per share, from $3.73 billion, or $2.97, in the previous year. The decline resulted from the spin off of Ameriprise.

Stripping out Ameriprise and other discontinued operations, the company reported profit rose 16 percent to $3.73 billion, or $3.01 per share, from $3.22 billion, or $2.56 per share, in 2005.

American Express shares were unchanged at $58.09 in afternoon trading on the New York Stock Exchange. The stock rose 18 percent last year, and posted a 52-week high of $62.50. Ameriprise, which reports results on Thursday, fell 64 cents to $56.96.