Ron Stovall – Senior Vice President of Investor Relations Daniel T. Henry – Chief Financial Officer & Executive Vice President

Meredith Whitney – Oppenheimer & Co. Craig Maurer – Calyon Securities (USA), Inc. Robert Napoli – Piper Jaffray Sanjay Sakhrani – Keefe, Bruyette & Woods David Hochstim – Bear Stearns Brad Ball – Citigroup Eric Wasserstrom – UBS Mike Taiano – Sandler O’Neill & Partners L.P. Moshe Orenbuch – Credit Suisse Meredith Whitney – Oppenheimer & Co.

Welcome to the American Express first quarter 2008 earnings conference call. (Operator Instructions) At this time I’d like to turn the conference over to our host, Senior Vice President of Investor Relations, Ron Stovall.

As usual it’s my role to remind you that the discussion today contains certain forward-looking statements about the company’s future financial performance and business prospects which are subject to risks and uncertainties and speak only as of today. The words believe, expect, anticipate, optimistic, intend, plan, aim, will, should, could, likely and similar expressions are intended to identify forward-looking statements. Factors that could cause actual results to differ materially from these forward-looking statements included in the company’s financial and other goals are set forth within today’s earnings press release which was filed in an 8-K report and in the company’s 2007 10-K report already on file with the Securities & Exchange Commission. In the first quarter 2008 earnings release and supplement which are now posted on our website at ir.AmericanExpress.com and on file with the SEC in an 8-K report we have provided information that describes the company’s managed basis and other non-GAAP financial measures and the comparable GAAP financial information and we explain why these presentations are useful to management and to investors. We urge you to review that information in conjunction with today’s discussion. Dan Henry, Executive Vice President and Chief Financial Officer of American Express will provide some introductory remarks highlighting the key points related to today’s announcement. Once he completes his remarks we will turn to the moderator who will announce your opportunity to get in to the queue for the Q&A period. Up until then no one is actually registered to ask questions. While we will attempt to respond to as many of your questions as possible before we end the call, we do have a limited amount of time. Based on this we ask that you limit yourself to one question at a time during the Q&A. With that, let me turn the discussion over to Dan. Daniel T. Henry: As you’ve seen in our earnings documents despite the more difficult economic environment our first quarter results reflect the continuation of strong business growth on a relative basis and the benefit of our diversified business portfolio, our multiyear investments and a broad range of business building initiatives again yield industry leading performance for the quarter as they have over the past few years. As expected, earnings for the quarter were somewhat below last year. Our strong revenue growth was offset by the impact of the difficult US credit environment and higher marketing spending compared to the lower amounts in 2007. As we discuss the results it’s important to keep in mind that the translation of foreign currency significantly impacted recorded revenues and expense growth rates increasing each by 3%. When you compare our results from continuing operations to the first quarter of last year net revenue grew 11% while income decreased 11% and diluted EPS of $0.84 decreased 7%. ROE was 36%. For those of you who follow revenue consensus estimates that each quarter there has been some noise around the way that the consensus is tabulated by some reporting services. This continues to be the case as it is computed in a way that is likely to be above our reported numbers. Let me remind you that last year’s first quarter included $50 million after tax from the initial adoption of FAS 155 and $39 million after tax pension related gain. Both of these contributed to the year-over-year decline in income. During the quarter we returned 38% of capital generated to our shareholders through share repurchase and dividends. We slowed our share repurchase program during the quarter in order to allow the capital generated through earnings to help fund the recent acquisition of GE’s corporate payment services business. Since 1994 we have returned 70% of capital generated to shareholders which is above our 65% long term target. The 11% revenue growth in the quarter reflects double digit growth in a number of categories including discount revenue, card member lending finance revenue, card fee revenue and commissions and fees. Additionally, revenue growth reflected the benefit of lower interest rates. Revenue continues to be driven by solid growth in card member spending, loans and cards in force. Given the weaker economic environment worldwide billed business growth for the quarter was particularly strong at 14% or 11% on an FX adjusted basis which is the more important indicator of the underlying health of the business volumes. In our US proprietary business consumer spending grew 7% in the quarter, small business spending increased 11% and corporate services volumes rose by 8%. These growth rates while far better than the industry are 300 basis points lower than the growth rates in the fourth quarter of 2007. In total US volumes for retail and everyday spending grew 11%. This category represented about 68% of US billings. Travel and entertainment related spending which accounts for the remainder rose 8%. Outside the US proprietary billed business grew 22% on a reported basis. This translated to an increase of 10% on an FX adjusted basis reflecting 9% growth in our consumer and small business activity and a 10% increase in corporate services. These growth rates have held up well outside of the US. Within global network services billed business rose 50% driven by continued robust growth both in and outside of the US. Worldwide cards in force rose 10%. We added 1.6 million net new cards during the quarter and 8.1 million net new cards since last year. This reflects 5% growth versus last year in proprietary cards and 33% growth in network partner cards. Spending per proprietary basic card rose 6% worldwide while 3% on an FX adjusted basis even with the suppressing effects of substantial card additions over the past few years. Our average discount rate of 2.57% decreased one basis point from last year but increased versus last quarter reflecting the typical seasonal impact of lower retail related business volumes in the first quarter. Net card fee revenue increased 17% due to card growth as well as higher average fees per card. Travel commissions and fees increased 13% driven by 15% increase in travel sales. Worldwide lending balances on an owned basis rose 17%. On a vantage basis balances grew 19% on 18% growth in the US and 23% or a 13% FX adjusted growth within our non-US portfolios. \This is a slower growth rate in the US managed loans than recent quarters due to the initial impact of various credit related actions such as targeted line reductions for higher risk customer segments, industries and geographies and increased efforts in our collection and credit areas and the flow through of slower spending growth within our co-brand, lending on charge and other credit card relationships. These were partially offset by a slowdown in payment trades consistent with the weaker economic environment. Securitization income decreased 3% a higher finance charge and fee revenue driven by higher securitized loans and a lower cost of funds were more than offset by a higher write offs and a smaller increase in the valuation of our interest only strip this year versus last year which was mostly due to last year’s FAS 115 adoption gain. Card member lending finance revenue rose 19% on growth in the owned portfolio. Interest expense increased 9%. This was due to an 8% increase to funding costs within the lending business and a 10% increase within the charge card and other interest expense line. These increases reflect loan and business volume growth which was partially offset by the benefits related to the decrease in the LIBOR benchmark rate. Marketing, promotions, rewards and card member service expense increased 20% reflecting greater marketing investments versus a relatively low level of marketing last year as well as higher volume related reward costs. Human resource expense increased 13% reflecting last year’s pension gain, merit increase, greater benefit costs and a 4% higher employee level primarily related to various customer service and sales force related initiatives in addition to late year’s corporate travel acquisition. Growth in the remaining operating expense reflects the impact of increased volumes within our technology and card member servicing activities and shows that the underlying operating expense continued to be well controlled. The total provision for losses and benefit increased 48% versus last year as the charge provision rose 65%, the lending provision increased by 41% and the other provision was 61% higher. The lending and charge provision increased due to the higher write off rates and delinquency rates reflecting the more difficult US credit environment and loan and business volume growth worldwide. The other provision rose on greater merchant related provision in the first quarter of 2008 compared to the delta related provision benefit in the first quarter of 2007. The consolidated tax rate of 28% for the quarter reflects the resolution of certain prior year tax items compared to the 32% rate last year. With that, let me conclude with a few final comments. Business metric performance by growth in billed business and loan balances continued to be in the top tier of the industry. The GAAP between our growth rates and that of most major competitors demonstrates the effectiveness and ongoing benefit of our marketing and rewards investments over the past several years. Business growth also benefitted from the relatively strong growth in our global network services and our non-US consumer and commercial card activities reflecting the benefit of the diversity of our business segments and our business model and the balance within our results. While losses and past due levels within the United States lending portfolio have trended higher our credit quality indicators compare favorable to the industry and continue to reflect the benefits of our focus on the premium market sectors. As we’ve discussed before our write off rate calculations include principle, accrued interest and accrued fee versus the principle only calculation that our competitors generally publish and utilize. This serves to overstate our comparable rate by about 20%. Overall, our first quarter metrics demonstrates that the business performance was dimensionally consistent with the 2008 plan that we’d discussed with you back in January. We believe we are managing credit effectively in a difficult environment. Although are actions are compressing spending volumes somewhat and will negatively impact credit metrics in the near term. The managed US card member write off rate rose from 4.3% in the fourth quarter to 4.3% in the first quarter. I want to point out that the rate for March was higher than the average rate for the quarter. Therefore, we expect that the loan loss rate will be higher in the second quarter than in the first quarter. In addition to the combined impact of our actions and the current environmental conditions will likely cause loan growth to be slower than the 16% growth assumed in the initial plan. We do not plan to update our view of our metric trends as the continually evolve and will likely vary from our original plan assumptions as we progress through the year. However, our performance together with the flexibility inherent in our business model affirms our belief that we are still tracking to the reported EPS growth assumption of 4% to 6% that we discussed earlier in the year. This expectation is based on the economic environment that is consistent with or moderately worse than what we have experienced to date. If conditions were to significantly deteriorate from here we would likely be more focused on the medium to long term strength of the franchise versus our short term objectives. Our strategy continues to be centered on positioning us to continue to gain profitable share regardless of the environmental conditions. And, in light of this difficult environment we believe we are prudently balancing risk against profitability and growth. As we have discussed with you before, our ultimate goal is to continue to ensure that American Express navigates through these challenging economic conditions in the best position possible relative to our payment competitors and relative to the overall industry. We will continue to be guided by our long term, on average and over time financial objectives. Since we set these objectives in 1993 we have generally performed consistent with these goals and in fact, have outperformed them in recent years. Given our industry leading results and the products, customers and geographic breadth of our franchise we believe we are well positioned to execute against growth opportunities in a manner that continues to appropriately balance short, medium and long term business and financial goals. We are now ready to take questions.

(Operator Instructions) Your first question comes from Meredith Whitney - Oppenheimer. Meredith Whitney – Oppenheimer & Co.: One thing that really stuck with me at your semiannual meeting in February was the market decline you saw in consumer spending for the month of November to December. I know you said you didn’t want to do this but can you directionally comment on what you see in consumer spending? And, remind us, if you told us about the line issue in terms of cutting consumer credit lines, when that took place and if that’s accelerated throughout the quarter? Daniel T. Henry: We saw a 300 basis point drop in December in the US consumer and small business and as I indicated in the first quarter we had a 300 basis point drop across various lines of business in the US compared to the fourth quarter. I’m not going to give information month-by-month, I think that’s probably too detailed but I would say the 300 basis point drop first quarter to fourth quarter is consistent with what we saw in December, so we’re seeing a continuation of that. In terms of the line reductions that we’ve done with regard to certain lending customers, as soon as we saw the deterioration in credit we took a look at our credit policies and practices and we have heightened default rates across the board, we have also been surgical in terms of looking at certain geographies because default rates are higher in certain geographies. We’ve also looked at certain industries where they have weakness and in those we’ve taken special actions as well. So, as soon as we saw the credit indicators start to deteriorate which was back in December and we’ve continued that really through the first quarter in total. So, the number of line reductions in the first quarter was significantly more than we would have seen on average in 2007 and we’ve seen probably fewer line increases. We’re trying to be very focused on balancing and controlling credit properly. On the other hand we don’t want to damage the long term health of the business so really balancing long term considerations for customers with the desire to control credit in the short term. Meredith Whitney – Oppenheimer & Co.: You’ve seen a flurry of large caps like yourself change their funding strategy over the last few weeks or augment their funding strategy over the last few weeks. Could you update us as to any changes that you see? Any tweaks you’d like to make to your funding strategy and any changes you see to your securitization strategy? Daniel T. Henry: We really haven’t changed our strategy, we actually fund across a number of areas so we borrow in the commercial paper market, we borrow in the unsecured market and thirdly, we borrow through securitizations. So, there has been an absence of availability in the unsecured one to five year market really over the last six, seven or eight months. But, there has been perfect availability in commercial paper, we continue to fund there the way we always have and have not seen any price increases in that funding vehicle. We do have availability in the unsecured market, five to 10 years. Liquidity has been there for us and also there’s plenty of liquidity in the securitization market. Now, in the unsecure and the securitization market, we have seen the impact of what’s taking place in LIBOR impacting what we have to borrow at. Plus, the credit spreads above LIBOR in the first quarter were higher than we’ve seen historically. But, there’s plenty of liquidity, you have to pay up a little bit. One of the other things I’d say, just to point out to you, on our website we included on the website some information about the funding we’re doing, debt funding we’re doing. And, in there we indicated that we were going to fund this year $37 billion over the course of the year. In fact, because of the slowdown in the business, that’s now $34 billion. I’d point out that we funded about $7.8 of that in the first quarter and in the first 15 days of April we actually funded another $4.8. So, there’s been plenty of availability in terms of funding for us. We think we have a very strong liquidity plan and funding plan. We’re an A plus, a strong A plus rated company. I think we’re well regarded in the marketplace and we’ve been able to fund just find.

Your next question comes from Craig Maurer - Calyon. Craig Maurer – Calyon Securities (USA), Inc.: Looking at the increase in your marketing expense year-over-year could you comment on how much of that growth is related to higher rewards points accrual? Daniel T. Henry: Our rewards, we don’t split out those two numbers. I think historically we’ve given the dimensional split between marketing and rewards. I would say that our rewards costs have grown dimensionally in line with the growth in the business. The rest of the increase is really the fact that last year we took our marketing spending down which we explained at that time. This year we’ve brought it back up to more normal levels so the 20% increase on that line is a combination of volume related expenses on rewards plus higher level of marketing compared to the first quarter of last year. Craig Maurer – Calyon Securities (USA), Inc.: On the credit side, the reserve coverage ratio that you have in place right now which seems to be in line historically with where you’ve been, are we to assume that you’re going to maintain that similar level of coverage? Or, will that be increasing due to like you said March was the highest quarter? Daniel T. Henry: The reserve coverage of delinquencies in charge card is 96% this quarter compared to 95% last quarter. On the lending side on an owned basis the coverage ratio was 100% in the fourth quarter and is now 101% and if you look at lending on a managed basis it went from 106% to 105%. So, we’re keeping it in the first quarter at dimensionally a similar level that we had at year end. Where we’ll take reserve coverage in the future will depend upon the economy and the delinquencies that we’re seeing in our own business and what credit actions we’re taking. When you’re setting we also take in to consideration what your recent acquisitions have been so I think we’ll take all those factors in to consideration in the future in terms of where we’ll set our reserves and our coverage ratios. Craig Maurer – Calyon Securities (USA), Inc.: Have you thought about how the GE acquisition will affect that coverage yet? Daniel T. Henry: I don’t know the answer to that question. It’s about $4 billion of business so I don’t think it will have a dramatic impact on the overall ratios and we’ll make an evaluation what the appropriate coverage ratios are for that particular portfolio based on historical experience.

Your next question comes from Bob Napoli - Piper Jaffray. Robert Napoli – Piper Jaffray: On the funding side, can you quantify the percentage of your funding that is floating rate at this point and how much benefit you got? I understand your spreads were up and LIBOR is up and obviously the Fed has cut rates a lot more so you must be benefitting so I was just wondering if you could give a feel for how much benefit you’re getting from the interest expense side? And, I would imagine that you would expect that to somewhat offset the higher credit losses that you’re probably going to see this year versus your prior plan. Daniel T. Henry: Approximately 30% of our funding is fixed either because it’s fixed rate or it’s fixed through hedges. In the annual report I think we make a disclosure on as it relates to charge card or fixed rate lending products a 100 basis point drop in funding costs yields us about $225 million in benefit. Now, you’d have to think about our funding costs not just where the Fed has gone because it’s actually the LIBOR rate that’s key and you have to factor in where credit spreads and both LIBOR have gone. So, I think you need to think about all of those. As it relate to our variable rate book, I think you have to think about it a little differently because when we designed the product we really just want to lock in a spread and when interest rates go up or down that’s really the cost that gets passed on to the customer. And, inherent in there is there’s an assumption that there’s a relationship between Fed funds and LIBOR rates because we price to our customer off of prime which is driven by Fed funds. So now that LIBOR is not moving in concert with Fed funds, that has a negative impact on us and that’s moderating the benefit that we’re getting. So, over time it will be important for us to have Fed funds move back more in line with LIBOR rather move back more in line with Fed funds. So, we’re getting a benefit clearly but I think you have to factor in all the things I just discussed to fully understand what the impact will be and as we go forward to the rest of the year how much benefit we’ll get will also depend on the relationship of those two curves. Robert Napoli – Piper Jaffray: Is it your expectation though that that benefit is offsetting the higher provisions that you’ll likely have? Daniel T. Henry: I think interest rates as I think about our business to the extent you stay floating are always a built in hedge. So, if you actually have higher provision and slower growth and billings normally interest rates would go down and actually hedge that economic condition and we’re actually seeing that happen during the current period. Robert Napoli – Piper Jaffray: American Express is trading around 12 times earnings and you can argue that the earnings could be cyclically get impaired more than what the people currently have them modeled at, nonetheless it would be cyclically impaired to improve when the credit cycle improves. But, you have MasterCard and Visa trading at 25 times or 30 times earnings. You’re earning double what maybe a Visa might earn but have a lower market cap so that brings some strategic thoughts, it must or certainly discussions within American Express about what the right structure is and does the lending business have to be attached or should they be separated? I just don’t know if you can give any thoughts? I’d love to hear what thoughts you have on valuation of American Express versus competitors of yours in MasterCard and Visa. Daniel T. Henry: We certainly do discuss our PE, it’s something that we’re focused on because it’s an important part of our share price which is important to our shareholders. So, if you went back several months ago there certainly was a notable higher PE for us compared to the issuing competitors. When you think about our company I think you really need to think about the various elements of it because we do have some diversified businesses here. Within the issuing side, we have a charge card business which has less credit risk attached to it and I think probably deserves a PE that’s higher than the average of the industry. Obviously, you have a lending component of that but then our B-to-B business we have corporate services which certainly have less risk again, it’s a charge card company and should derive a higher PE from that. Then, we have our merchant business and G&S business which is much more analogous to either a processor such as First Date Resource or a network such as Visa and MasterCard. So, I think our PE over the years has reflected that. I think people need to focus on the fact that there are really several different elements to it. I think what we’re trying to do is to navigate through the short term here in the best possible condition, maintain our business momentum and come out of the slowdown in stronger position compared to our competitors and that we think if we do that that will be in the best interest of our shareholders and hopefully get reflected in our share price over time. In terms of lending, lending is a important part of our business. We put value proposition into the marketplace that we think customers want to use and then we let them decide whether they want to use a charge card or a lending product. The important thing for us is that it’s a spend focused card and that’s how we design our products. So, we think all pieces of our business is an important part and people should think about each of those components when they think about our evaluation.

Also if you looked at the performance of the company over the last really five to 10 years, the performance has been really very strong and consistent with, if not better than over recent years, our financial targets and I think the performance that we’ve been able to generate is clearly differentiated from most companies in the marketplace and hopefully that will give us some credit on the PE side over time.

Your next question comes from Sanjay Sakhrani - KBW. Sanjay Sakhrani – Keefe, Bruyette & Woods: So we should just think about the ‘08 guidance as being 4% to 6% EPS growth and not think about the charge off guidance and the worldwide billed business guidance you provided in January? Daniel T. Henry: That’s correct. Sanjay Sakhrani – Keefe, Bruyette & Woods: Just in terms of your expectations on credit quality when you mentioned in January and how things are progressing, I just want to know how the behavior has been across segments, vintages, etc. On the tax rate I just wanted to get a sense of what a good tax rate would be to use on a corporate level because it seemed like it was a little bit lower than what I thought it would be. Daniel T. Henry: On the spending side we’ve really seen in the US the slowdown really across all products, all vintages, and all geographies. On the credit side it’s been different, where we’ve seen the greatest impact are in geographies where the housing market has really dropped more than 5% or more than 10%. So, when we look at our data and we look at geographies that really have not had a drop in housing there really hasn’t been that much deterioration and where there’s been a greater drop, the greater the drop in housing prices the greater the change or deterioration in credit metrics. The other key thing that we’ve looked at is look at where people stand in terms of their mortgage. So, if you look at folks that are either renters or people who have had a mortgage that is older than 2003 again, it’s been relatively modest change in terms of credit behavior. On the other hand, if you look at folks who have a mortgage that is more recent than that or people where we don’t have mortgage information that’s where we’re seeing the greatest increase in delinquencies. That’s to give you an idea of how it’s different but it’s really different on the credit side as opposed to on the spend side. To answer your question about tax rate, I would generally think about a tax rate in the low 30% range, 30% to 32%. Over the last several quarter in certain quarters it’s been lower than that such as this quarter and that’s really driven by the fact that we’ve settled and resolved certain prior period tax issues that resulted in the benefit to us and therefore it lowers the tax rate in the period that’s settled. Sanjay Sakhrani – Keefe, Bruyette & Woods: So, for the remainder of the year 30% to 32% is a good run rate to use quarterly? Daniel T. Henry: I won’t do a forecast on the rest of the year but I would think absent some settlements related to prior years that 30% to 32% rate is about the right run rate. Sanjay Sakhrani – Keefe, Bruyette & Woods: Just one more question on that credit color, how about small business? That’s an area that we’ve heard some of your competitors talk about seeing quite a bit of deterioration. I’m wondering if I could just get some color on that. Daniel T. Henry: In some prior periods we’ve said small business was a leading indicator that credit was going to deteriorate. That wasn’t the case this time. We should keep in mind that small business just by the nature of the business has higher credit losses in good times or bad times than consumer. But, what we’ve seen so far is both a similar impact to both consumer and small business during the cycle in terms of our card members. Now, in terms of our merchant business we actually had some higher provisions in this quarter in part because some of the small businesses that are merchants we’ve seen some impact there and so we set up reserves to cover ourselves on the merchant side.

Your next question comes from David Hochstim - Bear Stearns. David Hochstim – Bear Stearns: Did you explain or divest what the investment losses that were in the corporate segment were this quarter? Daniel T. Henry: As part of the sale of AEB to Standard Chartered, part of that was an agreement that we would continue to own AEIDC which was a subsidiary in which they actually had investments and then deposits really from customers where they invested money and made payments to customers, we would hold that for 18 months past the time of the closing. In the first quarter we actually had about $100 million of losses related to that AEIDC portfolio. Now, when we first took the portfolio we had about $4 billion worth of investments in mortgage backed and other asset backed investments and we took that down to about $1.6 billion as of yearend and we’ve now taken it down to I think $783 million. So we’ve really reduced our exposure within that portfolio. 93% of the assets within the remaining portfolio are AAA rated. That probably gives us less comfort than it used to but basically that $100 million loss that we had in the first quarter we’ve made into that portfolio. David Hochstim – Bear Stearns: Was that a realized loss or mark-to-market? Daniel T. Henry: A combination of both. David Hochstim – Bear Stearns: And so were there other unrealized losses that haven’t been marked-to-market? Daniel T. Henry: The mark-to-market was the vast majority of it. David Hochstim – Bear Stearns: You said you’re not providing guidance, but in January you did talk about a 5.1% to 5.3% charge off range for the year and you indicated you were above that now. Is there some relationship we should think about between billed business growth and that loss rate? Billed business was a little bit higher than I think you thought in the first quarter. Daniel T. Henry: Certainly billed business was a strain in the fourth quarter and then it was higher than the full year guidance that we indicated. In terms of billed business we continue to be very cautious in terms of our outlook as it relates to US. On the other hand we’re encouraged by the performance internationally. So we’ll have to see how that plays out. Again, I think our performance compares very favorably to competitors. On the credit side, as I said, we came in at 5.3 for the quarter and we expect that be higher in the second quarter. Where credit will go after that is very dependent on a combination of the economy and what business actions we take in the future. David Hochstim – Bear Stearns: Is there a reason to think that it won’t go? Shouldn’t we expect it to go higher when we look at the delinquency trends? Those moved up pretty significantly in the first quarter as well. Daniel T. Henry: Yes, and I think that’s why we’ve indicated that the second quarter will be higher than the first quarter in delinquencies. A large part of the delinquencies will play out in the second quarter. But what happens to those people who are current or only 30 days will be very much driven by what happens in the economy. David Hochstim – Bear Stearns: And did you see any change in roll rates in the quarter relative to the fourth quarter? A significant change? The later stage buckets? Daniel T. Henry: You can see that just total delinquencies are higher in the first quarter than they were in the fourth quarter. We don’t really give out disclosures, bucket by bucket. David Hochstim – Bear Stearns: Right, that’s why I was asking. Daniel T. Henry: No, we don’t disclose that.

Your next question comes from Brad Ball - Citi. Brad Ball – Citigroup: Dan, that you did say in your prepared comments that you’re seeing slower payment rates and in response to an earlier question you were talking about seeing more credit deterioration in the markets where home prices have dropped 5% to 10%. Are those things what’s accountable for the change in credit results versus what your outlook was back in January? Daniel T. Henry: Certainly payment rate is slowing down. I don’t know it by geography but I think it’s probably reasonably broad based. There’s lots of things we can do in terms of how much we allow people to spend, but it’s completely up to them in terms of how much they decide to pay. We’ve actually had a nice move in terms of the growth in managed, they are in the US. It dropped from 23% growth in the fourth quarter down to 18% growth. We think that’s a good trend given the environment that we’re in. But I don’t have specific information on pay downs as it relates to geographies. Brad Ball – Citigroup: And then a follow up on the comments you made earlier about the $34 billion of funding in ‘08, is that all expected to be done in the ABS market and what pricing are you seeing on ABS deals these days versus where they were a year ago and where would you expect them to normalize and any idea when? Daniel T. Henry: I don’t have any idea when, that would be nice to know that I think. Lots of people would like to know the answer to that question. We don’t fund solely in the securitization sector. It’s really a combination of commercial paper, unsecured debt and securitization. In the first quarter and in the first two weeks of April, we actually borrowed certainly in the commercial paper market but we also did a number of ABS transactions. In January we did about $3.7 billion of ABS, but we also did about $3 billion of unsecured and if you look at what we actually did in April, again it was a combination of ABS transactions where we did about $2.5 billion. We also did another $2.5 billion approximately in unsecured. So we really continue to borrow through each of those channels as we have historically. Brad Ball – Citigroup: And where is the pricing on those? Daniel T. Henry: The pricing is certainly higher than what we saw historically. Often we were paying 10 to 20 basis points above LIBOR. Back in early January on a three year deal we paid 45 basis points above LIBOR. In February on a 10-year deal we did 126 basis points above LIBOR. Then in April they came back a little bit. We did two year ABS at 95 basis points above LIBOR. We did a six year deal at 140 basis points above LIBOR and then we did a one year deal at 70 basis points. It really depends on the maturity or the length the debt is going to be outstanding, but I would say its come back a little bit in April compared to where we were in the first quarter.

Your next question comes from Eric Wasserstrom - UBS. Eric Wasserstrom – UBS: You said your expectations at this point are based on an economy that looks similar to ours or maybe moderately worse, but would you mind just quantifying what that means in terms of nominal GDP and unemployment? Daniel T. Henry: I wouldn’t try to put either an unemployment number on significantly or a GDP number. I think certainly if unemployment moves up a little bit or GDP slides a little bit, I think we would say with our current thoughts about where we’re tracking in terms of EPS. If they were to move notably, and I’m not going to put a percentage on that, then that will have an impact on our business decisions and at that juncture we’d have to decide is the correct thing to do is to pull back on spending and continue to track towards 4% to 6% or should we be more focused on continuing to spend at comparable levels, move away from that EPS number and be more focused on continuing to have strong business momentum. No matter what the facts are we’ll be very focused on continuing the business momentum we have and investing at a level that will enable us to continue to take share just as we have over the last several years. Eric Wasserstrom – UBS: Could you just help me to think about how as an outside observer of the company we can make a judgment about whether the broader economy is moving in ‘08 that’s consistent with your expectations or perhaps worse than? Daniel T. Henry: I’ve tried to indicate that I’m not an economist; we don’t have any economists at American Express so I really don’t try to forecast where the economy is going. What I try to do is set up a plan based on a certain set of economic assumptions and then we have a contingency plan, either positive or negative depending on which way the economy moves. Now we could take a very dire forecast of the economy and really pull back on spending now. We’ve chosen not to do that because if it doesn’t really move down, then we would have missed the business opportunity. I think the thing that’s important is us to know what actions we’ll take to either spend more money or less money, depending on where the economy goes, and be ready to move quickly in that direction. And we have those plans. I’m not trying to forecast the economy, but I’m ready for a variety of scenarios so that we can operate in the most positive way going forward. Eric Wasserstrom – UBS: If things were to get worse, what would be the first two actions that you would look to take? Daniel T. Henry: We have a variety of actions that we could take including how much spend on marketing, how much we spend on technology, how much we spend on consultants, contractors, just a lot of overall operating expense levels would be. So those are all things that we’ll consider, but we don’t consider them in isolation. We have to consider them in terms of if we take those actions, what will be the impact on mid-term metrics and the mid-term health of the business and we’ll factor all those things together in determining whether we actually reduce expenditures or whether we decide to stay where we are or increase them. Another barometer is just what we’re doing with credit, right? Depending on where the economy goes we could tighten up on credit further, we may assess that at this point it’s better to actually loosen up on credit and let more billings come through. Our total objective will never be just one line item in the P&L; our objective is not to have, for instance, the lowest possible provision rate. It’s really to make decisions that have the greatest economic gain over time.

Your next question comes from Mike Taiano - Sandler O’Neill. Mike Taiano – Sandler O’Neill & Partners L.P.: Dan, how should we view the $70 million payment that you received from Visa this quarter? Should we just assume that that was reinvested in the marketing line? Daniel T. Henry: Visa’s payments that we’ll receive for the next four years we really consider to be part of ongoing operations. In some quarters, we’ll fully reinvest it, on others we won’t. In the first quarter we came into the year really very cautious about what was going to take place. We actually only approved certain limiting spending against that $70 million. We were actually comfortable doing that because as part of our regular plan we had planned to actually increase marketing expense quite a bit compared to last year. Each quarter we’ll make an evaluation about how much we’ll spend. We have already approved some spending over the balance of the year of those Visa funds and then after that each quarter we’ll make an evaluation of whether we’re going to approve more of that for investment spending. Mike Taiano – Sandler O’Neill & Partners L.P.: Could you give us a little bit of color on what’s going on with the utilization rates on both consumers and small businesses? Are you seeing those utilization rates going up over the last three to six months, let’s say, or have they been basically stable? Daniel T. Henry: Utilization rates are curious. Customers self regulate themselves. Customers generally only like to take their line to 50%, 60%, and 70% of their total line. I think they always like to keep some for a rainy day. Quite frankly when someone hits their line, that’s an indicator to us that we need to be very cautious about them in terms of payment behaviors and whether we consider actually increasing the line or not. I don’t know that we’ve seen a marked change in the utilization percentage. Certainly the extent we’ve reduced lines on people, that clearly has had an impact to help our credit, but it’s probably also had an impact in terms of reducing spending in the first quarter in those categories where we’ve actually reduced lines. Mike Taiano – Sandler O’Neill & Partners L.P.: Where do you stand with what’s going on with the airlines? Are you withholding more cash these days given the high price of oil and some airline bankruptcies? Daniel T. Henry: We evaluate all airlines on an individual basis. They are very big customers of ours. We have exposure because to the extent a card member buys a ticket that card member pays us, we pay the airline and to the extent they’re not going to fly for a week or two months during that time we basically have frankly a receivable from that airline but if they were to liquidate we wouldn’t collect it. Over the years we’ve been very focused on this. When appropriate we do hold back to mitigate whatever exposure we have. Over the years, from time to time, we’ve had small losses, but we’ve never had any large significant losses in the airline industry. We don’t have a blanket policy, it’s airline by airline.

Your next question comes from Moshe Orenbuch - Credit Suisse. Moshe Orenbuch – Credit Suisse: You said that the expectation was for higher losses but similar earnings, would you say that the steps that would be needed to offset those higher losses already were taken in the form of falling interest rates or do you have to make changes in a marketing front on top of that? Daniel T. Henry: I didn’t make any forecasts for the full year as it relates to credit losses. I simply indicated that in the second quarter we think write off rates are going to be higher than they were in the first quarter. Our assessment of the full year and tracking to the 4% to 6% takes into effect everything that’s happening, from billings, from fees, finance charge revenue, interest rates, investment spending, operating expenses. We factor all those things together. We’re believe we’re still tracking to the 4% to 6% EPS for the year.

You follow up question from Meredith Whitney - Oppenheimer. Meredith Whitney – Oppenheimer & Co.: You say you don’t have internal economists yet the external economists and whatnot are known to call you and ask for guidance. Wouldn’t you have ability to see from a behavioral standpoint further out into a couple of quarters and comment on that? And then with respect to the guidance on the losses, the losses are accelerating, so why would you assume that they would do anything other than stabilize at best if not accelerate further as the core fundamentals in the environment deteriorate? Daniel T. Henry: We certainly have a very good window within the quarter about what’s taking place, not only month by month, but day by day and we can see what the trends are and from that we can have a window a little bit into the next month or two. What’s going to happen beyond that is going to be very dependent on what customers’ view of the economy is as opposed to our view of the economy. So it’s really going to be their behaviors that are going to impact it. We have a little bit of a window, but I don’t think it’s a long term window that expands to the third quarter or the fourth quarter. On that basis, all of the decision we make we take into consideration everything that we know, but we don’t have an economist in house and we’re really picking a scenario around which we plan and then we have contingency plans either up or down around that. In terms of credit losses, as I said, the launch is higher than the average. We have a view of what’s going to happen in the second quarter because of roll rates in terms of what’s being placed there, most likely to happen in the second quarter, but once you get beyond that it gets a lot more difficult because if you’re going to have high delinquencies out there, it’s going to be based on the behavior of the customers that are currently either current or 30 days and only time will tell what their performance is actually going to be. Meredith Whitney – Oppenheimer & Co.: The bigger wild card is spending and the shortness of your, if it goes beyond 30 days do you know where it’s going? Daniel T. Henry: In the very near term we know where it’s going. We certainly also listen to all the external information that’s out there and what economists are predicting. But as we know today there are one group of economists that have a very dire forecast and there’s another set of economists that think the slowdown is only going to last for a short period of time. It’s hard to figure out which is actually going to be the case.

There are no other questions in queue. Daniel T. Henry: Let me just share a few final thoughts before we sign off which is despite the more difficult environment we generated strong business growth during the quarter and metric performance is in the top tier of the industry. While we continue to be cautious about the US economy we believe we are prudently balancing risk against profitability and growth. Our goal is to ensure that American Express navigates through these challenging conditions and emerges on a stronger footing relative to the competition. Thanks everyone for joining us and I look forward to speaking with you in the future.