AMERICAN Express’s first-quarter profit vaulted past Wall Street estimates on Friday (Apr 19), driven by an affluent customer base that increased spending as recession fears ebbed.

Amid a turbulent landscape in which concerns over the financial well-being of lower-income consumers have troubled several lenders, American Express’s clientele has shielded the company from significant impact and left it largely unscathed by the challenges that hurt others in the industry.

The New York-based company reported a profit of US$3.33 a share for the three months ended Mar 31, sailing past analysts’ average expectation of US$2.96 a share, according to LSEG data.

“We’re seeing a lot of growth, especially on the consumer side,” chief financial officer Christophe Le Caillec told Reuters on a call.

Gen Z and millennial customers accounted for more than 60 per cent of new account acquisitions globally in the quarter, the company reported.

Net Interest Income (NII), the difference between income earned on loans and paid out on deposits, grew 26 per cent, to US$3.77 billion, while billed business rose 6 per cent, to US$367 billion in the first quarter.

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While most US lenders have expressed optimism about the resilience of American consumers so far, 11 rate hikes by the Federal Reserve over the last two years have made them susceptible to default risks and they have responded by raising provisions.

AmEx built US$1.3 billion in provisions for the first quarter, compared with US$1.1 billion a year earlier.

Still, the credit card giant has been immune to changes in spending and has downplayed worries of an economic slump for the last two years, bucking a larger trend of consumer softness expectations.

For the full year, the company maintained prior revenue growth expectations of 9 per cent to 11 per cent and a profit forecast of US$12.65 to US$13.15 a share, it said in a statement. REUTERS