American Express’ first-quarter profit missed Wall Street estimates on Thursday (Apr 20) as the credit card giant set aside more money to cover potential losses stemming from cardholders falling behind on their debt repayments.

The growing economic uncertainty in the United States has slowly begun to catch-up with AmEx, which has so far been in a relatively better position compared with peers due to its wealthy customer base.

A persistently high inflation and a rapid rise in borrowing costs have begun to pinch customers, resulting in AmEx raising its provisions to US$1.1 billion in the quarter, compared with a benefit of US$33 million a year ago.

Its profit fell 13 per cent to US$1.8 billion, or US$2.40 per share, for the three months ended March 31, missing analysts’ average estimate of US$2.66 per share, according to Refinitiv data.

Total revenue, excluding interest expense, rose 22 per cent to US$14.38 billion. REUTERS