Log in
E-mail
Password
Remember
Forgot password ?
Become a member for free
Sign up
Sign up
Settings
Settings
Dynamic quotes 
OFFON

MarketScreener Homepage  >  Equities  >  Nyse  >  American Express Company    AXP

AMERICAN EXPRESS COMPANY (AXP)
My previous session
Most popular
  Report  
SummaryQuotesChartsNewsRatingsCalendarCompanyFinancialsConsensusRevisions 
News SummaryMost relevantAll newsOfficial PublicationsSector newsTweetsMarketScreener Strategies

American Express : China Approves American Express Card Service, Addressing U.S. Concerns About Markets

share with twitter share with LinkedIn share with facebook
share via e-mail
0
11/09/2018 | 01:50pm CET

By Lingling Wei and Chao Deng

BEIJING -- American Express Co. won approval to set up card-clearing services in China -- the first U.S. card network to gain permission -- as Beijing seeks to show progress in opening its markets ahead of a summit between the Chinese and U.S. presidents.

The approval, announced Friday by China's central bank, comes more than a decade after Beijing promised to open the sector and more than a year after it pledged anew to do so -- part of a package meant to forestall the tougher trade measures President Trump has since imposed.

With the permission, AmEx will form a 50-50 joint venture with Chinese fintech firm Lianlian Group to set up the payment network. More hurdles await: After building the network, the venture will need a separate approval for a business operating license. Chinese regulators give AmEx up to 15 months to build the clearing network, said AmEx spokesman Fritz Quinn. He said the company would work with that timeline.

Once running, the AmEx network will join a market with nearly 7 billion bank cards in circulation, with government-owned China Union Pay Co. commanding more than 90% of the market. Mastercard Inc.'s application for a similar joint-venture is pending, as is Visa Inc.'s to form a wholly owned entity in China.

Beijing and Washington are looking to the meeting between presidents Xi Jinping and Donald Trump at the end of the month to ease a trade conflict that has battered global businesses and investors as well as damaged the bilateral relationship.

Approval of the AmEx deal was timed to get out ahead of that summit, a Beijing official said. He called it a "goodwill gesture." In its announcement, the People's Bank of China said the permission represents "an important step" toward liberalizing China's clearing industry.

So far, on-and-off trade negotiations have shown scant progress. The U.S. has placed punitive tariffs on more than half its Chinese imports and is threatening penalties on the rest. Meanwhile, China, which imports far less, has slapped tariffs on about 80% of its American imports. Washington has been reluctant to resume the talks until the Chinese side presents a concrete proposal to address the Trump administration's complaints about market access, forced technology transfer and other economic issues.

The AmEx venture and the years it took to get there illustrate many of the Trump administration's criticisms about Chinese trade practices.

AmEx's decision to take on a Chinese partner, instead of forming a wholly owned entity, shows the difficulties foreign firms face in going solo in a market where the government holds sway, said analysts and industry experts. Barriers to foreigners have been high for so long that Chinese institutions dominate many sectors, especially in finance -- be they for payment services, credit rating, brokerages or banking -- sectors where China has said greater foreign participation would be allowed.

In April, People's Bank governor Yi Gang pledged by the end of June to remove the current 49% ownership cap on foreign securities firms' mainland joint ventures. Even so, Chinese regulators have yet to approve any foreign firms' applications, including ones from Switzerland's UBS Group, Japan's Nomura Holdings and the U.S.'s JPMorgan Chase & Co.

For the banks, one hurdle is a requirement that majority owners have at least 100 billion yuan ($14.4 billion) in net assets. Another obstacle, according to a lawyer who advises foreign brokerages: finding financial industry executives that meet Beijing's qualifications, including passing securities exams written in Mandarin.

Joint ventures, like the one being formed by AmEx, have drawn particular ire from some Trump administration officials who see them as a tool China uses to reduce American companies' profits and siphon off their technical know-how.

AmEx has worked with its Chinese partner, Lianlian, as far back as 2012, providing technology to power Lianlian's digital wallets, which Chinese consumers can use to top up mobile phone minutes and pay bills with. Mr. Quinn, the AmEx spokesman, said the firm will have control over the business of the joint venture as stated in its agreement with Lianlian.

Write to Lingling Wei at lingling.wei@wsj.com and Chao Deng at Chao.Deng@wsj.com

share with twitter share with LinkedIn share with facebook
share via e-mail
0
Latest news on AMERICAN EXPRESS COMPANY
09:33aAPPLE : Colluding Banks Allegedly Slowed Apple Pay Switzerland
AQ
11/17Visa Confirms Brazilian Regulators Are Investigating Payment Companies -- Upd..
DJ
11/17Visa Confirms Brazilian Regulators Are Investigating PaymentCompanies
DJ
11/15AMERICAN EXPRESS CO : Regulation FD Disclosure (form 8-K)
AQ
11/15AMERICAN EXPRESS : Travel Unveils Its Top Trending Travel Destinations for 2019
PU
11/15AMERICAN EXPRESS : Launches American Express : GoTM , a New Virtual Payments Off..
BU
11/13CYPRUS : Government to call for tenders for credit card clearing agencies
AQ
11/13AMERICAN EXPRESS : and National Trust for Historic Preservation Award $450,000 i..
BU
11/13AMERICAN EXPRESS : Chief Executive Officer to Participate in the Goldman Sachs U..
BU
11/13ANOTHER REASON TO SHOP SMALL® ON SMA : Approximately 67 Cents of Every Dollar Sp..
BU
More news
News from SeekingAlpha
11/15Tracking Warren Buffett's Berkshire Hathaway Portfolio - Q3 2018 Update 
11/15American Express October delinquency rate improves M/M 
11/15American Express launches virtual payments product 
11/15Tracking Gardner Russo & Gardner Portfolio - Q3 2018 Update 
11/12Tracking Dan Loeb's Third Point Portfolio - Q3 2018 Update 
Financials ($)
Sales 2018 40 428 M
EBIT 2018 11 706 M
Net income 2018 6 352 M
Debt 2018 -
Yield 2018 1,35%
P/E ratio 2018 14,85
P/E ratio 2019 13,47
Capi. / Sales 2018 2,31x
Capi. / Sales 2019 2,15x
Capitalization 93 507 M
Chart AMERICAN EXPRESS COMPANY
Duration : Period :
American Express Company Technical Analysis Chart | MarketScreener
Full-screen chart
Technical analysis trends AMERICAN EXPRESS COMPANY
Short TermMid-TermLong Term
TrendsBullishNeutralBullish
Income Statement Evolution
Consensus
Sell
Buy
Mean consensus OUTPERFORM
Number of Analysts 31
Average target price 115 $
Spread / Average Target 4,9%
EPS Revisions
Managers
NameTitle
Stephen J. Squeri Chairman & Chief Executive Officer
Jeffrey C. Campbell Chief Financial Officer & Executive Vice President
Marc D. Gordon Chief Information Officer & Executive VP
Charlene Barshefsky Independent Director
Peter F. Chernin Independent Director
Sector and Competitors
1st jan.Capitalization (M$)
AMERICAN EXPRESS COMPANY10.22%93 507
CAPITAL ONE FINANCIAL CORPORATION-11.99%41 511
DISCOVER FINANCIAL SERVICES-8.06%23 759
ORIX CORPORATION-7.42%21 102
BAJAJ FINANCE37.10%19 239
SYNCHRONY FINANCIAL-32.89%18 622