Rapid-Growth Pangs Hit AmEx

This category -- which is generally considered to be people who have defaulted and are no longer delinquent -- stood at 0.06% of all accounts in the first half of this year, up slightly from 0.05% at year-ends 2007 and 2006.

The more interesting piece of the trust data is the average loan balance of the people who are delinquent for 151 days or more.

For the first six months of this year, that amount equaled $9,800. That's up from $6,767 at year-end 2007 and $4,062 at year-end 2006.

With the balances higher, American Express now faces higher charge-offs in the event of default.

These higher balances directly relate back to the growth in American Express' decision to let more and more of its consumers roll over their balances each month over the past few years.

American Express' overall portfolio growth was "way above the rest of the industry," says Michael Taiano, an analyst with Sandler O'Neill & Partners.

"One can question whether some of that growth was prudent now in retrospect," he says.

While the weak economy is surely to blame for some of American Express' problems today, it's also obvious the company needs to look at its own growth iniatives for some of its problems.