American Express Hits Number

Updated from 1:55 p.m. EST

American Express

(AXP) - Get Report

reported fourth quarter profits that largely matched Wall Street's diminished expectations Monday.

In the quarter, the New York financial services firm earned $745 million, or 59 cents a share, compared to $896 million, or 71 cents a share, in the year ago period.

Much of the 16% decline in net earnings was due to last year's spinoff of American Express' financial planning operation, now called

Ameriprise

(AMP) - Get Report

.

On an operating basis, which excluded the financial planning division, American Express earned $751 million, or 60 cents in a quarter, compared to $669 million, or 53 cents, a year ago.

Analysts, as surveyed by Thomson Financial, had expected operating earnings of 59 cents a share.

The company

warned in November that the flood of personal insolvencies ahead of a new bankruptcy law would hurt the quarter's performance. In the quarter, the company's provision for credit losses, largely because of the new law, rose 34% to $813 million.

Revenue at American Express came in beneath expectations, rising 9% to $6.44 billion. Analysts were looking for revenues of $6.83 billion.

Expenses rose 10% to $5.5 billion. Much of the increase was due to an 11% rise in spending on marketing and promotions, which totaled $1.58 billion.

In midday trading, shares of American Express were up 48 cents, or 1%, to $51.88. The stock had been trading a bit higher in advance of the earning announcement, which was release shortly after 1 p.m.

In the quarter, discount revenue, which represents the money American Express makes from its main card business, rose 12.7% to $3.17 billion. Finance charge revenue 25% to $703 million

Return on equity, a measurement of a firm's ability to generate earnings, in the quarter was 25%, up from 22% a year ago.