American Express

(AXP) - Get Report

moved a step closer toward repaying government funds on Monday, saying it has begun an offering of up to $575 million worth of stock.

The credit-card company is offering $500 million to the public, while granting underwriters an option to purchase an additional $75 million of stock.

AmEx said it will use the capital toward "general corporate purposes" which may include the repurchase of $3.4 billion worth of the Treasury Department's preferred shares. AmEx issued those shares to the Treasury through the Capital Purchase Program, which was meant to restore the balance sheets of financial firms through the financial crisis.

AmEx said last month that it was seeking permission to repay the funds after a government stress test showed the company had adequate capital to weather a more severe economic storm. AmEx said the

Federal Reserve

, which administered the stress test, set an equity raise as a precondition to repurchasing the CPP stock.

"We've always viewed the Capital Purchase Program as a temporary program and are pleased to be in position to repurchase the preferred shares issued to the Treasury," Chairman and CEO Kenneth I. Chenault said in a statement.

AmEx shares closed up 4.6% at $25.99.