THE NEWS: American Express Co.'s third-quarter net income soared 71 percent as its card holders spent more and it wrote off fewer unpaid balances.
THE CONTEXT: The company's customers tend to be more affluent than the general population, but Chairman and CEO Kenneth I. Chenault said the balances customers carried from month to month remained below levels seen before the recession "as cardmembers continued to manage their finances carefully and pay down outstanding debt."
THE POSITIVE SIGN: American Express said its write-off rate dropped below 5 percent of balances for the first time since early 2008. It is the lowest in the industry. Because the level of balances it's giving up trying to collecting is falling, the company was able to slash the money it set aside to cover bad loans by 68 percent to $373 million, from $1.18 billion a year ago.