Continuing to reap the rewards of product introductions, American Express Co.'s Travel Related Services unit reported a 10% rise in fourth- quarter earnings, to $328 million.

Volume on American Express cards was up 13%, to $40.7 billion.

"This was a very solid quarter," said Susan Roth, an analyst at Donaldson, Lufkin & Jenrette. American Express "has consistently delivered revenue growth above my expectations."

The New York company said its cardholders are spending more. Cards in circulation increased 3% worldwide, to 42.7 million, and 1% in the United States, to 29.6 million.

Total card loans increased 14.3%, to $14.6 billion.

PaineWebber analyst Gary Gordon said card spending is "the big driver" of growth. "They are earning their money as a transactor."

Revenues derived from merchants were up 11%, to $1.5 million. Chargeoffs, however, were high at 6.3%, compared with 5.2% a year earlier. Chargeoffs did improve slightly from the third quarter's 6.5%.

American Express is adequately covered for loan losses, Ms. Roth said. Reserve coverage remains well above average, at 132% of past-due accounts.

-Lisa Fickenscher

Providian Financial Corp. attributed a strong fourth-quarter performance to interest and fee-income growth.

The San Francisco-based credit card lender netted $54 million, 24% more than in the year-earlier period.

Earnings for the year rose by 26%, to $191.5 million, and to $2 a share, from $1.62.

Shailesh J. Mehta, chairman and chief executive officer, said he was "very pleased" with the results.

The net interest margin rose 34 basis points, to 11.23%. Net interest income topped $1 billion, 23% more than in 1996.

Fee income doubled to $460 million, spurred by 84% growth in secured card loans, to $858 million.

In the traditional credit card portfolio, receivables rose 1.3%, to $8 billion.

Providian is "very disciplined with their market and able to generate more with receivables on their books," said Susan Roth, an analyst at Donaldson, Lufkin & Jenrette.

But she said Providian faces a challenge in repricing the $1.1 billion of unsecured receivables it bought from First Union Corp. of Charlotte, N.C. "It's always a challenge to raise prices," she said. "You are contending with a competitive marketplace."

Net credit losses on managed loans increased to 6.42% in the fourth quarter, from 5.06% a year earlier.

-Charles Keenan

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