American Express Co.'s fourth-quarter profit nearly tripled from a year earlier, to $707 million, as credit costs declined sharply and consumer spending picked up, the company said Thursday.

The $124 billion-asset New York company set aside $748 million during the period to cover potential loan losses, down by almost half from a year earlier.

The rate of loan losses in the U.S. card unit dropped for a second straight quarter, falling 140 basis points from the third quarter, to 7.5%. This was the lowest since the fourth quarter of 2008, when the chargeoff rate stood at 6.7%.

Purchases on American Express cards in the U.S. climbed 2% from a year earlier, to $115 billion, and average spending per card rose 13%, to $3,321.

Earnings per share totaled 60 cents, slightly better than the average analyst estimate of 57 cents, according to Thomson Reuters.

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