Still known to consumers primarily for its trademark card business, American Express Co. is ratcheting up its efforts to use this brand identity to push its other financial service capabilities to retail customers.

The New York company’s brokerage business, American Express Financial Advisors, which manages and administers $293 billion of assets in the United States, has been very successful. And the parent company now is looking to duplicate this success in its banking strategy.

American Express is a relative youth in the U.S. retail banking community. It has operated its online banking service, dubbed Membership Banking, since July 1999 for cardmembers but has had an international banking presence since 1919.

Previously focused on a corporate strategy, the international American Express Bank now employs 3,700 people in 38 countries and is being remade as a retail institution, according to James M. Cracchiolo, group president of the company’s global financial services unit, which includes both banking and brokerage.

During the last two years, American Express has pared its corporate loan portfolio overseas, said Mr. Cracchiolo. “We’ve moved a lot more of our loan book to personal lending on an international level,” he said.

The company has made substantial progress on that front. During 1999 it cut its corporate loan portfolio by 20%, to $3.2 billion, while increasing the consumer loans on its books to $1.9 billion, from $1.6 billion.

But the company doesn’t plan to abandon its corporate client base, Mr. Cracchiolo said. “We will continue to do lending to accommodate some key customers,” he said.

To help reshape its banking arm, American Express will look to increase its private-client business overseas, where it manages about $10.9 billion. This asset base has grown roughly 20% a year recently, the company said.

And though it does not offer private banking in the United States, the idea is something being kicked around by executives, Mr. Cracchiolo said.

“There’s a number of different things we’re looking at, and that’s one of them,” he said.

The desire to tap affluent customers is understandable, said Bryan Paul, an equity analyst at PNC Advisors.

“It’s a hot place where all the banks have been looking to go,” he said. American Express could use its brokerage business as a springboard into the affluent market, Mr. Paul said, but it would face a lot of competition.

Mr. Cracchiolo said leveraging existing customers is something that American Express is keen to do. And in his relatively new role as head of global financial services, Mr. Cracchiolo is charged with getting the word out internationally and domestically about American Express’ menu of financial services. He took the role in June when president and chief operating officer Kenneth I. Chenault, the heir-in-waiting to chairman and chief executive Harvey Golub, reorganized the business into four units.

“We think there’s a strong desire from our customers to get other products from American Express,” he said. On the investment side about 40% of its 500,000 brokerage customers were drawn from its U.S. cardmembership.

Mr. Cracchiolo declined to disclose just how successful the company has been in leveraging customers for its online bank domestically. With 50.4 million cards in circulation worldwide, 32.9 million of them in the United States, the company has a huge potential audience for its growing menu of traditional banking services, such as ATMs, checking and money market accounts, lines of credit, mortgages, and property and casualty insurance.

The company’s domestic consumer strategy is being played out in the shadow of the Justice Department’s antitrust lawsuit against Visa and MasterCard. The suit alleges a monopoly by the two giant card associations on relationships with U.S. banks, which prevents the latter from offering both the associations’ cards and Amex cards.

If the Justice Department rules against the two card giants, American Express would in theory gain greater access to people’s checking accounts.


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