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    &lt;div align="justify" style="font-size: 10pt; margin-top: 10pt; margin-left: 4%"&gt;&lt;u&gt;&lt;b&gt;Recently Issued Accounting Standards&lt;/b&gt;&lt;/u&gt;
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    &lt;div align="justify" style="font-size: 10pt; margin-top: 10pt; margin-left: 4%"&gt;The Financial Accounting Standards Board (FASB)&amp;#160;recently issued the Accounting Standard Update No.
    2010-20&amp;#8212;Receivables (Topic 310): Disclosures about the Credit Quality of Financing Receivables and
    the Allowance for Credit Losses. This standard amends existing guidance by requiring an entity to
    provide a greater level of disaggregated information about the credit quality of its financing
    receivables and its allowance for credit losses. In addition, an entity will be required to
    disclose credit quality indicators, past due information, and modifications of its financing
    receivables. The amendments that require disclosures as of a balance sheet date are effective for
    December&amp;#160;31, 2010. The amendments that require disclosures about activity during a period are
    effective for periods beginning January&amp;#160;1, 2011. The new
    standard is anticipated to require expanded disclosure by the Company due to the requirement for further disaggregation of
    currently disclosed information, as well as new disclosure requirements surrounding reserve
    activity.
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    &lt;div align="justify" style="font-size: 10pt; margin-top: 10pt; margin-left: 4%"&gt;Effective January&amp;#160;1, 2010, the Company adopted Accounting Standards Update (ASU)&amp;#160;No.&amp;#160;2009-16,
    Transfers and Servicing (Topic 860): Accounting for Transfers of Financial Assets and ASU No.
    2009-17, Consolidations (Topic 810): Improvements to Financial Reporting by Enterprises Involved
    with Variable Interest Entities (generally referred to herein as new GAAP effective January&amp;#160;1,
    2010). These standards eliminate the concept of a qualifying special purpose entity (QSPE),
    therefore requiring these entities to be evaluated under the accounting guidance for consolidation
    of variable interest entities (VIEs). In addition, ASU 2009-17 requires an entity to reconsider its
    previous consolidation conclusions reached under the VIE consolidation model, including (i)&amp;#160;whether
    an entity is a VIE, (ii)&amp;#160;whether the enterprise is the VIE&amp;#8217;s primary beneficiary and (iii)&amp;#160;the
    required financial statement disclosures.
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    &lt;div align="justify" style="font-size: 10pt; margin-top: 10pt; margin-left: 4%"&gt;Upon adoption of new GAAP effective January&amp;#160;1, 2010, the Company was required to change its
    accounting for the American Express Credit Account Master Trust (the Lending Trust), a previously
    unconsolidated VIE, which is now consolidated. As a result, beginning January&amp;#160;1, 2010, the
    securitized cardmember loans and related debt securities issued to third parties by the Lending
    Trust are included on the Company&amp;#8217;s Consolidated Balance Sheet. The Company continues to
    consolidate the American Express Issuance Trust (the Charge Trust). Prior period results have not
    been revised for the change in accounting for the Lending Trust. Refer to Note 7 for further
    discussion.
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