12:10AM New York – American Express net income jumps 12% on 9% rise in revenue net of interest.

American Express Company reported second quarter net income rise of 12% on revenue gain of 9% and diluted earnings per share increase of 13%.

Second quarter earnings increased to $1.06 billion from $945 million a year ago and earnings per share increased to 88 cents from 76 cents a year ago. Revenue net of interest in the quarter jumped to $7.1 billion from $6.5 billon. Total revenue including interest income jumped 13% to $8.2 billion.

Return on equity in the quarter jumped to 37.5% from 29.8% from a year ago. At the end of the quarter the book value per share jumped to $9 from $8.62 or total equity jumped to $10.6 billion from $10.5 billion a year ago.

The company added 2 million card members in the quarter and card spending rose 15% during the quarter to $161.1 billion. Revenues in the U.S. in the quarter increased 12% to $3.6 billion but earnings in the U.S. declined 2% to $584 million. Provision for loan losses increased 85% to reflect higher loan volumes and concerns related to economic weakness. Promotional and marketing costs jumped 16% from a year ago.

In the international segment, revenue increased 4% and earnings jumped 22%. The earnings in the quarter increased to $277 million and revenue to $2.2 billion. Marketing and promotion decreased 8%.

Lending finance revenue to card members jumped 38% to $1.5 billion. Total interest income jumped to $2.1 billion 34% from a year ago. American Express also provisioned for charges and losses $993 million, a jump of 36% from $730 million.

According to the company website, 80 million American Express cards are in the use and generate $560 billion in spending worldwide. Top 10 card issuers including several banks such as Citigroup, J P Morgan Chase, and Bank of America control 86% of purchase volume.

The company earnings per share increased by 16% in the year 2004, followed by 22% in 2005, and additional 18% in 2006, the cards in force jumped by 8%, 9%, and 10% respectively in the corresponding years. The company earnings in the first quarter of this year jumped 26%. The share of the U.S. purchase volume has jumped from 19.5% in 2002 to 23% at the end of 2006.

In after hours trading the company stock traded as low as $63.20, down 2% from the regular close at 4:00PM.