Russia’s central bank has reportedly canceled the banking license of the in-country subsidiary of American Express.
As Reuters reported Tuesday (Aug. 13), the central bank did so at the company’s request. American Express had filed a voluntary request to liquidate its Russian business in July, the report said, citing SPARK, Russia’s corporate registry.
Russian President Vladamir Putin signed off on that request in May, per Reuters. American Express had in 2022 joined other card networks and payment processors in suspending its operations in Russia, over what it deemed the country’s “unjustified attack on the people of Ukraine.”
According to the report, the Central Bank of the Russian Federation said American Express ranked 300th in Russia’s banking system in terms of assets. Since the Ukraine war began, foreign banks have required Putin’s permission to exit the market or sell stakes in their Russian business.
Russia aside, American Express is seeing double-digit spending growth from its international consumer customers, according to earnings released last month.
Overall, the company said, consumers are continuing to spend on experiences — especially on dining out, and that momentum is being driven by the younger generations who are using their cards more often. Spending by millennial and Gen Z consumers increased 13% year over year, management said during an earnings call with analysts.
CFO Christophe Le Caillec said that spending growth was visible across several categories, where spending on goods and services was 6% higher and there was 7% growth in travel and entertainment-related spending.
“We did see some slower growth in certain [travel and entertainment] categories versus the prior quarter, especially in airline and lodging,” he said, adding that spending at restaurants still “remained strong.”
As for using the cards more often, the company’s transaction growth was 9% higher in the June quarter compared to last year.
“Younger card members continue to demonstrate strong engagement, and we see that they transact over 25% more, on average, than our older customers,” said Le Caillec, and when it comes to categories such as dining, they transact twice as much.
Millennials and Gen Z consumers made up a third of the $165 billion in U.S. Consumer Services Billed Business — a metric that includes card member spending and cash advances, the earnings report said.
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