UNITED STATESSECURITIES AND EXCHANGE COMMISSIONWashington, D.C. 20549FORM 10-Q(X) QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THESECURITIES EXCHANGE ACT OF 1934For the quarterly period ended June 30, 2008OR( ) TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIESEXCHANGE ACT OF 1934For the transition period from ____ to ____Commission File No. 1-6908AMERICAN EXPRESS CREDIT CORPORATION(Exact name of registrant as specified in its charter)

|Delaware                                                                         |  | 11-1988350                                  
|-------------------------------------------------------------------------------- |  | --------------------------------------------
|(State or other jurisdiction
        of                                          |  | (I.R.S. Employer Identification
        No.)
|incorporation or organization)                                                   |  |                                             
|One Christina Centre,
          301 North Walnut Street                          |  |                                             
|Suite 1002, Wilmington,
          Delaware                                       |  | 19801-2919                                  
|(Address of principal executive
        offices)                                 |  | (Zip Code)                                  
|Registrants
        telephone number including area code:(302)
        594-3350

|None                                                                               
|-----------------------------------------------------------------------------------
|(Former name, former address and former fiscal year, if changed since last report.)

THE REGISTRANT MEETS THE CONDITIONS SET FORTH IN GENERAL INSTRUCTION H(1)(a) AND (b) OF FORM 10-Q AND HAS THEREFORE OMITTED CERTAIN ITEMS FROM THIS REPORT IN ACCORDANCE WITH THE REDUCED DISCLOSURE FORMAT PERMITTED UNDER
GENERAL INSTRUCTIONS H(2).

Indicate by check mark whether the registrant (1) has filed all reports required to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during the preceding 12 months (or for such shorter period that the
registrant was required to file such reports), and (2) has been subject to such filing requirements for the past 90 days.XYes   ___ No

Indicate by check mark whether the registrant is a large accelerated filer, an accelerated filer, a non-accelerated filer or a smaller reporting company. See definitions of large accelerated filer,
accelerated filer and smaller reporting company in Rule 12b-2 of the Exchange Act.

|Large accelerated filer | Accelerated filer        
|----------------------- | -------------------------
|Non-accelerated filer X | Smaller reporting company

Indicate by check mark whether the registrant is a shell company (as defined in Rule 12b-2 of the Exchange Act).___ Yes    X No

Indicate the number of shares outstanding of each of the issuers classes of common stock, as of the latest practicable date.

|Class                                   |  | Outstanding at August 5, 2008 | 
|--------------------------------------- |  | ----------------------------- | 
|Common Stock (par value $.10 per share) |  | 1,504,938 Shares             

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AMERICAN EXPRESS CREDIT CORPORATIONFORM 10-QINDEX

|         |                       |                                                             |  | Page
            No.
|-------- | --------------------- | ----------------------------------------------------------- |  | --------------------
|PART I.  | FINANCIAL INFORMATION |                                                             | 
|         |                       |                                                             | 
|         | Item 1.               | Financial Statements                                        |  |                     
|         |                       |                                                             |  |                     
|         |                       | Consolidated Statements of
        Income and Retained      |  |                     
|         |                       | Earnings  Three and
        six months ended June 30, 2008 |  |                     
|         |                       | and 2007                                                    |  | 3                   
|         |                       |                                                             |  |                     
|         |                       | Consolidated Balance Sheets                                |  |                     
|         |                       | June 30, 2008 and December
        31, 2007                 |  | 4                   
|         |                       |                                                             |  |                     
|         |                       | Consolidated Statements of
        Cash Flows              |  |                     
|         |                       | Six months ended June 30,
        2008 and 2007             |  | 5                   
|         |                       |                                                             |  |                     
|         |                       | Notes to Consolidated Financial
        Statements          |  | 6                   
|         |                       |                                                             |  |                     
|         | Item 2.               | Managements Discussion
          and Analysis              |  |                     
|         |                       | of Financial Condition
          and Results                |  |                     
|         |                       | of Operations                                               |  | 12                  
|         |                       |                                                             |  |                     
|         | Item 4.               | Controls and Procedures                                     |  | 20                  
|         |                       |                                                             |  |                     
|PART II. | OTHER INFORMATION     |                                                             | 
|         |                       |                                                             | 
|         | Item 6.               | Exhibits                                                    |  | 21                  
|         |                       |                                                             |  |                     
|         |                       | Signatures                                                  |  | 22                  
|         |                       |                                                             |  |                     
|         |                       | Exhibit Index                                               |  | E-1                 

- 2 -

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AMERICAN EXPRESS CREDIT CORPORATION

PART I. FINANCIAL INFORMATION

Item 1.FINANCIAL STATEMENTS

CONSOLIDATED STATEMENTS OF INCOMEAND RETAINED EARNINGS(Millions)(Unaudited)

| |                                                          |  | Three Months
          Ended |       | Six Months
          Ended
| | -------------------------------------------------------- |  | ---------------------------- | ----- | --------------------------
| |                                                          |  | June 30,                     |       | June 30,                  
| |                                                          |  | 2008                         |       |                           
|
| | Revenues                                                 |  |                              |       |                           
|
| | Discount revenue earned from
        purchased           |  |                              |       |                           
| | cardmember
        receivables and loans                 |  | $                            | 595   |                           
| | Interest income from affiliates                          |  |                              | 194   |                           
| | Interest income from investments                         |  |                              | 71    |                           
| | Finance revenue                                          |  |                              | 2     |                           
| | Other                                                    |  |                              | 3     |                           
| | Total
        revenues                                   |  |                              | 865   |                           
|
| | Expenses                                                 |  |                              |       |                           
|
| | Provision for losses, net
        of recoveries:         |  |                              |       |                           
| | 2008, $39;
        2007, $43 for the three months ended; |  |                              |       |                           
| | 2008, $81;
        2007, $89 for the six months ended    |  |                              | 108   |                           
| | Interest expense                                         |  |                              | 339   |                           
| | Interest expense to affiliates                           |  |                              | 72    |                           
| | Service fees to affiliates                               |  |                              | 51    |                           
| | Other                                                    |  |                              | 1     |                           
| | Total
        expenses                                   |  |                              | 571   |                           
|
| | Pretax income                                            |  |                              | 294   |                           
| | Income
        tax provision                             |  |                              | 41    |                           
| | Net income                                               |  |                              | 253   |                           
| | Retained earnings at beginning
        of period         |  |                              | 3,186 |                           
| | Dividends                                                |  |                              | (85   | )                         
| | Adoption
        of FIN 48                               |  |                              | -     |                           
| | Retained
        earnings at end of period               |  | $                            | 3,354 |                           

See Notes to Consolidated Financial Statements.

- 3 -

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AMERICAN EXPRESS CREDIT CORPORATIONCONSOLIDATED BALANCE SHEETS(Millions, except share data)(Unaudited)

| |                                                                       |  | June 30, |        | December
          31,
| | --------------------------------------------------------------------- |  | -------- | ------ | ----------------------
| |                                                                       |  | 2008     |        | 2007                  
|
| | Assets                                                                |  |          |        |                       
|
| | Cash and cash equivalents                                             |  | $        | 5,049  |                       
| | Investment securities                                                 |  |          | 2,574  |                       
| | Investment securities restricted                                      |  |          | 467    |                       
| | Cardmember receivables, less
        reserves: 2008, $771; 2007, $831 |  |          | 24,525 |                       
| | Cardmember loans, less reserves:
        2008, $11; 2007, $10         |  |          | 377    |                       
| | Loans to affiliates                                                   |  |          | 11,640 |                       
| | Deferred charges and other
        assets                             |  |          | 441    |                       
| | Due
        from affiliates                                           |  |          | 1,927  |                       
| | Total
        assets                                                  |  | $        | 47,000 |                       
|
| | Liabilities and Shareholders
          Equity                        |  |          |        |                       
|
| | Short-term debt                                                       |  | $        | 12,768 |                       
| | Short-term debt to affiliates                                         |  |          | 8,139  |                       
| | Current portion of long-term
        debt                             |  |          | 5,539  |                       
| | Long-term debt                                                        |  |          | 16,323 |                       
| | Total
        debt                                                    |  |          | 42,769 |                       
| | Accrued
        interest and other liabilities                        |  |          | 539    |                       
| | Total
        liabilities                                             |  |          | 43,308 |                       
|
| | Shareholders Equity                                                  |  |          |        |                       
|
| | Common stock, $.10 par value,
        authorized 3 million shares;    |  |          |        |                       
| | issued
        and outstanding 1.5 million shares                     |  |          | 1      |                       
| | Capital surplus                                                       |  |          | 161    |                       
| | Retained earnings                                                     |  |          | 3,354  |                       
| | Accumulated other comprehensive
        income (loss), net of tax:    |  |          |        |                       
| | Net
        unrealized securities gains                               |  |          | 30     |                       
| | Net
        unrealized derivatives losses                             |  |          | (37    | )                     
| | Foreign
        currency translation adjustments                      |  |          | 183    |                       
| | Total
        accumulated other comprehensive income                  |  |          | 176    |                       
| | Total
        shareholders equity                                    |  |          | 3,692  |                       
| | Total
        liabilities and shareholders equity                    |  | $        | 47,000 |                       

See Notes to Consolidated Financial Statements.

- 4 -

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AMERICAN EXPRESS CREDIT CORPORATIONCONSOLIDATED STATEMENTS OF CASH FLOWS(Millions)(Unaudited)

| |                                                                          |  | Six Months
          Ended
| | ------------------------------------------------------------------------ |  | --------------------------
| |                                                                          |  | June 30,                  
| |                                                                          |  | 2008                      
| | Cash Flows from Operating
          Activities                           |  |                           
| | Net income                                                               |  | $                         
| | Adjustments to reconcile
        net income to net cash                  |  |                           
| | provided
        by operating activities:                                |  |                           
| | Provision
        for losses                                             |  |                           
| | Amortization
        and other                                           |  |                           
| | Deferred
        taxes                                                   |  |                           
| | Changes in operating assets
        and liabilities:                     |  |                           
| | Due
        from affiliates                                              |  |                           
| | Other
        operating assets and liabilities                           |  |                           
| | Net
        cash provided by operating activities                        |  |                           
| | Cash Flows from Investing
          Activities                           |  |                           
| | Net decrease (increase) in
        cardmember receivables and loans      |  |                           
| | Purchase of investments                                                  |  |                           
| | Maturities of investments                                                |  |                           
| | Net (increase) decrease in
        loans to affiliates                   |  |                           
| | Net
        decrease (increase) in due from affiliates                   |  |                           
| | Net
        cash provided by (used in) investing activities              |  |                           
| | Cash Flows from Financing
          Activities                           |  |                           
| | Net decrease in short-term
        debt to affiliates with maturities of |  |                           
| | ninety
        days or less                                              |  |                           
| | Net (decrease) increase in
        short-term debt with maturities of    |  |                           
| | ninety
        days or less                                              |  |                           
| | Issuance of debt                                                         |  |                           
| | Redemption of debt                                                       |  |                           
| | Dividends
        paid                                                   |  |                           
| | Net
        cash provided by financing activities                        |  |                           
| | Effect of exchange rate changes
        on cash and cash equivalents     |  |                           
| | Net increase in cash and
        cash equivalents                        |  |                           
| | Cash
        and cash equivalents at beginning of period                 |  |                           
| | Cash
        and cash equivalents at end of period                       |  | $                         

See Notes to Consolidated Financial Statements.

- 5 -

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AMERICAN EXPRESS CREDIT CORPORATIONNOTES TO CONSOLIDATED FINANCIAL STATEMENTS(Unaudited)

|1. | Basis of Presentation                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                     
|-- | ------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
|   |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                           
|   | American Express Credit Corporation,
          together with its subsidiaries (Credco), is a wholly-owned subsidiary
          of American Express Travel Related Services Company, Inc. (TRS), which
          is a wholly-owned subsidiary of American Express Company (American
          Express).
      The accompanying Consolidated
          Financial Statements should be read in conjunction with the financial
          statements in the Annual Report on Form 10-K of Credco for the year
          ended December 31, 2007. Significant accounting policies disclosed
          therein have not changed. Certain prior year amounts have been reclassified
          to conform to the current year presentation of the Consolidated Statements
          of Cash Flows related to deferred taxes.
      The interim financial information
          in this report has not been audited. In the opinion of management,
          all adjustments necessary for a fair statement of the consolidated
          financial position and the consolidated results of operations for the
          interim periods have been made. All adjustments made were of a normal,
          recurring nature. Results of operations reported for interim periods
          are not necessarily indicative of results for the entire year.
      Accounting estimates are an
          integral part of the Consolidated Financial Statements. These estimates
          are based, in part, on managements assumptions concerning future
          events. Among the more significant assumptions are those that relate
          to reserves for cardmember losses relating to cardmember receivables
          and loans and income taxes. These accounting estimates reflect the
          best judgment of management, but actual results could differ.
      Recently Issued Accounting
            Standards
      Effective January 1, 2008, Credco
          partially adopted the Financial Accounting Standards Board (FASB) Statement
          of Financial Accounting Standards (SFAS) No. 157, Fair Value
          Measurements (SFAS No. 157). SFAS No. 157 applies broadly to
          financial and non-financial assets and liabilities reported or disclosed
          at fair value under existing authoritative accounting pronouncements.
          FASB Staff Position (FSP) FAS 157-2, Effective Date of FASB Statement
          No. 157 (FSP FAS 157-2), delays the effective date of SFAS No.
          157 for non-financial assets and non-financial liabilities, except
          for items that are recognized or disclosed at fair value in Credcos
          financial statements on a recurring basis (at least annually), until
          its fiscal year beginning after November 15, 2008, including interim
          periods within that fiscal year (January 1, 2009 for Credco). In accordance
          with FSP FAS 157-2, Credco has partially adopted SFAS No. 157 and has
          not applied the provisions of SFAS No. 157 to its equipment balances.
          Credco does not have any goodwill, intangible assets, land, or buildings
          that require the application of FAS 157.
      Credcos partial adoption
          of SFAS No. 157 did not result in significant changes to the valuation
          techniques it had previously used to measure the fair value of its
          financial instruments. Fair value is defined as the price that would
          be received to sell an asset or paid to transfer a liability (an exit
          price) in an orderly transaction between market participants at the
          measurement date, and is based on the companys principal or most
          advantageous market for the specific asset or liability. The primary
          impact to Credco upon its partial adoption of SFAS No. 157 is the expanded
          disclosure requirements. There were no impacts to the Consolidated
          Financial Statements. Refer to Note 4, which provides further details
          on Credcos partial adoption of SFAS No. 157.
      Effective January 1, 2008, Credco
          adopted SFAS No. 159, The Fair Value Option for Financial Assets
          and Financial Liabilities  Including an Amendment of FASB Statement
          No. 115 (SFAS No. 159). SFAS No. 159 allows companies the option
          to irrevocably elect, on a contract by contract basis, fair value as
          the initial and subsequent measurement for certain financial assets
          and financial liabilities. Credco has not elected the option for fair
          value measurement under SFAS No. 159 for any additional financial assets
          or financial liabilities that were not previously recognized at fair
    market value.

- 6 -

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AMERICAN EXPRESS CREDIT CORPORATIONNOTES TO CONSOLIDATED FINANCIAL STATEMENTS(Unaudited)

|   | As disclosed in Credcos
          Form 10-K for the year ended December 31, 2007, SFAS No. 160, Noncontrolling
          Interests in Consolidated Financial Statements, which is effective
          for Credco beginning January 1, 2009, is currently being evaluated
          for possible impact to Credco upon adoption.
      During 2008, the FASB has issued
          SFAS No. 161, Disclosures about Derivative Instruments and Hedging
          Activities - an amendment of FASB Statement No. 133 (SFAS No.
          161), amends and expands the disclosure requirements of SFAS No. 133, Accounting
          for Derivative Instruments and Hedging Activities (SFAS No. 133),
          requiring enhanced disclosures about Credcos derivative and hedging
          activities. Under SFAS No. 161, Credco is required to provide disclosures
          about (a) how and why it uses derivative instruments, (b) how derivative
          instruments and related hedged items are accounted for under SFAS No.
          133 and its related interpretations, and (c) how derivative instruments
          and related hedged items affect Credcos financial position, results
          of operations, and cash flows. SFAS No. 161 is effective prospectively
          beginning January 1, 2009, and applies to derivative instruments existing
          at the reporting date, with comparative disclosures of earlier periods
          encouraged upon initial adoption. Credco is currently evaluating the
    impact of this accounting standard.
|-- | ---------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
|   |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                              
|2. | Investment Securities                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                        
|   |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                              
|   | The following is a summary of investment securities
    at June 30, 2008 and December 31, 2007:                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                              
|   |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                              
|   |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                              
|   |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                              
|   |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                              
|   |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                              
|   | (Millions)                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                   
|   | U.S. Treasury and government                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                 
|   | agency
        securities                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                    
|   | U.S. Treasury and government                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                 
|   | agency
        securities  restricted(a)                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                    
|   | Total(b)                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                     

| |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                        |                                                                                                                                                                                        
| | ------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------ | ---------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
| | (a)                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                    | U.S. Treasury and government agency securities - restricted represented securities loaned out on an overnight basis to financial institutions under the securities lending program.    
| | (b)                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                    | Total investment securities include $2.6 billion of senior debentures issued by Government Sponsored Entities (Fannie Mae and Freddie Mac) at both June 30, 2008 and December 31, 2007.
|
| | All of Credcos
        investment securities are classified as Available-for-Sale. There were
        no realized gains or losses on U.S. Treasury and government agency securities
        for the six months ended June 30, 2008.
    Under securities lending agreements,
        Credco lends certain investment securities on an overnight basis to financial
        institutions. These lending arrangements are collateralized by an amount
        equal to at least 102 percent of the fair market value of the investment
        securities lent. Collateral received by Credco can be in the form of
        cash or marketable U.S. Treasury or government agency securities. Credco
        may only retain or sell these securities in the event of a borrower default.
        Credcos loaned investment securities are considered restricted
        and pledged assets and, therefore, have been reclassified as investment
        securities restricted on the Consolidated Balance Sheet. The marketable
        securities received as collateral are not recorded in its Consolidated
        Balance Sheet, as Credco is not permitted to sell or repledge these securities
        absent a borrower default. Fees received from the securities lending
    transactions are recorded as interest income from investments.

- 7 -

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AMERICAN EXPRESS CREDIT CORPORATIONNOTES TO CONSOLIDATED FINANCIAL STATEMENTS(Unaudited)

|3. | Comprehensive Income                                                            
|-- | --------------------------------------------------------------------------------
|   |                                                                                 
|   | The components of comprehensive income, net
    of related tax, were as follows:
|   |                                                                                 

|                                                  |  |                    | Three Months
          Ended |                    | Six Months
          Ended
|------------------------------------------------- |  | ------------------ | ---------------------------- | ------------------ | --------------------------
|(Millions)                                        |  | June
          30, |                              | June
          30,
|                                                  |  | 2008               |                              | 2007               |                           
|Net income                                        |  | $                  | 253                          |                    |                           
|Other comprehensive income
        (loss):        |  |                    |                              |                    |                           
|Net unrealized
        securities (losses) gains  |  |                    | (24                          | )                  |                           
|Net unrealized
        derivatives gains (losses) |  |                    | 39                           |                    |                           
|Foreign
        currency translation adjustments  |  |                    | 21                           |                    |                           
|Total                                             |  | $                  | 289                          |                    |                           

|   |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                               
|-- | ------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
|4. | Fair Value Measurements                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                       
|   |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                               
|   | Effective January 1, 2008,
          Credco partially adopted SFAS No. 157 for its financial assets and
          liabilities that are accounted for at fair value. SFAS No. 157 defines
          fair value, establishes a framework for measuring fair value, and expands
          disclosures about fair value measurements. Credcos partial adoption
          of SFAS No. 157 did not result in significant changes to the valuation
          techniques it had previously used to measure the fair value of its
          financial assets and liabilities. Therefore, the primary impact to
          Credco upon its partial adoption of SFAS No. 157 was to expand its
          fair value measurement disclosures.
      SFAS No. 157 established a three-level
          hierarchy of valuation techniques used to measure fair value, defined
    as follows:

- Unadjusted Quoted Prices  The fair value of an asset or liability is based on unadjusted quoted prices, in active markets for identical assets or liabilities. An example would be a
marketable equity security that is actively traded on the New York Stock Exchange. (Level 1)
- Pricing Models with Significant Observable Inputs  The fair value of an asset or liability is based on information derived from either an active market quoted price, which may require
further adjustment based on the attributes of the financial asset or liability being measured, or an inactive market transaction. Examples of such instruments would include (i) a
quoted price for an actively traded equity investment that is adjusted for a contractual trading restriction, or (ii) the fair value derived from a trade of an identical or similar security in an inactive market. (Level 2)
- Pricing Models with Significant Unobservable Inputs  The fair value of an asset or liability is primarily based on internally derived assumptions surrounding the timing and amount of
expected cash flows for the financial instrument. Therefore, these assumptions are unobservable in either an active or inactive market. An example would be the retained subordinated
interest in a securitization trust. (Level 3)

- 8 -

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AMERICAN EXPRESS CREDIT CORPORATIONNOTES TO CONSOLIDATED FINANCIAL STATEMENTS(Unaudited)



|                                                 | The following table
        presents Credcos financial instruments carried at fair value as
        of June 30, 2008, by caption on the Consolidated Balance Sheet and by
    SFAS No. 157 fair value hierarchy level (as described previously).                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                     
|------------------------------------------------ | --------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
|                                                 |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                       
|                                                 |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                       
|                                                 |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                       
|                                                 | (Millions)                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                            
|Assets                                           |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                       
|Investment
        securities (b)                |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                       
|Deferred
        charges and other assets -      |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                       
|Derivatives,
        net (c)                     |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                       
|Total
        assets at fair value               |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                       
|                                                 |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                       
|Liabilities                                      |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                       
|Accrued
        interest and other liabilities  |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                       
|Derivatives,
        net (c)                     |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                       
|Total
        liabilities at fair value          |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                       
|                                                 |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                       
|                                                 |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                       
|                                                 |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                       
|                                                 |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                       
|                                                 |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                       
|                                                 | Description
            of Financial Assets and Liabilities Fair Value MethodologiesThe following is a description
                    of the valuation techniques used for the respective financial
                    instruments when measured at fair value, including the general
                    classification of such items pursuant to the fair value hierarchy.
                    These techniques may produce fair values that may not be
                    indicative of a future sale, or reflective of future fair
                    values. The use of different techniques to determine the
                    fair value of these types of financial instruments could
                    result in different estimates of fair value at the reporting
                    date.
        Investment SecuritiesThe fair market values for Credcos
            investments are obtained primarily from third-party pricing vendors
            engaged by Credco. When available, quoted market prices are used
            to determine fair value. When quoted prices are available in an active
            market, investments are classified within Level 1 of the fair value
            hierarchy. Currently, Credco does not have any Level 1 investment
            securities.
      When quoted prices in an active
          market are not available, fair values are estimated by using pricing
          models, where the inputs to those models are based on observable market
          inputs. The inputs to the valuation techniques vary depending on the
          type of security being priced but are typically benchmark yields, reported
          trades, broker-dealer quotes, and benchmarking of like securities.
          The pricing models used generally do not entail substantial subjectivity
          because the methodologies employed use inputs observed from active
          markets or recent trades of similar securities in inactive markets.
          All of Credcos investment securities are classified as Level
    2 of the fair value hierarchy.

- 9 -

---



AMERICAN EXPRESS CREDIT CORPORATIONNOTES TO CONSOLIDATED FINANCIAL STATEMENTS(Unaudited)

|   | Credco has a thorough and documented
          understanding of the valuation techniques used by its pricing vendors.
          In addition, Credco corroborates the prices provided by its pricing
          vendors to test their reasonableness by comparing their prices to valuations
          from different pricing sources.
      Deferred Charges and Other
            Assets and Accrued Interest and Other Liabilities  Derivatives,
            netThe fair values of derivatives are estimated
          by using pricing models, where the inputs to those models are based
          on readily observable market parameters. The valuation models used
          by Credco are consistently applied and reflect the contractual terms
          of the derivatives, including the period to maturity, and market-based
          parameters such as interest rates, foreign exchange rates, and volatility.
          These models do not contain a high level of subjectivity as the valuation
          techniques used do not require significant judgment, and inputs to
          the models are readily observable from actively quoted markets.
      Market practice in pricing derivatives
          initially assumes all counterparties have the same credit quality.
          Credit valuation adjustments are necessary when the market parameter
          (for example, a benchmark curve) used to value derivatives is not indicative
          of the credit quality of Credco or its counterparties. Credco manages
          derivative counterparty credit risk by considering the current exposure,
          which is the replacement cost of contracts on the measurement date,
          as well as estimating the maximum potential value of the contracts
          over their remaining lives, considering such factors as maturity date
          and the volatility of the underlying or reference index. Credco mitigates
          derivative credit risk by transacting with highly rated counterparties,
          and where possible entering into legally enforceable master netting
          agreements which reduce credit risk by permitting the netting of transactions
          with the same counterparty upon occurrence of certain events. Management
          has evaluated the credit and nonperformance risks associated with its
          derivative counterparties and believes them to be insignificant and
          not warranting a credit adjustment.
      Credcos derivatives primarily
          include interest rate swaps, foreign currency forwards, foreign currency
          options, and cross currency swaps. Such instruments are classified
    within Level 2 of the fair value hierarchy.
|-- | ---------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
|   |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                        
|5. | Income Taxes                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                           
|   |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                        
|   | The results of operations of
          Credco are included in the consolidated U.S. federal income tax return
          of American Express. Under an agreement with TRS, provision for income
          taxes is recognized on a separate company basis.  If
          benefits for net operating losses, future tax deductions and foreign
          tax credits cannot be recognized on a separate company basis, such
          benefits are then recognized based upon a share, derived by formula,
          of those deductions and credits that are recognizable on a TRS consolidated
          reporting basis.
      American Express is under continuous
          examination by the Internal Revenue Service (IRS) and tax authorities
          in other countries and states in which American Express has significant
          business operations. The tax years under examination and open for examination
          vary by jurisdiction. In June 2008, the IRS completed its field examination
          of American Express federal tax returns for the years 1997 through
          2002. However, for federal income tax purposes, these years continue
          to remain open as a consequence of certain issues under appeal. American
          Express is currently under examination by the IRS for the years 2003
          and 2004.
      Credco had approximately $68
          million and $55 million of unrecognized tax benefits at June 30, 2008
          and December 31, 2007, respectively. The change is primarily due to
          an increase in unrecognized tax benefits relating to the attribution
          of pretax income to a particular jurisdiction or jurisdictions.
      Credco routinely assesses the
          likelihood of additional assessments in each taxing jurisdiction and
          has established a liability for unrecognized tax benefits that Credcos
          management believes to be adequate. Once established, unrecognized
          tax benefits are adjusted if more accurate information is available,
    or a change in                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                  

- 10 -

---



AMERICAN EXPRESS CREDIT CORPORATIONNOTES TO CONSOLIDATED FINANCIAL STATEMENTS(Unaudited)

| | circumstance, or an event occurs
          necessitating a change to the liability. It is reasonably possible
          that the unrecognized tax benefits may significantly increase or decrease
          within the next twelve months. Due to the inherent complexities and
          the number of tax years currently under examination, it is not possible
          to quantify the impact such changes may have on the effective tax rate.
      Credcos effective tax
          rate was 14 percent and 12 percent for the three and six months ended
          June 30, 2008, respectively, compared with 7 percent for the full year
          2007. The effective tax rate was higher in 2008 as compared to 2007
          primarily due to the attribution and change in the geographic mix of
    pretax income among various jurisdictions.
| | -------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

- 11 -

---



AMERICAN EXPRESS CREDIT CORPORATION

|Item 2. | MANAGEMENTS DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS
|------- | -------------------------------------------------------------------------------------

| | American Express Credit Corporation,
          together with its subsidiaries (Credco), is a wholly-owned subsidiary
          of American Express Travel Related Services Company, Inc. (TRS), a
          wholly-owned subsidiary of American Express Company (American Express).
          Credco is primarily engaged in the business of financing non-interest-bearing
          cardmember receivables arising from the use of the American Express®card,
          the American Express®Gold
          card, Platinum card®,
          Corporate card and other American Express cards issued in the United
          States, and in designated currencies outside the United States. Credco
          also purchases certain interest-bearing and discounted revolving loans
          comprised of American Express credit cards and Sign & Travel®,
          although interest-bearing and revolving loans are primarily funded
          by subsidiaries of TRS other than Credco. American Express cards and
          American Express credit cards are collectively referred to herein as
          the Card.
      In 2007, Credco made changes
          to certain international funding strategies which have generally resulted
          in the transfer of receivables with recourse to Credco from certain
          TRS subsidiaries. Prior to these funding strategy changes, Credco purchased
          the cardmember receivables without recourse and recorded the receivables
          as cardmember receivables. These funding strategy changes resulted
          in Credco recording additional loans to affiliates and a reduction
          in cardmember receivables.
      Results of Operations for
            the Six Months Ended June 30, 2008 and 2007
      Pretax income depends primarily
          on the volume of cardmember receivables and loans purchased, the discount
          factor used to determine purchase price, the relationship of the total
          discount to Credcos interest expense and the collectibility of
          cardmember receivables and loans purchased.
      Credcos consolidated net
          income increased 9 percent to $407 million for the six months ended
          June 30, 2008, as compared to the six months ended June 30, 2007. The
          year-over-year increase was primarily due to an increase in interest
          income earned on loans to affiliates and investments and a decrease
          in interest expense, partially offset by a decrease in discount revenue
          and an increase in provision for losses, net of recoveries.
      The following table summarizes
          the changes attributable to the increase (decrease) in key revenue
          and expense accounts for the six month period ended June 30, 2008,
    compared with the six month period ended June 30, 2007 (millions):
| | -------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
| |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                      

|                                                  | Discount revenue earned on
        purchased cardmember receivables and loans: |   |      |   |  | 
|------------------------------------------------- | ------------------------------------------------------------------------------ | - | ---- | - |  | 
|Volume
        of receivables purchased           |                                                                                | $ | (34  | )
|Discount
        rates                            |                                                                                |   | (70  | )
|Total                                             |                                                                                | $ | (104 | )
|                                                  |                                                                                |   |      |  
|Interest income from affiliates:                  |                                                                                |   |      |  
|Average
        loans to affiliates               |                                                                                | $ | 65   |  
|Interest
        rates                            |                                                                                |   | 14   |  
|Total                                             |                                                                                | $ | 79   |  
|                                                  |                                                                                |   |      |  
|Interest income from investments:                 |                                                                                |   |      |  
|Average
        investments outstanding           |                                                                                | $ | 100  |  
|Interest
        rates                            |                                                                                |   | (87  | )
|Total                                             |                                                                                | $ | 13   |  
|                                                  |                                                                                |   |      |  
|Provision for losses, net
        of recoveries:  |                                                                                |   |      |  
|Volume
        of receivables and loans purchased |                                                                                | $ | (9   | )
|Provision
        rates and volume of recoveries  |                                                                                |   | 51   |  
|Total                                             |                                                                                | $ | 42   |  

- 12 -

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AMERICAN EXPRESS CREDIT CORPORATION

|                                 | Interest expense: |   |      |   |  | 
|-------------------------------- | ----------------- | - | ---- | - |  | 
|Average
        debt outstanding |                   | $ | 120  |  
|Interest
        rates           |                   |   | (175 | )
|Total                            |                   | $ | (55  | )
|                                 |                   |   |      |  
|Interest expense to affiliates:  |                   |   |      |  
|Average
        debt outstanding |                   | $ | 51   |  
|Interest
        rates           |                   |   | (111 | )
|Total                            |                   | $ | (60  | )

| |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                            
| | -----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
| | Discount Revenue Earned
            on Purchased Cardmember Receivables and Loans
      Discount revenue decreased 8
          percent or $104 million to $1.2 billion for the six months ended June
          30, 2008, as compared to the six months ended June 30, 2007, primarily
          due to a decrease in both the volume of receivables purchased and discount
          rates. Volume of receivables and loans purchased for the six months
          ended June 30, 2008, was 2 percent lower than the same period a year
          ago; purchased volume does not include those cardmember receivables
          transferred with recourse to Credco and cardmember receivables and
          loans funded by loans to affiliates. Discount rates, which vary over
          time due to changes in market interest rates or changes in the collectibility
          of cardmember receivables, decreased an average of approximately 5
          basis points compared to the six months ended June 30, 2007.
      Interest Income from Affiliates
      Interest income from affiliates
          increased 26 percent or $79 million to $382 million for the six months
          ended June 30, 2008, as compared to the six months ended June 30, 2007.
          The year-over-year increase is due to an increase in both the volume
          of loans to affiliates, and to a lesser extent the interest rates charged
          to affiliates. The average volume of loans to affiliates increased
          due to a change in international funding strategy as further discussed
          above. The average interest rate charged to affiliates during the six
          months ended June 30, 2008, was 11 basis points higher than the average
          interest rate charged to affiliates in the same six month period a
          year ago.
      Interest Income from Investments
      Interest income from investments
          increased 10 percent or $13 million to $143 million for the six months
          ended June 30, 2008, as compared to the six months ended June 30, 2007.
          The year-over-year increase is due to an increase in the average outstanding
          amount of cash and cash equivalents offset by the decrease of the average
          interest rate on the total investment portfolio of approximately 95
          basis points for the six months ended June 30, 2008, as compared to
          the same six month period a year ago. The increase in cash and cash
          equivalents reflects the issuance of short-term and long-term debt
          that was in excess of Credcos business operating needs, and investment
          of the excess proceeds in cash equivalents.
      Provision for Losses, Net
            of Recoveries
      The provision for losses, net
          of recoveries increased 13 percent or $42 million to $356 million for
          the six months ended June 30, 2008, as compared to the six months ended
          June 30, 2007. The year-over-year increase primarily reflects higher
          write-off and delinquency rates compared to the same period a year
          ago, reflecting a more difficult U.S. credit environment.
      Interest Expense and Interest
            Expense to Affiliates
      Interest expense and interest
          expense to affiliates decreased 7 percent and 28 percent, respectively,
          for the six months ended June 30, 2008, as compared to the same period
          a year ago, due to lower interest rates. The average interest rate
          on debt outstanding during the six months ended June 30, 2008, was
          52 basis points lower than the

- 13 -

---



AMERICAN EXPRESS CREDIT CORPORATION

| | same period a year ago. The
          average rate due to affiliates during the six months ended June 30,
          2008, was 111 basis points lower than the same period a year ago.
      Service Fees to Affiliates
      Credco pays fees to affiliates
          for the related servicing of the receivables purchased. Service fees
          to affiliates increased 11 percent or $10 million to $102 million for
          the six months ended June 30, 2008, as compared to the six months ended
          June 30, 2007, due to an increase in servicing provided by service
          level agreements with affiliates.
      Income Taxes
      Credcos effective tax rate
          for both the six months ended June 30, 2008 and 2007 was 12 percent.
      Cardmember Receivables
      At June 30, 2008 and December
          31, 2007, Credco owned $25.3 billion and $26.3 billion of cardmember
          receivables, respectively. Cardmember receivables represent amounts
          due from charge card customers and are recorded at the time they are
          purchased from the seller. Included in cardmember receivables are Credco
          Receivables Corporation (CRC)s purchases of the participation
          interests from American Express Receivables Financing Corporation V
          LLC (RFC V) in conjunction with TRS securitization program. At
          June 30, 2008 and December 31, 2007, CRC owned approximately $3.4 billion
          and $5.7 billion, respectively, of participation interests purchased
          from RFC V.
      The following table summarizes
    selected information related to the cardmember receivables portfolio:
| | ------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
| |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                   

| |                                                                       |  |      | June 30, |      | December
          31, |      | June 30, |  
| | --------------------------------------------------------------------- |  | ---- | -------- | ---- | ---------------------- | ---- | -------- | -
| | As
        of and for six months ended (Millions, except percentages) |  | 2008 |          | 2007 |                        | 2007
| | Total cardmember receivables                                          |  | $    | 25,296   |      |                        | $    | 26,335   |  
| | 90 days past due as a % of
        total                              |  |      | 3.9      | %    |                        |      | 4.0      | %
| | Loss reserves                                                         |  | $    | 771      |      |                        | $    | 831      |  
| | as a %
        of receivables                                         |  |      | 3.0      | %    |                        |      | 3.2      | %
| | as a %
        of 90 days past due                                    |  |      | 77       | %    |                        |      | 77       | %
| | Write-offs, net of recoveries                                         |  | $    | 364      |      |                        | $    | 359      |  
| | Net write-off rate (1)                                                |  |      | 0.26     | %    |                        |      | 0.24     | %
| | Average
        life of cardmember receivables (in days) (2)          |  |      | 33       |      |                        |      | 33       |  

| | (1)                                                                                                                                                                                                                                                                                                                                                                                                                                                                                       | Credcos write-offs, net of recoveries, expressed as a percentage of the volume of cardmember receivables purchased by Credco in each of the periods indicated.                                                                                                                               
| | ----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------- | ----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
| | (2)                                                                                                                                                                                                                                                                                                                                                                                                                                                                                       | Represents the average life of cardmember receivables owned by Credco, based upon the ratio of the average amount of both billed and unbilled receivables owned by Credco at the end of each month, during the periods
indicated, to the volume of cardmember receivables purchased by Credco.
|
| | Cardmember receivables owned at June
      30, 2008, decreased approximately $1.0 billion from December 31, 2007,
      as a result of lower consumer, small business and corporate cardmember
      receivables purchased during the six months ended June 30, 2008. The cardmember
      receivables purchased for the six months ended June 30, 2008, decreased
      approximately 2 percent from the cardmember receivables purchased during
    the six months ended June 30, 2007.

- 14 -

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AMERICAN EXPRESS CREDIT CORPORATION

| | Reserves for Cardmember
              Receivables and Cardmember Loans
      The following is an analysis
    of the reserves for cardmember receivables and cardmember loans:
| | ------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
| |                                                                                                                                                                               

| |                                     |  |      | June 30, |   | June 30, |  
| | ----------------------------------- |  | ---- | -------- | - | -------- | -
| | Six
        months ended (Millions) |  | 2008 |          |   | 2007    
| | Balance, beginning of period        |  | $    | 841      |   |          | $
| | Provision for losses (1)            |  |      | 356      |   |          |  
| | Accounts written-off (1)            |  |      | (370     | ) |          |  
| | Other                               |  |      | (45      | ) |          |  
| | Balance,
        end of period      |  | $    | 782      |   |          | $

| | (1)   Includes recoveries on
          accounts previously written-off of $81 million and $89 million during
          the six months ended June 30, 2008 and 2007, respectively.
      Loans to Affiliates
      Components of loans to affiliates
    were as follows:
| | ------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
| |                                                                                                                                                                                                                                                                         

| |                                                    |  |      | June 30, |      | December
          31, |      | June 30, |  |  
| | -------------------------------------------------- |  | ---- | -------- | ---- | ---------------------- | ---- | -------- |  | -
| | (Millions)                                         |  | 2008 |          | 2007 |                        | 2007 |         
| | TRS Subsidiaries:                                  |  |      |          |      |                        |      |          |  |  
| | American Express Australia
        Limited         |  | $    | 4,184    |      |                        | $    | 3,897    |  | $
| | American Express Services
        Europe Limited   |  |      | 3,108    |      |                        |      | 3,659    |  |  
| | Amex Bank of Canada                                |  |      | 2,649    |      |                        |      | 2,664    |  |  
| | American Express International,
        Inc.       |  |      | 860      |      |                        |      | 535      |  |  
| | American Express Co.
        (Mexico) S.A. De C.V. |  |      | 489      |      |                        |      | 446      |  |  
| | American
        Express Bank (Mexico) S.A.        |  |      | 350      |      |                        |      | -        |  |  
| | Total                                              |  | $    | 11,640   |      |                        | $    | 11,201   |  | $

| |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                
| | -------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
| | Loans to affiliates increased
          from 2007 as a result of funding strategy changes as previously discussed,
          as well as overall business growth. Of the $11.6 billion outstanding
          of loans to affiliates, approximately $7.8 billion are collateralized
          by the underlying cardmember receivables transferred with recourse.
          Additionally, as part of this funding strategy, Credco loaned $350
          million to American Express Bank (Mexico) S.A. during the second quarter
          of 2008. Additionally, beginning prospectively on September 30, 2007,
          certain cardmember receivables were reclassified to loans to affiliates.
      Impact of Capital Markets
            Environment
      Investment Portfolio
      Credcos investment portfolio
          primarily supports its contingent liquidity strategy. As a result,
          Credco generally holds investments to maturity. However, management
          may sell securities prior to maturity due to changes in Credcos
          business goals, liquidity needs, and the market environment. At June
          30, 2008, Credco owned approximately $3.0 billion of U.S. Treasury
          and government agency securities, all of which are part of the contingent
          liquidity portfolio and are considered Available-for-Sale securities.
          At both June 30, 2008 and December 31, 2007, Credco owned, as part
          of the $3.0 billion total, approximately $2.6 billion of senior unsecured
          debentures issued by Government Sponsored Entities: Fannie Mae and
          Freddie Mac. Of the $47 million of net unrealized gains in the investment
          portfolio at June 30, 2008, approximately $38 million relate to these
          Government Sponsored Entities. There has been no material adverse change
          in the market value of these securities to date in July 2008.
      Credco did not experience any
          defaults or events of default, or determine it would not receive timely
          contractual payments of interest and repayment of principal, on any
          of its holdings in its investment portfolio in the second quarter of
          2008.

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AMERICAN EXPRESS CREDIT CORPORATION

| | Valuations of securities held
          within Credcos investment portfolio will continue to be subject
          to changes in external market factors including default rates, rating
          agency actions, and the prices at which observable market transactions
          occur. Credcos future results may be impacted by the valuation
          adjustments applied to these holdings.
      Funding
      Credco is committed to maintaining
          cost-effective, well-diversified funding programs to support current
          and future asset growth in its global businesses. Credcos funding
          plan is structured to meet expected and changing business needs to
          fund asset balances efficiently and cost-effectively. Credco relies
          on diverse sources of funding, with wide ranges of maturities, and
          its contingent liquidity strategy allows for the continued funding
          of business operations through difficult economic, financial market
          and business conditions when access to regular funding sources could
          become diminished or interrupted. Credcos funding plans are subject
          to various risks and uncertainties, such as future business growth,
          market capacity and demand for securities offered by Credco and regulatory
          changes. Many of these risks and uncertainties are beyond Credcos
          control.
      Despite the turmoil in the fixed-income
          capital markets that emerged in the second half of 2007 and continues
          today, Credco continues to have access to financing through its existing
          funding sources in excess of needs to satisfy maturing obligations
          and to fund its business growth.
      Credco will continue to evaluate
          its alternative sources of funding and seek the mix that achieves cost-efficiency
          consistent with its funding and liquidity strategies. Further disruptions
          and continued turmoil in the financial markets could result in changes
          in the amount and mix of financing it obtains in the future from its
          existing funding sources. Specifically, a potential lack of investor
          demand in certain sectors of the debt capital market, such as for 1-to-5
          year unsecured floating rate debt or commercial paper, could alter
          Credcos funding mix. In such cases, Credco may increase its issuance
          of longer-term debt.
      Credit ratings have a significant
          impact on the borrowing costs of Credco. There were no changes in Credcos
          credit ratings during the second quarter of 2008; however, in July
          2008, one of the four credit rating agencies that cover Credco revised
          its outlook on Credco from stable to negative. This negative outlook
          assesses the potential direction of a rating over the intermediate
          term, reflects changes in the economy and business conditions, and
          while indicating a rating may be lowered, is not necessarily a precursor
          of a rating change. Credit ratings are subject to change or withdrawal
          at any time.
      Fair Value Measurements
      Effective January 1, 2008, Credco
          partially adopted Statement of Financial Accounting Standards (SFAS)
          No. 157 for its financial assets and liabilities that are accounted
          for at fair value. SFAS No. 157 defines fair value, establishes a framework
          for measuring fair value, and expands disclosures about fair value
          measurements. Credcos partial adoption of SFAS No. 157 did not
          result in significant changes to the valuation techniques it had previously
          used to measure the fair value of its financial assets and liabilities.
          Therefore, the primary impact to Credco upon its partial adoption of
          SFAS No. 157 was expanding its fair value measurement disclosures.
      SFAS No. 157 established a three-level
          hierarchy of valuation techniques used to measure fair value, defined
    as follows:
| | ---------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

- Unadjusted Quoted Prices  The fair value of an asset or liability is based on unadjusted quoted prices, in active markets for identical assets or liabilities. An example would be a
marketable equity security that is actively traded on the New York Stock Exchange. (Level 1)
- Pricing Models with Significant Observable Inputs  The fair value of an asset or liability is based on information derived from either an active market quoted price, which may require
further adjustment based on the attributes of the financial asset or liability being measured, or an inactive market transaction. Examples of such instruments would include (i) a
quoted price for an actively traded equity investment that is adjusted for a

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AMERICAN EXPRESS CREDIT CORPORATION



- Pricing Models with Significant Unobservable Inputs  The fair value of an asset or liability is primarily based on internally derived assumptions surrounding the timing and amount of
expected cash flows for the financial instrument. Therefore, these assumptions are unobservable in either an active or inactive market. An example would be the retained interest in a
securitization trust. (Level 3)

| | Credco does not have any financial
          assets or liabilities categorized within Level 1 or Level 3 of the
          fair value hierarchy. See Note 4 of Credcos Consolidated Financial
          Statements for further details regarding its fair value measurements.
      Consolidated Liquidity and
            Capital Resources
      Credco had cash and cash equivalents
          of approximately $5.0 billion and $2.9 billion at June 30, 2008 and
          December 31, 2007, respectively.
      Credcos funding requirements
          are met primarily by the sale of commercial paper, the issuance of
          long-term notes, borrowings under long-term bank credit facilities
          in certain international markets and equity capital. Credco has readily
          sold the volume of debt necessary to meet its funding needs.
      The commercial paper market
          represents the primary source of short-term funding for Credco. Credcos
          commercial paper is a widely recognized name among short-term investors.
          The table below illustrates Credcos commercial paper outstanding
    and back-up liquidity coverage:
| | -----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
| |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                

| |                                                                    |  |      | June 30, |      | December
          31, | 
| | ------------------------------------------------------------------ |  | ---- | -------- | ---- | ---------------------- | 
| | (Billions,
        except percentages)                             |  | 2008 |          | 2007
| |                                                                    |  |      |          |      |                        | 
| | Commercial paper outstanding                                       |  | $    | 12.5     |      |                        | 
| | Average commercial paper
        outstanding                       |  | $    | 12.4     |      |                        | 
| | Net short-term debt outstanding(1)                                 |  | $    | 7.7      |      |                        | 
| | Total
        back-up liquidity coverage of net short-term debt(2) |  |      | 143      | %    |                        | 

| | (1)                                                                                                                                                                                                                                                                                                                                                                                                                                                               | Credco currently manages the level of short-term debt
outstanding such that its total back-up liquidity, including maximum available
bank credit facilities and term liquidity portfolio investment securities, is
not less  than 100 percent of net short-term debt. Net short-term debt consists
of commercial paper and certain other short-term borrowings less cash and cash
equivalents.
| | ----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------- | ----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
|
| | (2)                                                                                                                                                                                                                                                                                                                                                                                                                                                               | Based on the maximum available borrowings under bank credit facilities and term liquidity portfolio investment securities.                                                                                                                                                                                                                                                                    
| |                                                                                                                                                                                                                                                                                                                                                                                                                                                                   |                                                                                                                                                                                                                                                                                                                                                                                               
| | Long-term
        debt is raised through the offering of debt securities in the United
        States and in certain international capital markets. Long-term debt is
        generally defined as any debt with an original maturity greater than
        12 months. Credco continues to issue debt with a range of maturities
        to diversify the refinancing requirements in future periods.
    Credco had the following long-term
    debt outstanding:

| |                                |  |      | June 30, |      | December
          31, |   |     
| | ------------------------------ |  | ---- | -------- | ---- | ---------------------- | - | ----
| | (Billions)                     |  | 2008 |          | 2007 |                       
| |                                |  |      |          |      |                        |   |     
| | Long-term debt outstanding     |  | $    | 21.9     |      |                        | $ | 22.3
| | Average
        long-term debt |  | $    | 21.4     |      |                        | $ | 22.7

| |                                                                                                                                                                                                                                                                                                                                                                                 
| | --------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
| | Credco also has the ability to issue debt securities
        under shelf registrations filed with the Securities and Exchange Commission
        (SEC). The shelf registration statement filed with the SEC is for an
        unspecified amount of debt securities to be issued from time to time.
    During the six months ended June 30, 2008, Credco issued $3.3 billion of

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AMERICAN EXPRESS CREDIT CORPORATION

| | debt securities from its U.S. shelf registration. At June 30, 2008,
        Credco had $12.5 billion of debt securities outstanding, issued under
    the SEC registration statements.                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                              
| | ----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
| |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                     
| | Credco, in conjunction with
          certain subsidiaries of American Express, has established a program
          for the issuance, outside the United States, of debt instruments to
          be listed on the Luxembourg Stock Exchange. On July 18, 2008, this
          program was renewed and the maximum aggregate principal amount of debt
          instruments outstanding at any one time under the program was increased
          to $50.0 billion. The proceeds of these issuances are used for financing
          operations, including the purchase of receivables and the repayment
          of previously issued debt. At June 30, 2008, $4.1 billion was outstanding
          under this program, of which $2.8 billion was issued by Credco.
      Credco established a program
          in Australia for the issuance of debt securities from time to time
          of up to approximately $5.7 billion. During the six months ended June
          30, 2008, no notes were issued under this program. At June 30, 2008,
          approximately $4.9 billion was available for issuance under this program.
      During the fourth quarter of
          2007, the shelf prospectus previously filed by American Express Canada
          Credit Corporation (Cancredco), an indirect wholly-owned subsidiary
          of Credco, in Canada expired for the Canadian medium-term note program.
          Also during that quarter, Cancredco borrowed approximately $295 million
          from the Bank of Montreal under a credit agreement guaranteed by Credco.
          The proceeds were used to pay the long-term notes under this program
          that had matured. During the second quarter of 2008, Cancredco repaid
          this loan.
      During the first quarter of
          2008, a new shelf prospectus was filed and became effective in Canada
          for a medium-term note program providing for the issuance from time
          to time, in Canada, of up to approximately $3.5 billion of notes by
          Cancredco. All notes issued under this shelf registration will be guaranteed
          by Credco. During the second quarter of 2008, Cancredco issued approximately
          $494 million of medium-term notes. The financial results of Cancredco
          are included in the consolidated financial results of Credco.
      Credco paid cash dividends of
          $210 million to TRS during the six months ended June 30, 2008.
      The most restrictive limitation
          on dividends imposed by the debt instruments issued by Credco is the
          requirement that Credco maintain a minimum consolidated net worth of
          $50 million. There are no significant restrictions on the ability of
          Credco to obtain funds from its subsidiaries by dividend or loan. Additionally,
          there are no limitations on the amount of debt that can be issued by
          Credco.
      Committed Bank Credit
              Facilities
      Credco maintained committed
    bank credit facilities at June 30, 2008 as follows:
| |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                     

| |              |  |       |      |         |   | American |  |   |      |     | 
| | ------------ |  | ----- | ---- | ------- | - | -------- |  | - | ---- | --- | 
| | (Billions)   |  | Total |      | Express |   | Credco   |  |  
| | Committed(a) |  | $     | 11.7 |         | $ | 1.2      |  | $ | 10.5 | (b) | 
| | Outstanding  |  | $     | 3.5  |         | $ | -        |  | $ | 3.5  |     | 

| | (a)                                                              | Included is $3.5 billion outstanding related to the Australian credit facility.                                                                                 
| | ---------------------------------------------------------------- | ----------------------------------------------------------------------------------------------------------------------------------------------------------------
| | (b)                                                              | Credco has the right to borrow a maximum amount of $11.7 billion with a commensurate maximum $1.2 billion reduction in the amount available to American Express.
|
| | Credcos committed bank credit
    facilities expire as follows:
| |                                                                 

| |       | (Billions) |   |      |  |  | 
| | ----- | ---------- | - | ---- |  |  | 
| | 2010  |            | $ | 1.9  | 
| | 2011  |            |   | 2.8  | 
| | 2012  |            |   | 7.0  | 
| | Total |            | $ | 11.7 | 

| | 
| | 

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AMERICAN EXPRESS CREDIT CORPORATION

| | The availability of the credit
          lines is subject to Credcos compliance with certain financial
          covenants that require maintenance of a 1.25 ratio of combined earnings
          and fixed charges to fixed charges. The ratio of earnings to fixed
          charges for Credco was 1.53 for the six months ended June 30, 2008.
          The ratio of earnings to fixed charges for American Express for the
          six months ended June 30, 2008 was 2.13.
      Committed bank credit facilities
          do not contain material adverse change clauses, which may preclude
          borrowing under the credit facilities. Additionally, the facilities
          may not be terminated should there be a change in Credcos credit
          rating.
      Forward-Looking Statements
      Various statements have been
          made in this Quarterly Report on Form 10-Q that may constitute forward-looking
          statements within the meaning of the Private Securities Litigation
          Reform Act of 1995. Forward-looking statements may also be made in
          Credcos other reports filed with or furnished to the SEC and
          in other documents. In addition, from time to time, Credco through
          its management may make oral forward-looking statements. Forward-looking
          statements are subject to risks and uncertainties, including those
          identified below, which could cause actual results to differ materially
          from such statements. The words believe, expect, anticipate, optimistic,
  intend, plan, aim, will, may, should, could, would, likely and
  similar expressions are intended to identify forward-looking statements. Credco
  cautions you that the risk factors described below are not exclusive. There
  may also be other risks that Credco is unable to predict at this time that
  may cause actual results to differ materially from those in forward-looking
  statements. Readers are cautioned not to place undue reliance on these forward-looking
  statements, which speak only as of the date on which they are made. Credco
  undertakes no obligation to update or revise any forward-looking statements.
      Factors that could cause actual
          results to differ materially from Credcos forward-looking statements
    include, but are not limited to:
| | ----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

- credit trends, which will depend in part on the economic environment, including among things, the housing market and the rates of bankruptcies, which can affect spending on card products and
debt payments by individual and corporate customers;
- Credcos ability to accurately estimate the provision for losses in Credcos outstanding portfolio of cardmember receivables and loans;
- fluctuations in foreign currency exchange rates;
- negative changes in Credcos credit ratings, which could result in decreased liquidity and higher borrowing costs;
- the potential failure of the U.S. Congress to extend the active financing exception to Subpart F of the Internal Revenue Code, which is scheduled to expire at the end of 2008 and could
increase Credcos effective tax rate;
- changes in laws or government regulations affecting American Express Companys business, including the potential impact of regulations proposed by federal bank regulators relating to
certain credit and charge card practices;
- the effect of fluctuating interest rates, which could affect Credcos borrowing costs; and
- the impact on American Express Companys business resulting from continuing geopolitical uncertainty.

- 19 -

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AMERICAN EXPRESS CREDIT CORPORATION

|                                | OTHER REPORTING MATTERSAccounting Developments
      See Recently Issued Accounting
    Standards section of Note 1 to the Consolidated Financial Statements.                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                     
|------------------------------- | --------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
|                                |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                     
|Item 4. CONTROLS AND PROCEDURES
|                                |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                     
|                                | Credcos management, with the participation
        of Credcos Chief Executive Officer and Chief Financial Officer,
        has evaluated the effectiveness of Credcos disclosure controls
        and procedures (as such term is defined in Rules 13a-15(e) and 15d-15(e)
        under the Securities Exchange Act of 1934, as amended (the Exchange
        Act)) as of the end of the period covered by this report. Based
        on such evaluation, Credcos Chief Executive Officer and Chief Financial
        Officer have concluded that, as of the end of such period, Credcos
        disclosure controls and procedures are effective. There have not been
        any changes in Credcos internal control over financial reporting
        (as such term is defined in Rules 13a-15(f) and 15d-15(f) under the Exchange
        Act) during Credcos fiscal quarter to which this report relates
        that have materially affected, or are reasonably likely to materially
    affect, Credcos internal control over financial reporting.

- 20 -

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AMERICAN EXPRESS CREDIT CORPORATION

PART II. OTHER INFORMATIONItem 6. EXHIBITS

The list of exhibits required to be filed as exhibits to this report are listed on page E-1 hereof, under Exhibit Index, which is incorporated herein by reference.

- 21 -

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AMERICAN EXPRESS CREDIT CORPORATIONSIGNATURES

Pursuant to the requirements of the Securities Exchange Act of 1934, the Registrant has duly caused this report to be signed on its behalf by the undersigned, thereunto duly authorized.

AMERICAN EXPRESS CREDIT CORPORATION(Registrant)

|DATE:   August
        5, 2008 |  | By |  | /s/
        Christopher S. Forno                    | 
|------------------------------ |  | -- |  | --------------------------------------------------- | 
|                               |  |    |  | Christopher S.
        Forno                       
|                               |  |    |  | President and
        Chief Executive Officer      
|                              
|                              
|DATE:   August
        5, 2008 |  | By |  | /s/
        Lawrence A. Belmonte                    | 
|                               |  |    |  | Lawrence A. Belmonte                               
|                               |  |    |  | Vice President
        and Chief Accounting Officer

- 22 -

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AMERICAN EXPRESS CREDIT CORPORATION

EXHIBIT INDEXPursuant to Item 601 of Regulation S-K

|             |  | Description                                              |  | How
            Filed         
|------------ |  | -------------------------------------------------------- |  | ------------------------------
|            
|Exhibit 12.1 |  | Computation in Support of
        Ratio of               |  | Electronically filed herewith.
|             |  | Earnings to Fixed Charges
        of American            |  |                               
|             |  | Express Credit Corporation.                              |  |                               
|            
|Exhibit 12.2 |  | Computation in Support of
        Ratio of               |  | Electronically filed herewith.
|             |  | Earnings to Fixed Charges
        of American Express    |  |                               
|             |  | Company.                                                 |  |                               
|            
|Exhibit 31.1 |  | Certification of Christopher
        S. Forno, Chief     |  | Electronically filed herewith.
|             |  | Executive Officer, pursuant
        to Rule 13a-14(a)    |  |                               
|             |  | promulgated under the Securities
        Exchange Act    |  |                               
|             |  | of 1934, as amended.                                     |  |                               
|            
|Exhibit 31.2 |  | Certification of David L.
        Yowan, Chief           |  | Electronically filed herewith.
|             |  | Financial Officer, pursuant
        to Rule 13a-14(a)    |  |                               
|             |  | promulgated under the Securities
        Exchange Act    |  |                               
|             |  | of 1934, as amended.                                     |  |                               
|            
|Exhibit 32.1 |  | Certification of Christopher
        S. Forno, Chief     |  | Electronically filed herewith.
|             |  | Executive Officer, pursuant
        to 18 U.S.C.         |  |                               
|             |  | Section 1350, as adopted
        pursuant to Section     |  |                               
|             |  | 906 of the Sarbanes-Oxley
        Act of 2002.           |  |                               
|            
|Exhibit 32.2 |  | Certification of David L.
        Yowan, Chief           |  | Electronically filed herewith.
|             |  | Financial Officer, pursuant
        to 18 U.S.C. Section |  |                               
|             |  | 1350, as adopted pursuant
        to Section 906 of the  |  |                               
|             |  | Sarbanes-Oxley Act of 2002.                              |  |                               

E-1

---