EXHIBIT 99.1
INFORMATION RELATED TO FORWARD LOOKING STATEMENTS
THIS PRESENTATION INCLUDES FORWARD-LOOKING STATEMENTS, WHICH ARE SUBJECT
TO RISKS AND UNCERTAINTIES. 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. 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. THE COMPANY UNDERTAKES NO OBLIGATION TO UPDATE OR REVISE ANY
FORWARD-LOOKING STATEMENTS. FACTORS THAT COULD CAUSE ACTUAL RESULTS TO DIFFER
MATERIALLY FROM THESE FORWARD-LOOKING STATEMENTS INCLUDE, BUT ARE NOT LIMITED
TO, THE FOLLOWING: THE COMPANY'S ABILITY TO GENERATE SUFFICIENT NET INCOME TO
ACHIEVE A RETURN ON EQUITY ON A GAAP BASIS OF 28 PERCENT TO 30 PERCENT; THE
COMPANY'S ABILITY TO GROW ITS BUSINESS AND MEET OR EXCEED ITS RETURN ON
SHAREHOLDERS' EQUITY TARGET BY REINVESTING APPROXIMATELY 35 PERCENT OF
ANNUALLY-GENERATED CAPITAL, AND RETURNING APPROXIMATELY 65 PERCENT OF SUCH
CAPITAL TO SHAREHOLDERS, OVER TIME, WHICH WILL DEPEND ON THE COMPANY'S ABILITY
TO MANAGE ITS CAPITAL NEEDS AND THE EFFECT OF BUSINESS MIX, ACQUISITIONS AND
RATING AGENCY REQUIREMENTS; CONSUMER AND BUSINESS SPENDING ON THE COMPANY'S
CREDIT AND CHARGE CARD PRODUCTS AND TRAVELERS CHEQUES AND OTHER PREPAID
PRODUCTS AND GROWTH IN CARD LENDING BALANCES, WHICH DEPEND IN PART ON THE
ABILITY TO ISSUE NEW AND ENHANCED CARD AND PREPAID PRODUCTS, SERVICES AND
REWARDS PROGRAMS, AND INCREASE REVENUES FROM SUCH PRODUCTS, ATTRACT NEW
CARDMEMBERS, REDUCE CARDMEMBER ATTRITION, CAPTURE A GREATER SHARE OF EXISTING
CARDMEMBERS' SPENDING, SUSTAIN PREMIUM DISCOUNT RATES ON ITS CARD PRODUCTS IN
LIGHT OF REGULATORY AND MARKET PRESSURES, INCREASE MERCHANT COVERAGE, RETAIN
CARDMEMBERS AFTER LOW INTRODUCTORY LENDING RATES HAVE EXPIRED, AND EXPAND THE
GLOBAL NETWORK SERVICES BUSINESS; THE COMPANY'S ABILITY TO INTRODUCE NEW
PRODUCTS, REWARD PROGRAM ENHANCEMENTS AND SERVICE ENHANCEMENTS ON A TIMELY
BASIS DURING 2006; THE SUCCESS OF THE GLOBAL NETWORK SERVICES BUSINESS IN
PARTNERING WITH BANKS IN THE UNITED STATES, WHICH WILL DEPEND IN PART ON THE
EXTENT TO WHICH SUCH BUSINESS FURTHER ENHANCES THE COMPANY'S BRAND, ALLOWS THE
COMPANY TO LEVERAGE ITS PROCESSING SCALE, EXPANDS MERCHANT COVERAGE OF THE
NETWORK, PROVIDES GLOBAL NETWORK SERVICES' BANK PARTNERS IN THE UNITED STATES
THE BENEFITS OF GREATER CARDMEMBER LOYALTY AND HIGHER SPEND PER CUSTOMER, AND
MERCHANT BENEFITS SUCH AS GREATER TRANSACTION VOLUME AND ADDITIONAL HIGHER
SPENDING CUSTOMERS; THE CONTINUATION OF FAVORABLE TRENDS, INCLUDING INCREASED
TRAVEL AND ENTERTAINMENT SPENDING, AND THE OVERALL LEVEL OF CONSUMER
CONFIDENCE; THE COSTS AND INTEGRATION OF ACQUISITIONS; THE ABILITY TO CONTROL
AND MANAGE OPERATING, INFRASTRUCTURE, ADVERTISING AND PROMOTION EXPENSES AS
BUSINESS EXPANDS OR CHANGES, INCLUDING THE ABILITY TO ACCURATELY ESTIMATE THE
PROVISION FOR THE COST OF THE MEMBERSHIP REWARDS PROGRAM; THE COMPANY'S
ABILITY TO MANAGE CREDIT RISK RELATED TO CONSUMER DEBT, BUSINESS LOANS,
MERCHANT BANKRUPTCIES AND OTHER CREDIT TRENDS AND THE RATE OF BANKRUPTCIES,
WHICH CAN AFFECT SPENDING ON CARD PRODUCTS, DEBT PAYMENTS BY INDIVIDUAL AND
CORPORATE CUSTOMERS AND BUSINESSES THAT ACCEPT THE COMPANY'S CARD PRODUCTS AND
RETURNS ON THE COMPANY'S INVESTMENT PORTFOLIOS; BANKRUPTCIES, RESTRUCTURINGS
OR SIMILAR EVENTS AFFECTING THE AIRLINE OR ANY OTHER INDUSTRY REPRESENTING A
SIGNIFICANT PORTION OF THE COMPANY'S BILLED BUSINESS, INCLUDING ANY POTENTIAL
NEGATIVE EFFECT ON PARTICULAR CARD PRODUCTS AND SERVICES AND BILLED BUSINESS
GENERALLY THAT COULD RESULT FROM THE ACTUAL OR PERCEIVED WEAKNESS OF KEY
BUSINESS PARTNERS IN SUCH INDUSTRIES; AND FLUCTUATIONS IN INTEREST RATES,
WHICH IMPACT THE COMPANY'S BORROWING COSTS AND RETURN ON LENDING PRODUCTS. A
FURTHER DESCRIPTION OF THESE AND OTHER RISKS AND UNCERTAINTIES CAN BE FOUND IN
THE COMPANY'S ANNUAL REPORT ON FORM 10-K FOR THE YEAR ENDED DECEMBER 31, 2005,
AND ITS OTHER REPORTS FILED WITH THE SEC.
- --------------------------------------------------------------------------------
UBS 2006 GLOBAL FINANCIAL SERVICES CONFERENCE
KENNETH I. CHENAULT REMARKS
May 16, 2006
- --------------------------------------------------------------------------------
Talking points prepared for presentation to the UBS 2006 Global Financial
Services Conference by American Express Chairman and Chief Executive Officer
Ken Chenault on May 16, 2006.
[FOR SLIDES ACCOMPANYING THIS PRESENTATION, PLEASE REFER TO THE AMERICAN EXPRESS
COMPANY WEB SITE]
Thank you, Eric. It's a pleasure for me to be here with all of you today.
I'd like to cover two topics with you over the next twenty minutes or so.
First, given that everyone's knowledge of American Express is probably varied,
I'll quickly review our first quarter performance.
After that, I'll spend my time on one of the unique advantages I believe we
have within the payments industry - our spend-centric model.
I'll discuss the differences and advantages of a spend vs. lend-centric model,
as well as discuss two core assets that support our model - our brand and the
continuous innovation we apply to realize our spend potential.
Let me start with our recent performance.
As you've seen by now, our first quarter results maintained the strong
financial and business momentum we've achieved over the past few years.
We met or exceeded each of our on-average-and-over-time financial targets for
EPS growth, revenue growth and return on equity.
Our strong performance is the result of the business building investments
we've made over the last several years, in alignment with our continuing focus
on generating spend.
As you can see here, our bottom-line performance was clearly driven by the
strength of our core business metrics.
Our first quarter results included 16% growth in card billings, a 10% growth
in cards in force, 16% growth in managed cardmember loans* and a 6% increase in
travel sales.
Our earnings were also helped by our best in class credit performance.
Now, as you've probably seen, most card companies saw pretty good earnings
this quarter due to the reserve benefits of last year's U.S. bankruptcy
legislation.
What made our performance stand out, however, was the relative strength of our
volume growth.
We continue to see excellent growth in billings against our major competitors.
Our spend volumes grew at 16%, a very strong performance, particularly when
you consider the high growth we've generated over the last several quarters.
Our growth in receivables also continues to outpace the weaker performance of
our peers.
- -----------
* On a GAAP basis, loan growth was 26% in the first quarter of 2006 versus the
prior year's comparable period.
Our 16% increase* puts us well above the single digit growth rate of every
other major player.
Given that each of these competitors utilizes a lend-centric model and
therefore depends on AR growth to drive revenues, this slide clearly shows the
hurdles they face in generating future top-line performance.
The growth advantage in the quarter was a continuation of the momentum we saw
throughout last year.
The strength of our relative performance in 2005 translated into share gains
for us once again in the U.S., as well as in many international markets.
Within the U.S., we gained share against Visa, Mastercard and Discover when
looking at overall credit and charge spending, and even when including the
fast growing debit segment.
This graph shows our share gains of U.S. purchase volumes but a similar slide
for lending balances would show share gains as well.
While first quarter results are not yet available, the comparisons I showed a
moment ago suggest this trend in share has continued in 2006.
* * * * * * * * * * *
Now, I spend a fair amount of my time in forums such as this one today and in
individual meetings with investors.
And, during just about any of these sessions, a number of common questions
tend to come up.
The number one question that I get, or that Gary or Ron Stovall hear, relates
directly to this slide.
Most people look at these results and say: "OK. Good performance".
Without a pause, however, this comment is then followed by the question: "How
do you keep it up?"
How do you keep growing? How do you continue to separate yourself from the
rest of the pack?
So, this is where I want to start today.
I thought I'd share with you how I think about our ability to grow, and also
about what I think puts us in an advantaged position to sustain this growth
over the moderate to long-term.
I'm going to talk about three of those advantages today, as I believe they
represent core elements of our future growth potential.
The first of these is our spend centric model.
Many of you have probably seen this graphic before.
Our spend-centric model is the core element of our growth strategy and is the
foundation for all of our tactics and plans around the globe.
The components of our model are fairly simple:
- acquire and maintain an attractive customer base;
- generate high levels of spending from that base in order to merit
premium economics from merchants;
- and then continually reinvest these economics back
into superior value for customers and prospects.
We are the only major card issuer to predominantly utilize a spend-centric
model.
- -----------
* On a GAAP basis, loan growth was 26% in the first quarter of 2006 versus the
prior year's comparable period.
As such, the economic advantages of this model become our competitive
advantages in the marketplace.
So what are some of the advantages?
The first benefit is the higher spend velocity generated by this type of
model.
Spend velocity is a ratio of card volumes to receivable balances, and is an
indicator of capital utilization.
As you can see, among major players we are the clear leader in this metric.
In our worldwide charge and lending businesses we currently generate more than
6 dollars of spend for every dollar of receivables.*
This result is driven by our high spending proprietary card base, as well as
by the acceleration of billings within our network business.
As a result of this high level of spend, the growth of our card business
requires far less capital than that of a lend-focused issuer.
Moving from the balance sheet to the income statement, the advantages of our
model continue to play out.
Comparing our average spend and economics against the spend and economics of a
lend based competitor, we also see an advantage when it comes to
profitability.
Our higher spend, premium discount rate, and higher level of card fees give us
an overall revenue advantage.
While our proportion of spread revenues and back end fees are clearly not as
high as our competitors, our funding costs are also proportionately less given
the higher velocity of our receivables.
On the expense side of the ledger, our cost to acquire a card and the ongoing
support of our product value propositions are both relatively higher, as you
would expect.
This is partially offset, however, by lower proportionate provision and
interest costs given the pay in full nature of our charge products.
Net, net, our overall profit per account does give us an earnings advantage
against our lend-based peers.
Since less capital is required to support our business, and our profitability
is higher, our return on equity is significantly higher than that of
lend-based competitors.
While it is difficult in some cases to determine the standalone ROE of the
card segments of individual competitors, in aggregate we believe the returns
of our spend-centric model are significantly higher than a lend-based
portfolio.
The ultimate benefactors of our economic advantages are clearly our
shareholders, who are able to see a higher valuation of their investment.
This scatter diagram graphs the quarterly valuation and return metrics of a
broad set of financial services companies over a 12 year period.
The strong correlation between ROE and valuation indicates that for every 1%
lift in ROE, shareholders gain a 5% lift in investment value.
- -----------
* Spend velocity determined using average GAAP (i.e., owned) receivables was
8.1:1 for 2005.
So, as you can see, a spend centric model includes a number of economic
advantages, advantages that are uniquely ours given the lend-based competitive
set we face in the marketplace. It's because of our spend focus that we also
have a different outlook on the growth potential within the industry.
A number of my peers have stated that they view the card industry as mature,
and they've used this as a rationale for diversifying into other business
lines.
I take a different view. I don't believe the card industry is mature; in fact,
I believe it holds a lot of long-term potential.
The difference here is that my viewpoint is shaped by looking at overall SPEND
potential, whereas my peers are looking at LEND potential.
If I ran a lend-based competitor and looked at an economic projection that
showed a 2% to 3% long-term growth rate for lending balances, I'd probably
also be looking for different sources of growth.
With a lend-based focus, once an existing customer hits his or her credit
limit, growth can only come by adding new customers with new balances.
This puts lend-based players on an acquisition treadmill, one that leads to
higher and higher volumes of direct mail, offering products at lower and lower
- - and finally zero - yield.
With this type of model, growth essentially becomes bounded, leading to a
perception that the market is mature.
A spend-based model doesn't have the same limitations.
As long as the potential for consumer and business spend increases, we have
the potential for growth.
First, there's the base level of growth expected across the economy.
As an example, in the U.S. over the next 5 years, consumer spend is expected
to be up 5% per year.
On top of this, you then layer on the opportunities for increased share of
plastic spend.
Plastic has gradually shifted share from cash and checks over the last 10
years, and this trend is expected to continue.
In fact, plastic's share of total U.S. consumer payments is expected to
increase from 38% of expenditures to 48% by the end of the decade, adding over
$1.5 trillion of growth potential.
That example is for U.S. consumers, but other segments and geographies offer
even greater potential.
For example, U.S. small businesses only put 15% of their spending on plastic,
Middle Market companies less than 10%, and International consumers less than
25%.
So far from seeing a mature industry, I see growth opportunities,
opportunities that I believe we're in a unique position to capitalize on
because of our spend-based model.
I don't want to imply, however, that just because we have a unique model that
our growth is on auto-pilot.
Yes, overall spend potential will grow in the future, but we know we're going
to have to compete aggressively every day to continue to grow market share.
We're helped in this fight by two important assets that work in alignment
with, and in support of, our spend model.
The first of these is our brand.
Our brand is a critical component of our business model.
It is globally recognized, it has distinctive attributes within the industry
and it is a unique asset that competitors can't replicate.
Now, I know that some people don't place great value on brands.
They say we're now in one of those cycles where cards are a commodity and
brands are less relevant.
As you might imagine, I disagree pretty strongly with that view.
I believe that brands will always matter, and that strong brands are direct
contributors to business growth and growth potential.
Given the company I lead this view probably doesn't surprise you.
American Express, after all, is a brand-based company.
Over the course of our 156 year history, our brand has become an icon.
The compound impact over the years of everything from Karl Malden, to the
mystique of our Black Card, to being a plot point on the Sopranos has made our
brand one of the most valued in the world.
A recent global brand ranking by Interbrand places our brand value in 14th
position, a disproportionately high ranking relative to our placement of 174
on the Fortune Global 500.
Our brand also has what Warren Buffett has referred to as "share of mind" of
customers and prospects.
It stands for attributes that have meaning to people, in addition to setting
an expectation.
Brands are generally defined along three parameters:
- the rational value provided by the branded product,
- the customer experience when using the product,
- and the emotional affinity or relationship established with
the company.
Brand value is built by focusing on any of these three components, but great
brands have strengths along all three axes at the same time.
As you can imagine, I believe our brand falls into this latter category.
The rational value generated by our rewards programs, co-brands or revolve
terms is supported by a strong service experience, which leads to the
emotional affinity customers have for our company - whether the result of our
premium positioning, the "home away from home" security we provide or the
customer advocacy we maintain.
By strengthening each leg of this triangle we've been able to build upon the
historical value of our brand and grow both its tangible and intangible value.
In fact, within our peer group, it is difficult to think of a competitor whose
brand resonates with people to the extent that our does.
Whether, as an example, we look at Visa on the network side of the business,
or Cap One on the issuer side, I don't believe the attachment and "share of
mind" that people have for our brand has been equaled.
Over our company's history our brand has, of course, evolved in different
ways.
Our premium positioning has generally remained unchanged over time.
Our brand has been synonymous with this segment as a result of all three brand
elements - the rational value of our product propositions, the customer
experience we provide, and the emotional aspiration of success associated with
our products.
This positioning has a strong "pull" effect among both existing customers and
prospects.
It's what allows us to offer the most premium product in the market - our
$2500 Centurion product - by invitation only, without spending ANY investment
dollars on acquisition marketing.
But, as I said, the rational element of our brand is also an important element
of the equation.
A premium product requires proportionate value so, in addition to the service
and benefits offered by our products, we have also created and refined the
broadest loyalty program in the marketplace.
Membership Rewards is an important element of our premium value proposition,
and it is also a program that supports several of our brand attributes such as
customer commitment and quality. Our MR program continues to grow in terms of
partners and enrolled cards, and it is at the center of our spend-centric
focus.
Over this 3 year time period spending within the MR program increased by more
than 75%.
This benefits us not just in higher overall spend, but also in lower A/R days,
better credit performance and better cardmember retention.
But, as I said earlier, our brand has evolved.
And, over the last 10 years we have actively worked to expand its relevance
beyond our traditional T&E-centric charge cards.
To do this we developed a broad and innovative product portfolio, including
cards with different functionality and utility in order to appeal to a wider
audience of prospective customers.
Beginning with the introduction of Blue from American Express, and then with
products such as Costco, Jet Blue and the other cards you see here, we
broadened our brand definition to be relevant to a different demographic,
including customers who want the option to revolve.
This has been true in markets around the world, and I believe it demonstrates
our ability to effectively leverage and expand our brand and have it resonate
outside of its original core customer.
Now, I've made this sound simple, but expanding the relevance of our brand and
our products was the result of a lot of hard work.
For example, one critical task in making our products more relevant was
changing both the reality and the perception that our products were used only
for T&E spending.
To do this we had to move into new merchant categories, sign key accounts and
communicate our actions to our card base and to prospects.
It was not an easy task, but as you can see here we've succeeded at
significantly changing our spend profile.
Where we once had only one third of billings outside of the T&E category, that
percentage has now shifted to two thirds as we increased our acceptance into
retail locations, supermarkets and drug stores.
As we expanded our franchise into lending products and everyday spend over the
last 10 years, our brand proved its flexibility and expanded with us.
It is now more vibrant and relevant than ever, increasing its value to our
company and directly contributing to the growth of our global payments
business.
Another core asset that supports and contributes to our spend-centric model
and our brand is our ability to innovate.
The payments industry is consistently evolving, and any company that stands
still is essentially moving backwards.
We've made a conscious choice to be among the leaders in this business and, as
a result, we've significantly invested in innovation across several axes.
The most noticeable form of innovation is product development and, as you saw
before, we've been quite active on this front.
This is just a sampling of the proprietary products we've launched here in the
U.S.
(A complete visual of our global launches over the last three years would
include over 400 new and enhanced proprietary and network products.)
As this slide shows, we've gained relevance outside of our core charge card
demographic by continually improving our targeting and segmentation.
We've focused on key groups of prospects and developed products relevant to
them -- for example, younger, city residents targeted by our In:NYC, LA or
Chicago cards, or those looking to add to their savings through the automatic
deposits of our American Express One product.
But new products are just one element of innovation.
We've also invested in process innovation to improve our cost efficiency and
improve our service.
To this end, we've focused on technology innovation and, specifically, on-line
technology.
We've expanded our internet capabilities to the point where we now have more
web interactions with customers than we do via the phone.
From redeeming Membership Reward points to making a payment, over 80% of our
service transactions are now available, and actively being used, online.
In addition to servicing, we continue to enhance our online acquisition
capabilities.
After the launch of our new home page in the third quarter last year, the
number of consumer cards we acquired online increased 80% above any previous
quarter.
Another area of innovation has been cardmember benefits.
We continually work to enhance the value of our products, and one of the most
popular and relevant has been advantaged access.
Through relationships with concert promoters, entertainment venues and
Broadway theaters, we've been able to offer our cardmembers unique access to a
range of entertainment experiences.
By leveraging our merchant relationships and our premium card base, we've been
able to offer value propositions that benefit both constituencies.
Cardmembers get early access to high-demand events, while merchants get
advanced ticket sales and cash flow from a high-quality, highly involved
customer base.
Examples of this win-win proposition include the recent Broadway runs of The
Odd Couple and Three Days of Rain, both of which were essentially sold out to
our cardmember base.
Finally, we've also worked to innovate our customer experience.
One great example of this has been the "My Wish List" program we launched
online in the U.S. last year.
My Wish List is a customer benefit where cardmembers have an exclusive
opportunity to purchase limited-supply,premium items or experiences from
merchants or manufacturers.
Our promotion in the fourth quarter drew more than 7 million site visits with
extremely high repeat rates.
More than 20% of our existing U.S. consumer and small business cardmembers
visited the "My Wish List" site.
And, in terms of benefits to our merchants, some participating merchants saw
transaction sizes that were close to double their overall average.
This unique customer experience was available to all American Express
cardmembers, both proprietary and holders of American Express branded cards
issued by our bank partners.
By providing an innovative online experience, and by leveraging our closed
loop relationships, we were able to successfully enhance each element of our
brand triangle with both cardmembers and merchants - rational value, the
customer experience and emotional affinity.
So, our spend-centric model, supported by an ever-strengthening brand and a
range of innovations, has been at the core of our strategy over the last
several years.
But while many, if not most, business strategies sound good in theory, they
are proved or disproved in the marketplace.
So, moving from theory to reality, how has our spend-centric model performed?
Looking back just 6 years ago, the U.S. card market was quite a different
place.
The industry was having a terrific year, with almost all players seeing strong
double digit growth.
Our absolute growth of 19% in the U.S. was pretty strong, but on a relative
basis we were only in the middle of the pack.
Five years later, by aggressively developing and implementing our
spend-centric model, we've made significant progress.
We lead the industry in terms of global billings, and have established a
sizable, positive gap between ourselves and the rest of the now-consolidated
industry.
The same picture can be seen within lending.
In 2000 the industry was growing exceptionally fast and, while our managed
balances in the U.S. were up 23%*, we were just managing to stay in line with
the industry average.
By 2005 the change in industry performance, and our own relative performance,
was pretty striking.
Even as growth in AR balances slowed dramatically across the industry versus
2000, our spend-centric focus enabled us to outgrow our major competitors by a
wide margin.
As I've mentioned before, loan balances are an outcome of our spend-focus, not
an objective.
By offering strong value propositions, expanded relevance and flexible options
to our cardmembers, our spend focus has allowed us to significantly grow our
managed balances, while maintaining industry leading credit quality and
without being overly reliant on balance transfer offers.
For me, all of the elements I've discussed - our spend-centric model, our
brand and our market innovations - come together in this slide.
Given our business model, our most significant metric is average spending per
card.
It is the indicator that best assesses the health of our franchise and the
impact of our strategy.
On this graph both the absolute level of our gap against the associations, as
well as the direction of the line, clearly indicate that, contrary to the
press releases of Visa and Mastercard, our position as the network of choice
for high spenders remains unchanged.
In closing, let me just say that I remain quite confident in both the
direction and the execution of our spend-centric strategy.
To me it comes down to results and growth potential.
In terms of results, the strength and vibrancy of any strategy or any brand is
best judged by strong organic growth, and against that benchmark our
performance is unequaled by any major player.
In terms of growth, I believe the potential for our future performance remains
strong.
Competitors may attempt to copy specific elements of our products, but our
business model, innovation and long-established brand remain unique.
Each of these assets differentiates our company in the marketplace, and each
provides a competitive advantage that is difficult to replicate.
We've got the momentum, talent and business foundation to generate strong
shareholder value.
And I believe we will continue to do so.
Thank you.
QUESTION AND ANSWER
- ----------
* On a GAAP basis, loan growth was 8% in 2000 versus 1999.