New York, Jan 12, 2026, 17:50 ET — Trading after hours.
American Express shares fell 4.3% in after-hours trading Monday, following President Donald Trump’s call for a one-year cap on credit card interest rates at 10%. The stock last changed hands at $359.59, down $16.10 from its previous close, after dipping as low as $355.50 earlier in the session.
The concern is straightforward: card lenders earn big when users carry balances, and a strict cap would quickly crush those profits. The selloff dragged down the entire credit sector, with Synchrony Financial, Bread Financial, and Capital One sliding 8% to 11%, while Visa and Mastercard each dropped about 1.8% in early trading. UBS Global noted that imposing such a cap would require “an Act of Congress,” and Seaport Research’s Bill Ryan pointed out that “affordability” has become a key issue for U.S. voters. Reuters
Even without becoming law, the headline grabs attention by reviving the debate over pricing power and consumer debt politics. Credit card rates hover around 19.65%, per Bankrate, while balances have surged to $1.23 trillion, Reuters reports, putting lenders at risk if lawmakers push harder. Jefferies flagged that cutting back on card lending might weigh on consumption and “hurting GDP,” and Truist warned the cap could push the business into unprofitable territory for subprime borrowers—those with weaker credit histories. Reuters
American Express occupies a tricky position in this debate. Unlike Visa or Mastercard, which mainly act as toll-collectors, Amex also extends credit to cardmembers and holds that risk on its balance sheet.
This 10% cap issue isn’t just a one-quarter blip; it’s a fundamental problem with the model. When lenders can’t price risk properly, they typically respond by tightening credit—slashing limits, rejecting riskier borrowers, and stripping back perks wherever possible.
For AmEx, the focus shifts to its rewards and premium ecosystem: airline points, hotel stays, the full package. These programs aren’t cheap—they rely on a blend of merchant fees and interest income to stay afloat.
The downside risk remains political and procedural. If the cap stays just talk, it could disappear as fast as it showed up. But if it becomes an actual bill, that shifts the game. Then the market would need to start pricing in earnings hits rather than just brushing off headlines.
Traders in the next session will look for a concrete path—whether draft legislation, agency guidance, or a clear hint that the administration intends to pressure lenders beyond public statements. Until then, the sector will keep swinging with each fresh update from Washington.
American Express is set to report fourth-quarter and full-year 2025 earnings on Jan. 30 at 8:30 a.m. ET. Investors will be watching closely for any early signs on spending patterns and insights into how the ongoing rate-cap battle might affect lending and credit quality.
