American Express Issues $1.6 Billion Preferred Stock Series E, Plans Series D Redemption
The financial services giant completes a preferred share issuance carrying a 6.450% dividend rate while simultaneously announcing plans to redeem its existing Series D preferred shares next month.
American Express Executes Capital Structure Refinancing
American Express Company (AXP) has completed the issuance of 1,600 shares of 6.450% Fixed Rate Reset Noncumulative Preferred Shares, Series E, according to an 8-K filing submitted August 12, 2026. The transaction, which closed on August 12, involved depositary shares representing fractional interests in the preferred stock, raising approximately $1.6 billion in proceeds.
Each of the 1,600,000 depositary shares issued represents a 1/1,000th interest in a Series E preferred share, with each underlying preferred share carrying a liquidation preference of $1,000,000 (8-K filing, 2026-08-12). The offering was underwritten by a syndicate led by Barclays Capital, BofA Securities, and Citigroup Global Markets, among others, pursuant to an underwriting agreement dated August 5, 2026.
Dividend Payment Restrictions
The new Series E preferred shares impose significant restrictions on American Express's ability to manage its capital structure. Under the terms outlined in the filing, if the company "fails to declare and pay full dividends (or declare and set aside a sum sufficient for payment thereof)" on the Series E shares, it will face limitations on its ability to declare or pay dividends on common stock or redeem other securities ranking on parity with the Series E shares (8-K filing, 2026-08-12).
These restrictions specifically apply to the company's common shares and other preferred shares ranking equally with Series E, including the existing Series D preferred shares.
Series D Redemption Planned
Concurrently with the Series E issuance, American Express announced plans to redeem its outstanding Series D preferred shares. The company stated it "plans to send a redemption notice to the holders of the depositary shares" representing interests in Series D preferred stock, "which will result in the redemption in full on September 15, 2026" (8-K filing, 2026-08-12).
The aggregate redemption price will equal $1,000,000 per share of Series D preferred stock, equivalent to $1,000 per depositary share, plus any declared and unpaid dividends. The Series D shares, which carry a 3.550% dividend rate, were originally issued in August 2021.
Strategic Implications
The transaction effectively replaces lower-yielding preferred equity with higher-yielding securities, reflecting the changed interest rate environment since the Series D issuance five years ago. The 6.450% dividend rate on the new Series E shares represents a 290 basis point premium over the 3.550% rate on the Series D shares being redeemed.
American Express filed a Certificate of Amendment with the New York Secretary of State on August 11, 2026, to amend its certificate of incorporation and establish the designations and rights of the Series E preferred shares. Computershare Inc. and Computershare Trust Company serve as depositary, calculation agent, and transfer agent for the new securities.
The filing included standard forward-looking statement disclaimers and noted that the 8-K "does not constitute a notice of redemption" for the Series D securities (8-K filing, 2026-08-12).
According to MarginX data, American Express is scheduled to report third-quarter 2026 results on October 23, with the redemption of Series D shares occurring well before that reporting date.
This article was generated by MarginX from the 8-K filing on 2026-08-12. It is not investment advice.