(Adds details, background on Tax Act)
Jan 3 (Reuters) - American Express Co said it
expects to report a fourth-quarter loss due to a $2.4 billion
hit from the tax legislation which makes it cheaper for U.S.
companies to repatriate profits.
The company also said it expects full-year 2017 earnings to
be below its $5.80-$5.90 per share forecast. (http://bit.ly/2CyIWfT)
The impacts of the tax act in the fourth quarter will reduce
American Express' regulatory capital and capital ratios for the
fourth quarter, the company said.
In the long run, AmEx expects the lower corporate tax rate
to be a significant benefit. The company anticipates effective
tax rate in the low twenties before discrete tax items in 2018.
Congress' U.S. tax overhaul bill, which President Donald
Trump signed into law last month, significantly cuts the
corporate tax rate to 21 percent from 35 percent.
According to the new law, profits brought back to the United
States would not be taxed at the full 35-percent corporate tax
rate that would normally be due. Instead, those profits would be
taxed at only 15.5 percent for cash assets and 8 percent for
Goldman Sachs Group Inc said last week it also
expects fourth-quarter earnings to decrease by about $5 billion
due to the tax legislation.
(Reporting by Nikhil Subba in Bengaluru; Editing by Shounak
First Published: 2018-01-03 22:17:39
Updated 2018-01-03 22:32:31
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