Standard & Poor's (S&P) Ratings Services cut long-term ratings for American Express Co. to "A" from "A+". The awarded rating is considered to be an investment grade, as well.

Commenting on the issue the agency said it had lowered the rating due to such reasons as: expectations of further weakening in consumer credit quality, rising losses on the lender's credit card portfolio and its high concentration of funding through wholesale markets.

Moreover, the agency stated that the change in rating also reflects S&P's expectation for higher risk among financial institutions because of recession and global economic slowdown.

Specialists expect losses on credit card loans to continue rising in 2009, as more consumers are facing the negative outcomes of economic slowdown including unemployment.

American Express used to generate funding by packaging credit card loans into securitizations and selling them to investors. Nevertheless, due to defaults among almost all types of loans having risen, investors are not willing to purchase securities in such markets anymore.

Consequently, American Express has changed its structure recently to become a bank holding company, in order to provide a wider access to new programs on government lending.

Furthermore, S&P confirmed American Express' short-term ratings at "A-1."

The prices for shares of American Express in pre-market trading decreased by 3 cents and now them make $19.40.