Snapshots

By The Associated Press - 11/02/2008

Banks asking for debt forgiveness WASHINGTON (AP) — With defaults on credit card debt spiraling amid a global financial downturn, banks already reeling from the mortgage crisis are losing billions more from unpaid credit card bills.

Big banks have formed an unusual alliance with consumer advocates to urge the government to allow huge portions of credit card debt to be forgiven, a turnabout from recent years when the banking industry lobbied strenuously to make it harder for consumers to erase their credit card debts in bankruptcy. The new pilot program — which the banks hope will become permanent — could involve as many as 50,000 people struggling with credit card debt.

American Express to cut 7,000 jobs NEW YORK (AP) — In a stark acknowledgment of the tough times ahead in the credit card industry, American Express Co. said Thursday that it plans to cut 7,000 jobs, or about 10 percent of its worldwide work force, in an effort to slash costs by $1.8 billion in 2009.

The New York-based credit card issuer — which has reported four straight quarters of profit declines as an increasing number of consumers struggle to pay off debt — said it is also suspending management-level salary increases next year and instituting a hiring freeze.

The job cuts will be across various business units, but will primarily focus on management positions, the company said.