American Express said the Treasury had provided preliminary approval for it to participate in the Treasury's $700 billion Troubled Asset Relief Program Capital Purchase Program.
"American Express expects to issue and sell to the Treasury preferred stock of approximately $3.4 billion and warrants to purchase shares of common stock for up to 15 per cent of that amount,'' the company said.
The preferred shares will pay dividends at a rate of five percent annually for the first five years and then 9 per cent annually thereafter, a company statement said.
The United States Federal Reserve approved the company's application to become a bank holding company last month.
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