Moody's downgrades American Express on weaker revenue

NEW YORK, April 24 (Reuters) - Moody's Investors Service on Friday downgraded its ratings on American Express Co (AXP.N) after the credit card company posted sharply lower first-quarter earnings as it struggled with bad loans.

Moody's cut its senior long-term debt on American Express by one notch to A3, the seventh-highest investment grade, from A2. The short-term rating was lowered to Prime-2 from Prime-1. Moody's said the outlook for the long-term ratings of American Express is negative, indicating another rating cut is likely over the next 12 to 18 months.

The downgrades reflect the erosion of the company's asset quality and weaker revenue trends stemming from the severe U.S. recession, Moody's said in a statement. (Reporting by Dena Aubin; Editing by Padraic Cassidy) (dena.aubin@thomsonreuters.com; +1-646-223-6325; Reuters Messaging: dena.aubin.reuters.com@reuters.net))