The company said the $265 million worth of reserves and write-offs would include $155 million in expected defaults, mostly from the Optima card.

Neither the blue nor the Optima cards, unlike those of other colors, carries an annual fee.

And recently American Express introduced its Optima card, with a 13.5 percent interest rate.

In 1987, American Express introduced a credit card, known as the Optima card.

With the prime now at 8.75 percent, that would mean a rate on the Optima card of 15.75 percent.

The new Optima card has a number of drawbacks.

American Express, for example, has changed the ground rules on its Optima card twice in recent months.

The Optima card, with a 13.5 percent annual interest rate, will be offered to 10 million American Express customers nationwide.

In 1987, American Express introduced the Optima card, their first credit card product.

Loan balances on its Optima cards increased by 28 percent in the fourth quarter from a year earlier, to $12.7 billion.