NEW YORK (Fortune) -- In a strange turn of events, American Express is trying to run off some of the customers it went out of its way to attract earlier this decade.

The credit card company was a major beneficiary of the economic boom earlier this decade. AmEx (AXP, Fortune 500) card use grew at a remarkable 15% annually on average between 2002 and 2007, as American Express spent heavily to attract new users and customers of all stripes purchased more. Peers such as Discover (DFS) struggled to grow half as fast.

But with the global economic bust well into its second year and more borrowers slipping behind on their payments, AmEx's rapid growth is being viewed in a less flattering light. Shares recently hit a 14-year low, prompting billionaire investor Warren Buffett -- whose Berkshire Hathaway (BRKA, Fortune 500) owns 13% of the New York-based company -- to pronounce the stock "a hell of a buy at $10."

"American Express is going to be around forever," Buffett said in an interview with CNBC Monday. "They've got the cream of cardholders. Unfortunately, they have some cardholders that aren't the cream, too."

It's the latter group that's getting the lion's share of the attention lately. AmEx last month offered to pay a small number of cardholders $300 each to pay off their account balances and close the accounts by the end of April.

Analysts say the company, confronting soaring default rates on its cards, is trying to limit the damage to its own finances while cutting ahead of rivals in line to be paid back. The default rate on AmEx cards soared to 8.3% in January from 4.7% a year earlier, according to data from the trust that handles the company's consumer lending receivables.

American Express "appears to be going to great length to reduce its exposure to the unfolding consumer credit downturn," wrote Bank of America analyst Kenneth Bruce in a report last month. He added that the company is probably targeting "cardholders with sizable outstanding balances and a higher risk of default."

AmEx hasn't revealed details of the offer and didn't respond to requests for comment. But it is an unusual move for a company that has spent years burnishing its image as the credit card issuer of the jet set.

"A company like American Express that has built its reputation on premium service, concierges and exclusive art event invitations now appears to be penny pinching when times are tough," said Leslie Gaines-Ross, chief reputation strategist at public relations firm Weber Shandwick in New York.

Further complicating matters is American Express' decision to take $3.4 billion in federal assistance in January under the Treasury's Troubled Asset Relief Program, or TARP.

Companies receiving TARP funding don't have to promise to increase lending. But with the bill for the government's economic stimulus and financial stability plans running into the trillions of dollars, there has been talk in Washington of explicitly linking new federal aid to the flow of funds from banks to consumers and businesses.

Meanwhile, American Express was pulling back even before the bottom fell out of the economy last fall.

"As we had expected, late payments and write-offs in our charge card and lending portfolios increased throughout the year," said AmEx CEO Ken Chenault in his 2008 letter to shareholders. "We took steps to manage the increased risk, such as selectively reducing lines of credit."

AmEx isn't the only credit card issuer to be reducing credit lines and closing unused accounts, analysts say.

"There is a whole new world out there," said Linda Sherry, the director of national priorities at advocacy group Consumer Action. "In some ways we think it's sensible for there to be less credit available, but we can't agree with how the card companies have been doing it."

The pullback at American Express comes after a long push to bring in new customers. In 2007, the company's marketing spending surged 20% from a year ago, as part of what Chenault has called AmEx's "multi-year investment strategy."

While the cardholder buyout offer may raise some eyebrows, the main question on Wall Street is whether it will work. Bank of America's Bruce raises the prospect of adverse selection -- the prospect that American Express could end up buying out better customers, leaving more of those less able to pay.

Still, given how sharply defaults have risen and the other dour economic trends in place, others see no harm in trying something new.

"Drastic times call for drastic measures," said Michael Taiano, an analyst at Sandler O'Neill in New York who rates American Express stock a hold. "This is just one of the tools they're testing out."