COF
$78.02
Capital One Financial
$1.11
1.44%
Earnings Details
3rd Quarter September 2018
Tuesday, October 23, 2018 4:05:00 PM
Tweet Share Watch
Summary

Capital One Financial Beats

Capital One Financial (COF) reported 3rd Quarter September 2018 earnings of $3.12 per share on revenue of $8.1 billion. The consensus earnings estimate was $2.89 per share on revenue of $6.9 billion. The Earnings Whisper number was $2.82 per share. Revenue grew 4.8% on a year-over-year basis.

Capital One Financial Corp is a financial services holding company. The Company with its banking and non-banking subsidiaries markets financial products and services.

Results
Reported Earnings
$3.12
Earnings Whisper
$2.82
Consensus Estimate
$2.89
Reported Revenue
$8.07 Bil
Revenue Estimate
$6.88 Bil
Growth
Earnings Growth
Revenue Growth
Power Rating
Grade
Earnings Release

Capital One Reports Third Quarter 2018 Net Income of $1.5 billion, or $2.99 per share

MCLEAN, Va., Oct. 23, 2018 /PRNewswire/ -- Capital One Financial Corporation (NYSE: COF) today announced net income for the third quarter of 2018 of $1.5 billion, or $2.99 per diluted common share, compared with net income of $1.9 billion, or $3.71 per diluted common share, in the second quarter of 2018, and with net income of $1.1 billion, or $2.14 per diluted common share, in the third quarter of 2017. Excluding adjusting items, net income for the third quarter of 2018 was $3.12 per diluted common share(1).

Capital One

"Our digital and technology transformation is accelerating, and is powering our ability to grow new customer relationships and deepen engagement with new and existing customers," said Richard D. Fairbank, Founder, Chairman and Chief Executive Officer. "We continue to build an enduringly great franchise with the scale, brand, capabilities, and infrastructure to succeed as the digital revolution transforms our industry and our society."

Adjusting items in the third quarter of 2018, which are excluded from diluted EPS and efficiency ratio metrics (see Table 15 in our Financial Supplement for additional information):









Pre-Tax

Diluted EPS

(Dollars in millions, except per share data)

Impact

Impact

Net gains on the sales of exited businesses

$

141


$

0.22


Legal reserve build

(170)


(0.35)


Notable item in the third quarter of 2018 included:









Pre-Tax

Diluted EPS

(Dollars in millions, except per share data)

Impact

Impact

Investment portfolio impairment charges

$

(200)


$

(0.32)




(1) 

Amounts excluding adjusting items are non-GAAP measures that we believe help investors and users of our financial information understand the effect of adjusting items on our selected reported results and provide alternate measurements of our performance. See Table 15 in Exhibit 99.2 for a reconciliation of our selected reported results to these non-GAAP measures.

All comparisons below are for the third quarter of 2018 compared with the second quarter of 2018 unless otherwise noted.

Third Quarter 2018 Income Statement Summary:

  • Total net revenue decreased 3 percent to $7.0 billion.
  • Recognized net gains of $141 million on the sales of exited businesses.
  • Total non-interest expense increased 10 percent to $3.8 billion:
    • 9 percent increase in operating expenses.
    • 19 percent increase in marketing.
  • Pre-provision earnings decreased 15 percent to $3.2 billion(2).
  • Provision for credit losses decreased 1 percent to $1.3 billion:
    • Net charge-offs of $1.4 billion.
    • $157 million reserve release.
  • Net interest margin of 7.01 percent, up 35 basis points.
  • Efficiency ratio of 54.19 percent.
    • Efficiency ratio excluding adjusting items was 52.70 percent(1).
  • Operating efficiency ratio of 46.95 percent.
    • Operating efficiency ratio excluding adjusting items was 45.29 percent(1).

Third Quarter 2018 Balance Sheet Summary:

  • Common equity Tier 1 capital ratio under Basel III Standardized Approach of 11.2 percent at September 30, 2018.
  • Period-end loans held for investment in the quarter increased $2.6 billion, or 1 percent, to $238.8 billion.
    • Credit Card period-end loans increased $908 million, or 1 percent, to $110.7 billion.
      • Domestic Card period-end loans increased $850 million, or 1 percent, to $101.6 billion.
    • Consumer Banking period-end loans increased $602 million, or 1 percent, to $59.3 billion:
      • Auto period-end loans increased $641 million, or 1 percent, to $56.4 billion.
    • Commercial Banking period-end loans increased $1.1 billion, or 2 percent, to $68.7 billion.
  • Average loans held for investment in the quarter decreased $4.0 billion, or 2 percent, to $236.8 billion.
    • Credit Card average loans increased $1.6 billion, or 1 percent, to $109.5 billion.
      • Domestic Card average loans increased $1.7 billion, or 2 percent, to $100.6 billion.
    • Consumer Banking average loans decreased $7.3 billion, or 11 percent, to $59.2 billion:
      • Auto average loans increased $999 million, or 2 percent, to $56.3 billion.
      • Home loans average loans decreased $8.1 billion, or 100 percent, driven by the timing of the sale of substantially all of our consumer home loan portfolio.
    • Commercial Banking average loans increased $1.7 billion, or 3 percent, to $68.0 billion.
  • Period-end total deposits decreased $1.0 billion, or less than 1 percent, to $247.2 billion, while average deposits decreased $2.1 billion, or 1 percent, to $246.7 billion.
  • Interest-bearing deposits rate paid increased 11 basis points to 1.23 percent.

Earnings Conference Call Webcast Information

The company will hold an earnings conference call on October 23, 2018 at 5:00 PM Eastern Time. The conference call will be accessible through live webcast. Interested investors and other individuals can access the webcast via the company's home page (www.capitalone.com). Choose "About Us," then choose "Investors" to access the Investor Center and view and/or download the earnings press release, the financial supplement, including a reconciliation of non-GAAP financial measures, and the earnings release presentation. The replay of the webcast will be archived on the company's website through November 6, 2018 at 5:00 PM Eastern Time.

Forward-Looking Statements

Certain statements in this release may constitute forward-looking statements, which involve a number of risks and uncertainties. Capital One cautions readers that any forward-looking information is not a guarantee of future performance and that actual results could differ materially from those contained in the forward-looking information due to a number of factors, including those listed from time to time in reports that Capital One files with the Securities and Exchange Commission, including, but not limited to, the Annual Report on Form 10-K for the year ended December 31, 2017.

About Capital One

Capital One Financial Corporation (www.capitalone.com) is a financial holding company whose subsidiaries, which include Capital One, N.A., and Capital One Bank (USA), N.A., had $247.2 billion in deposits and $362.9 billion in total assets as of September 30, 2018. Headquartered in McLean, Virginia, Capital One offers a broad spectrum of financial products and services to consumers, small businesses and commercial clients through a variety of channels. Capital One, N.A. has branches located primarily in New York, Louisiana, Texas, Maryland, Virginia, New Jersey and the District of Columbia. A Fortune 500 company, Capital One trades on the New York Stock Exchange under the symbol "COF" and is included in the S&P 100 index.

(1)

Amounts excluding adjusting items are non-GAAP measures that we believe help investors and users of our financial information understand the effect of adjusting items on our selected reported results and provide alternate measurements of our performance. See Table 15 in Exhibit 99.2 for a reconciliation of our selected reported results to these non-GAAP measures.

(2)

Pre-provision earnings is calculated based on the sum of net interest income and non-interest income, less non-interest expense for the period.

 

Exhibit 99.2



Capital One Financial Corporation

Financial Supplement(1)(2)

Third Quarter 2018

Table of Contents


Capital One Financial Corporation Consolidated Results

Page


Table 1:

Financial Summary—Consolidated

1


Table 2:

Selected Metrics—Consolidated

3


Table 3:

Consolidated Statements of Income

4


Table 4:

Consolidated Balance Sheets

6


Table 5:

Notes to Financial Summary, Selected Metrics and Consolidated Financial Statements (Tables 1—4)

8


Table 6:

Average Balances, Net Interest Income and Net Interest Margin

9


Table 7:

Loan Information and Performance Statistics

10


Table 8:

Allowance for Loan and Lease Losses and Reserve for Unfunded Lending Commitments Activity

12

Business Segment Results



Table 9:

Financial Summary—Business Segment Results

13


Table 10:

Financial & Statistical Summary—Credit Card Business

14


Table 11:

Financial & Statistical Summary—Consumer Banking Business

16


Table 12:

Financial & Statistical Summary—Commercial Banking Business

17


Table 13:

Financial & Statistical Summary—Other and Total

18

Other



Table 14:

Notes to Loan, Allowance and Business Segment Disclosures (Tables 7—13)

19


Table 15:

Calculation of Regulatory Capital Measures and Reconciliation of Non-GAAP Measures

20





__________


(1)

The information contained in this Financial Supplement is preliminary and based on data available at the time of the earnings presentation. Investors should refer to our Quarterly Report on Form 10-Q for the period ended September 30, 2018 once it is filed with the Securities and Exchange Commission.

(2)

This Financial Supplement includes non-GAAP measures. We believe these non-GAAP measures are useful to investors and users of our financial information as they provide an alternate measurement of our performance and assist in assessing our capital adequacy and the level of return generated. These non-GAAP measures should not be viewed as a substitute for reported results determined in accordance with generally accepted accounting principles in the U.S. ("GAAP"), nor are they necessarily comparable to non-GAAP measures that may be presented by other companies.

 

CAPITAL ONE FINANCIAL CORPORATION (COF)

Table 1: Financial Summary—Consolidated














2018 Q3 vs.


Nine Months Ended September 30,

(Dollars in millions, except per share data and as noted)


2018


2018


2018


2017


2017


2018


2017






2018 vs.


Q3


Q2


Q1


Q4


Q3


Q2


Q3


2018


2017


2017

Income Statement





















Net interest income


$

5,786



$

5,551



$

5,718



$

5,813



$

5,700



4

%


2

%


$

17,055



$

16,647



2

%

Non-interest income


1,176



1,641



1,191



1,200



1,285



(28)



(8)



4,008



3,577



12


Total net revenue(1)


6,962



7,192



6,909



7,013



6,985



(3)





21,063



20,224



4


Provision for credit losses


1,268



1,276



1,674



1,926



1,833



(1)



(31)



4,218



5,625



(25)


Non-interest expense:





















Marketing


504



425



414



460



379



19



33



1,343



1,210



11


Operating expenses


3,269



2,999



3,159



3,319



3,188



9



3



9,427



9,205



2


Total non-interest expense


3,773



3,424



3,573



3,779



3,567



10



6



10,770



10,415



3


Income from continuing operations before income taxes


1,921



2,492



1,662



1,308



1,585



(23)



21



6,075



4,184



45


Income tax provision


420



575



319



2,170



448



(27)



(6)



1,314



1,205



9


Income (loss) from continuing operations, net of tax


1,501



1,917



1,343



(862)



1,137



(22)



32



4,761



2,979



60


Income (loss) from discontinued operations, net of tax


1



(11)



3



(109)



(30)



**


**


(7)



(26)



(73)


Net income (loss)


1,502



1,906



1,346



(971)



1,107



(21)



36



4,754



2,953



61


Dividends and undistributed earnings allocated to participating securities(2)


(9)



(12)



(10)



(1)



(8)



(25)



13



(32)



(21)



52


Preferred stock dividends


(53)



(80)



(52)



(80)



(52)



(34)



2



(185)



(185)




Net income (loss) available to common stockholders


$

1,440



$

1,814



$

1,284



$

(1,052)



$

1,047



(21)



38



$

4,537



$

2,747



65


Common Share Statistics





















Basic earnings per common share:(2)





















Net income (loss) from continuing operations


$

3.01



$

3.76



$

2.63



$

(1.95)



$

2.22



(20)

%


36

%


$

9.40



$

5.73



64

%

Income (loss) from discontinued operations




(0.02)



0.01



(0.22)



(0.06)



**



**



(0.01)



(0.05)



(80)


Net income (loss) per basic common share


$

3.01



$

3.74



$

2.64



$

(2.17)



$

2.16



(20)



39



$

9.39



$

5.68



65


Diluted earnings per common share:(2)





















Net income (loss) from continuing operations


$

2.99



$

3.73



$

2.61



$

(1.95)



$

2.20



(20)



36



$

9.33



$

5.68



64


Income (loss) from discontinued operations




(0.02)



0.01



(0.22)



(0.06)



**



**



(0.01)



(0.05)



(80)


Net income (loss) per diluted common share


$

2.99



$

3.71



$

2.62



$

(2.17)



$

2.14



(19)



40



$

9.32



$

5.63



66


Weighted-average common shares outstanding (in millions):





















Basic


477.8



485.1



486.9



485.7



484.9



(2)



(1)



483.2



483.7




Diluted


480.9



488.3



490.8



485.7



489.0



(2)



(2)



486.7



488.1




Common shares outstanding (period-end, in millions)


473.7



478.4



485.9



485.5



484.4



(1)



(2)



473.7



484.4



(2)


Dividends declared and paid per common share


$

0.40



$

0.40



$

0.40



$

0.40



$

0.40







$

1.20



$

1.20




Tangible book value per common share (period-end)(3)


66.15



63.86



61.29



60.28



63.06



4



5



66.15



63.06



5













































2018 Q3 vs.


Nine Months Ended September 30,

(Dollars in millions)


2018


2018


2018


2017


2017


2018


2017






2018 vs.


Q3


Q2


Q1


Q4


Q3


Q2


Q3


2018


2017


2017

Balance Sheet (Period-End)





















Loans held for investment


$

238,761



$

236,124



$

248,256



$

254,473



$

252,422



1

%


(5)

%


$

238,761



$

252,422



(5)

%

Interest-earning assets


331,293



332,167



332,251



334,124



329,002





1



331,293



329,002



1


Total assets


362,909



363,989



362,857



365,693



361,402







362,909



361,402




Interest-bearing deposits


222,356



222,605



224,671



217,298



212,956





4



222,356



212,956



4


Total deposits


247,195



248,225



250,847



243,702



239,062





3



247,195



239,062



3


Borrowings


52,205



53,310



50,693



60,281



59,458



(2)



(12)



52,205



59,458



(12)


Common equity


46,277



45,566



44,842



44,370



45,794



2



1



46,277



45,794



1


Total stockholders' equity


50,638



49,926



49,203



48,730



50,154



1



1



50,638



50,154



1


Balance Sheet (Average Balances)





















Loans held for investment


$

236,766



$

240,758



$

249,726



$

252,566



$

245,822



(2)

%


(4)

%


$

242,369



$

243,205




Interest-earning assets


330,272



333,495



330,183



330,742



322,015



(1)



3



331,318



319,497



4

%

Total assets


360,937



363,929



362,049



363,045



355,191



(1)



2



362,293



352,216



3


Interest-bearing deposits


221,431



223,079



219,670



215,258



213,137



(1)



4



221,400



213,508



4


Total deposits


246,720



248,790



245,270



241,562



238,843



(1)



3



246,932



239,316



3


Borrowings


51,684



52,333



54,588



58,109



54,271



(1)



(5)



52,858



52,159



1


Common equity


46,407



45,466



44,670



46,350



45,816



2



1



45,521



44,772



2


Total stockholders' equity


50,768



49,827



49,031



50,710



50,176



2



1



49,882



49,132



2


 

 

CAPITAL ONE FINANCIAL CORPORATION (COF)

Table 2: Selected Metrics—Consolidated














2018 Q3 vs.


Nine Months Ended September 30,

(Dollars in millions, except as noted)


2018


2018


2018


2017


2017


2018


2017






2018 vs.


Q3


Q2


Q1


Q4


Q3


Q2


Q3


2018


2017


2017

Performance Metrics





















Net interest income growth (period over period)


4

%


(3)

%


(2)

%


2

%


4

%


**



**



2

%


8

%


**


Non-interest income growth (period over period)


(28)



38



(1)



(7)



4



**



**



12



2



**


Total net revenue growth (period over period)


(3)



4



(1)





4



**



**



4



7



**


Total net revenue margin(4)


8.43



8.63



8.37



8.48



8.68



(20)

bps


(25)

bps


8.48



8.44



4

bps

Net interest margin(5)


7.01



6.66



6.93



7.03



7.08



35



(7)



6.86



6.95



(9)


Return on average assets


1.66



2.11



1.48



(0.95)



1.28



(45)



38



1.75



1.13



62


Return on average tangible assets(6)


1.74



2.20



1.55



(0.99)



1.34



(46)



40



1.83



1.18



65


Return on average common equity(7)


12.40



16.06



11.47



(8.14)



9.40



(4)

%


3

%


13.31



8.26



5

%

Return on average tangible common equity(8)


18.32



23.99



17.32



(12.12)



14.11



(6)



4



19.88



12.56



7


Non-interest expense as a percentage of average loans held for investment


6.37



5.69



5.72



5.98



5.80



68

bps


57

bps


5.92



5.71



21

bps

Efficiency ratio(9)


54.19



47.61



51.72



53.89



51.07



7

%


3

%


51.13



51.50




Operating efficiency ratio(10)


46.95



41.70



45.72



47.33



45.64



5



1



44.76



45.52



(1)

%

Effective income tax rate for continuing operations


21.9



23.1



19.2



165.9



28.3



(1)



(6)



21.6



28.8



(7)


Employees (in thousands), period-end


47.6



47.8



47.9



49.3



50.4





(6)



47.6



50.4



(6)


Credit Quality Metrics





















Allowance for loan and lease losses


$

7,219



$

7,368



$

7,567



$

7,502



$

7,418



(2)

%


(3)

%


$

7,219



$

7,418



(3)

%

Allowance as a percentage of loans held for investment


3.02

%


3.12

%


3.05

%


2.95

%


2.94

%


(10)

bps


8

bps


3.02

%


2.94

%


8

bps

Net charge-offs


$

1,425



$

1,459



$

1,618



$

1,828



$

1,606



(2)

%


(11)

%


$

4,502



$

4,734



(5)

%

Net charge-off rate(11)


2.41

%


2.42

%


2.59

%


2.89

%


2.61

%


(1)

bps


(20)

bps


2.48

%


2.60

%


(12)

bps

30+ day performing delinquency rate


3.28



2.88



2.72



3.23



2.93



40



35



3.28



2.93



35


30+ day delinquency rate


3.48



3.05



2.91



3.48



3.24



43



24



3.48



3.24



24


Capital Ratios(12)





















Common equity Tier 1 capital


11.2

%


11.1

%


10.5

%


10.3

%


10.7

%


10

bps


50

bps


11.2

%


10.7

%


50

bps

Tier 1 capital


12.8



12.6



12.0



11.8



12.2



20



60



12.8



12.2



60


Total capital


15.2



15.1



14.5



14.4



14.8



10



40



15.2



14.8



40


Tier 1 leverage


10.6



10.3



10.1



9.9



10.5



30



10



10.6



10.5



10


Tangible common equity ("TCE")(13)


9.0



8.8



8.6



8.3



8.8



20



20



9.0



8.8



20



 

 

CAPITAL ONE FINANCIAL CORPORATION (COF)

Table 3: Consolidated Statements of Income














2018 Q3 vs.


Nine Months Ended September 30,



2018


2018


2018


2017


2017


2018


2017






2018 vs.

(Dollars in millions, except per share data and as noted)


Q3


Q2


Q1


Q4


Q3


Q2


Q3


2018


2017


2017

Interest income:





















Loans, including loans held for sale


$

6,247



$

5,989



$

6,134



$

6,133



$

5,960



4

%


5

%


$

18,370



$

17,255



6

%

Investment securities


593



539



452



431



431



10



38



1,584



1,280



24


Other


55



68



51



40



29



(19)



90



174



83



110


Total interest income


6,895



6,596



6,637



6,604



6,420



5



7



20,128



18,618



8


Interest expense:





















Deposits


681



622



539



457



410



9



66



1,842



1,145



61


Securitized debt obligations


127



124



107



91



85



2



49



358



236



52


Senior and subordinated notes


288



289



251



209



194





48



828



522



59


Other borrowings


13



10



22



34



31



30



(58)



45



68



(34)


Total interest expense


1,109



1,045



919



791



720



6



54



3,073



1,971



56


Net interest income


5,786



5,551



5,718



5,813



5,700



4



2



17,055



16,647



2


Provision for credit losses


1,268



1,276



1,674



1,926



1,833



(1)



(31)



4,218



5,625



(25)


Net interest income after provision for credit losses


4,518



4,275



4,044



3,887



3,867



6



17



12,837



11,022



16


Non-interest income:





















Interchange fees, net


714



723



643



665



662



(1)



8



2,080



1,908



9


Service charges and other customer-related fees


410



391



432



394



414



5



(1)



1,233



1,203



2


Net securities gains (losses)


(196)



(1)



8



1



68



**



**



(189)



64



**


Other


248



528



108



140



141



(53)



76



884



402



120


Total non-interest income


1,176



1,641



1,191



1,200



1,285



(28)



(8)



4,008



3,577



12


Non-interest expense:





















Salaries and associate benefits


1,432



1,430



1,520



1,521



1,524





(6)



4,382



4,378




Occupancy and equipment


515



503



490



523



471



2



9



1,508



1,416



6


Marketing


504



425



414



460



379



19



33



1,343



1,210



11


Professional services


275



234



210



274



297



18



(7)



719



823



(13)


Communications and data processing


311



317



306



306



294



(2)



6



934



871



7


Amortization of intangibles


44



43



44



61



61



2



(28)



131



184



(29)


Other


692



472



589



634



541



47



28



1,753



1,533



14


Total non-interest expense


3,773



3,424



3,573



3,779



3,567



10



6



10,770



10,415



3


Income from continuing operations before income taxes


1,921



2,492



1,662



1,308



1,585



(23)



21



6,075



4,184



45


Income tax provision


420



575



319



2,170



448



(27)



(6)



1,314



1,205



9


Income (loss) from continuing operations, net of tax


1,501



1,917



1,343



(862)



1,137



(22)



32



4,761



2,979



60


Income (loss) from discontinued operations, net of tax


1



(11)



3



(109)



(30)



**



**



(7)



(26)



(73)


Net income (loss)


1,502



1,906



1,346



(971)



1,107



(21)



36



4,754



2,953



61


Dividends and undistributed earnings allocated to participating securities(2)


(9)



(12)



(10)



(1)



(8)



(25)



13



(32)



(21)



52


Preferred stock dividends


(53)



(80)



(52)



(80)



(52)



(34)



2



(185)



(185)




Net income (loss) available to common stockholders


$

1,440



$

1,814



$

1,284



$

(1,052)



$

1,047



(21)



38



$

4,537



$

2,747



65



































2018 Q3 vs.


Nine Months Ended September 30,



2018


2018


2018


2017


2017


2018


2017






2018 vs.

(Dollars in millions, except per share data and as noted)


Q3


Q2


Q1


Q4


Q3


Q2


Q3


2018


2017


2017

Basic earnings per common share:(2)





















Net income (loss) from continuing operations


$

3.01



$

3.76



$

2.63



$

(1.95)



$

2.22



(20)

%


36

%


$

9.40



$

5.73



64

%

Income (loss) from discontinued operations




(0.02)



0.01



(0.22)



(0.06)



**



**



(0.01)



(0.05)



(80)


Net income (loss) per basic common share


$

3.01



$

3.74



$

2.64



$

(2.17)



$

2.16



(20)



39



$

9.39



$

5.68



65


Diluted earnings per common share:(2)





















Net income (loss) from continuing operations


$

2.99



$

3.73



$

2.61



$

(1.95)



$

2.20



(20)



36



$

9.33



$

5.68



64


Income (loss) from discontinued operations




(0.02)



0.01



(0.22)



(0.06)



**



**



(0.01)



(0.05)



(80)


Net income (loss) per diluted common share


$

2.99



$

3.71



$

2.62



$

(2.17)



$

2.14



(19)



40



$

9.32



$

5.63



66


Weighted-average common shares outstanding (in millions):





















Basic common shares


477.8



485.1



486.9



485.7



484.9



(2)



(1)



483.2



483.7




Diluted common shares


480.9



488.3



490.8



485.7



489.0



(2)



(2)



486.7



488.1




Dividends declared and paid per common share


$

0.40



$

0.40



$

0.40



$

0.40



$

0.40







$

1.20



$

1.20




 

CAPITAL ONE FINANCIAL CORPORATION (COF)

Table 4: Consolidated Balance Sheets














2018 Q3 vs.



2018


2018


2018


2017


2017


2018


2017

(Dollars in millions)


Q3


Q2


Q1


Q4


Q3


Q2


Q3

Assets:















Cash and cash equivalents:















Cash and due from banks


$

4,547



$

4,499



$

4,220



$

4,458



$

4,154



1

%


9

%

Interest-bearing deposits and other short-term investments


6,335



7,774



9,788



9,582



4,330



(19)



46


Total cash and cash equivalents


10,882



12,273



14,008



14,040



8,484



(11)



28


Restricted cash for securitization investors


746



1,023



309



312



304



(27)



145


Investment securities:















Securities available for sale


47,384



50,691



47,155



37,655



39,742



(7)



19


Securities held to maturity


34,631



33,464



23,075



28,984



28,650



3



21


Total investment securities


82,015



84,155



70,230



66,639



68,392



(3)



20


Loans held for investment:















Unsecuritized loans held for investment


204,796



201,222



213,313



218,806



217,659



2



(6)


Loans held in consolidated trusts


33,965



34,902



34,943



35,667



34,763



(3)



(2)


Total loans held for investment


238,761



236,124



248,256



254,473



252,422



1



(5)


Allowance for loan and lease losses


(7,219)



(7,368)



(7,567)



(7,502)



(7,418)



(2)



(3)


Net loans held for investment


231,542



228,756



240,689



246,971



245,004



1



(5)


Loans held for sale, at lower of cost or fair value


1,402



1,480



1,498



971



1,566



(5)



(10)


Premises and equipment, net


4,149



4,095



4,055



4,033



3,955



1



5


Interest receivable


1,518



1,493



1,496



1,536



1,426



2



6


Goodwill


14,513



14,531



14,536



14,533



14,532






Other assets


16,142



16,183



16,036



16,658



17,739





(9)


Total assets


$

362,909



$

363,989



$

362,857



$

365,693



$

361,402

































2018 Q3 vs.



2018


2018


2018


2017


2017


2018


2017

(Dollars in millions)


Q3


Q2


Q1


Q4


Q3


Q2


Q3

Liabilities:















Interest payable


$

391



$

450



$

353



$

413



$

301



(13)

%


30

%

Deposits:















Non-interest-bearing deposits


24,839



25,620



26,176



26,404



26,106



(3)



(5)


Interest-bearing deposits


222,356



222,605



224,671



217,298



212,956





4


Total deposits


247,195



248,225



250,847



243,702



239,062





3


Securitized debt obligations


18,649



19,649



18,665



20,010



17,087



(5)



9


Other debt:















Federal funds purchased and securities loaned or sold under agreements to repurchase


384



553



656



576



767



(31)



(50)


Senior and subordinated notes


31,291



32,920



31,051



30,755



28,420



(5)



10


Other borrowings


1,881



188



321



8,940



13,184



**



(86)


Total other debt


33,556



33,661



32,028



40,271



42,371





(21)


Other liabilities


12,480



12,078



11,761



12,567



12,427



3




Total liabilities


312,271



314,063



313,654



316,963



311,248



(1)



















Stockholders' equity:















Preferred stock


0



0



0



0



0






Common stock


7



7



7



7



7






Additional paid-in capital, net


31,978



31,868



31,779



31,656



31,526





1


Retained earnings


34,883



33,626



31,996



30,700



31,946



4



9


Accumulated other comprehensive loss


(1,877)



(1,793)



(1,599)



(926)



(622)



5



**


Treasury stock, at cost


(14,353)



(13,782)



(12,980)



(12,707)



(12,703)



4



13


Total stockholders' equity


50,638



49,926



49,203



48,730



50,154



1



1


Total liabilities and stockholders' equity


$

362,909



$

363,989



$

362,857



$

365,693



$

361,402






 


CAPITAL ONE FINANCIAL CORPORATION (COF)

Table 5: Notes to Financial Summary, Selected Metrics and Consolidated Financial Statements (Tables 1—4)



(1)

Total net revenue was reduced by $305 million in Q3 2018, $309 million in Q2 2018, $335 million in Q1 2018, $377 million in Q4 2017 and $356 million in Q3 2017 for the estimated uncollectible amount of billed finance charges and fees and related losses.

(2)

Dividends and undistributed earnings allocated to participating securities and earnings per share are computed independently for each period. Accordingly, the sum of each quarterly amount may not agree to the year-to-date total. We also provide adjusted diluted earnings per share, which is a non-GAAP measure. See "Table 15: Calculation of Regulatory Capital Measures and Reconciliation of Non-GAAP Measures" for additional information on our non-GAAP measures.

(3)

Tangible book value per common share is a non-GAAP measure calculated based on tangible common equity divided by common shares outstanding. See "Table 15: Calculation of Regulatory Capital Measures and Reconciliation of Non-GAAP Measures" for additional information on non-GAAP measures.

(4)

Total net revenue margin is calculated based on annualized total net revenue for the period divided by average interest-earning assets for the period.

(5)

Net interest margin is calculated based on annualized net interest income for the period divided by average interest-earning assets for the period.

(6)

Return on average tangible assets is a non-GAAP measure calculated based on annualized income from continuing operations, net of tax, for the period divided by average tangible assets for the period. See "Table 15: Calculation of Regulatory Capital Measures and Reconciliation of Non-GAAP Measures" for additional information on non-GAAP measures.

(7)

Return on average common equity is calculated based on annualized (i) income from continuing operations, net of tax; (ii) less dividends and undistributed earnings allocated to participating securities; (iii) less preferred stock dividends, for the period, divided by average common equity for the period. Our calculation of return on average common equity may not be comparable to similarly-titled measures reported by other companies.

(8)

Return on average tangible common equity ("ROTCE") is a non-GAAP measure calculated based on annualized (i) income from continuing operations, net of tax; (ii) less dividends and undistributed earnings allocated to participating securities; (iii) less preferred stock dividends, for the period, divided by average tangible common equity for the period. Our calculation of ROTCE may not be comparable to similarly-titled measures reported by other companies. See "Table 15: Calculation of Regulatory Capital Measures and Reconciliation of Non-GAAP Measures" for additional information on non-GAAP measures.

(9)

Efficiency ratio is calculated based on total non-interest expense for the period divided by total net revenue for the period. We also provide an adjusted efficiency ratio, which is a non-GAAP measure. See "Table 15: Calculation of Regulatory Capital Measures and Reconciliation of Non-GAAP Measures" for additional information on our non-GAAP measures.

(10)

Operating efficiency ratio is calculated based on operating expense for the period divided by total net revenue for the period. We also provide an adjusted operating efficiency ratio, which is a non-GAAP measure. See "Table 15: Calculation of Regulatory Capital Measures and Reconciliation of Non-GAAP Measures" for additional information on our non-GAAP measures.

(11)

Net charge-off rate is calculated based on annualized net charge-offs for the period divided by average loans held for investment for the period.

(12)

Capital ratios as of the end of Q3 2018 are preliminary and therefore subject to change. See "Table 15: Calculation of Regulatory Capital Measures and Reconciliation of Non-GAAP Measures" for information on the calculation of each of these ratios.

(13)

TCE ratio is a non-GAAP measure calculated based on TCE divided by tangible assets. See "Table 15: Calculation of Regulatory Capital Measures and Reconciliation of Non-GAAP Measures" for additional information on non-GAAP measures.

**

Not meaningful.

 

 

CAPITAL ONE FINANCIAL CORPORATION (COF)

Table 6: Average Balances, Net Interest Income and Net Interest Margin




2018 Q3


2018 Q2


2017 Q3



Average
Balance


Interest
Income/
Expense(1)


Yield/Rate(1)


Average
Balance


Interest
Income/
Expense(1)


Yield/Rate(1)


Average
Balance


Interest
Income/
Expense(1)


Yield/Rate(1)

(Dollars in millions, except as noted)










Interest-earning assets:



















Loans, including loans held for sale


$

238,150



$

6,247



10.49

%


$

242,043



$

5,989



9.90

%


$

247,022



$

5,960



9.65

%

Investment securities


83,894



593



2.83



79,829



539



2.70



69,302



431



2.49


Cash equivalents and other


8,228



55



2.66



11,623



68



2.34



5,691



29



2.04


Total interest-earning assets


$

330,272



$

6,895



8.35



$

333,495



$

6,596



7.91



$

322,015



$

6,420



7.97


Interest-bearing liabilities:



















Interest-bearing deposits


$

221,431



$

681



1.23



$

223,079



$

622



1.12



$

213,137



$

410



0.77


Securitized debt obligations


18,917



127



2.68



19,147



124



2.59



17,598



85



1.93


Senior and subordinated notes


31,660



288



3.63



32,250



289



3.58



28,753



194



2.70


Other borrowings and liabilities


3,084



13



1.67



4,132



10



0.97



9,320



31



1.33


Total interest-bearing liabilities


$

275,092



$

1,109



1.62



$

278,608



$

1,045



1.50



$

268,808



$

720



1.07


Net interest income/spread




$

5,786



6.73





$

5,551



6.41





$

5,700



6.90


Impact of non-interest-bearing funding






0.28







0.25







0.18


Net interest margin






7.01

%






6.66

%






7.08

%




Nine Months Ended September 30,



2018


2017



Average
Balance


Interest
Income/
Expense(1)


Yield/Rate(1)


Average
Balance


Interest
Income/
Expense(1)


Yield/Rate(1)

(Dollars in millions, except as noted)







Interest-earning assets:













Loans, including loans held for sale


$

243,653



$

18,370



10.05

%


$

244,097



$

17,255



9.43

%

Investment securities


77,819



1,584



2.71



68,862



1,280



2.48


Cash equivalents and other


9,846



174



2.36



6,538



83



1.69


Total interest-earning assets


$

331,318



$

20,128



8.10



$

319,497



$

18,618



7.77


Interest-bearing liabilities:













Interest-bearing deposits


$

221,400



$

1,842



1.11



$

213,508



$

1,145



0.72


Securitized debt obligations


19,251



358



2.46



17,726



236



1.78


Senior and subordinated notes


31,452



828



3.51



27,140



522



2.56


Other borrowings and liabilities


4,674



45



1.28



8,434



68



1.08


Total interest-bearing liabilities


$

276,777



$

3,073



1.49



$

266,808



$

1,971



0.98


Net interest income/spread




$

17,055



6.61





$

16,647



6.79


Impact of non-interest-bearing funding






0.25







0.16


Net interest margin






6.86

%






6.95

%


__________

(1)

Interest income and interest expense and the calculation of average yields on interest-earning assets and average rates on interest-bearing liabilities include the impact of hedge accounting. In the first quarter of 2018, we adopted Accounting Standard Update No. 2017-12, Derivatives and Hedging (Topic 815): Targeted Improvements to Accounting for Hedging Activities. As a result, interest income and interest expense amounts shown above include $2 million and $10 million for Q3 2018, and $1 million and $36 million for the nine months ended September 30, 2018, respectively, related to hedge ineffectiveness that was previously included in other non-interest income.


 

 

CAPITAL ONE FINANCIAL CORPORATION (COF)

Table 7: Loan Information and Performance Statistics














2018 Q3 vs.


Nine Months Ended September 30,

(Dollars in millions, except as noted)


2018
Q3


2018
Q2


2018
Q1


2017
Q4


2017
Q3


2018
Q2


2017
Q3


2018


2017


2018 vs.
2017

Loans Held for Investment (Period-End)





















Credit card:





















   Domestic credit card


$

101,564



$

100,714



$

98,535



$

105,293



$

99,981



1

%


2

%


$

101,564



$

99,981



2

%

   International card businesses


9,121



9,063



9,041



9,469



9,149



1





9,121



9,149




Total credit card


110,685



109,777



107,576



114,762



109,130



1



1



110,685



109,130



1


Consumer banking:





















   Auto


56,422



55,781



54,811



53,991



53,290



1



6



56,422



53,290



6


   Home loan(1)






16,630



17,633



18,820



**



**





18,820



**


   Retail banking


2,907



2,946



3,233



3,454



3,454



(1)



(16)



2,907



3,454



(16)


Total consumer banking


59,329



58,727



74,674



75,078



75,564



1



(21)



59,329



75,564



(21)


Commercial banking:





















   Commercial and multifamily real estate


29,064



28,292



27,360



26,150



27,944



3



4



29,064



27,944



4


   Commercial and industrial


39,325



38,948



38,208



38,025



39,306



1





39,325



39,306




   Total commercial lending


68,389



67,240



65,568



64,175



67,250



2



2



68,389



67,250



2


   Small-ticket commercial real estate


358



369



385



400



420



(3)



(15)



358



420



(15)


Total commercial banking


68,747



67,609



65,953



64,575



67,670



2



2



68,747



67,670



2


Other loans




11



53



58



58



**



**





58



**


Total loans held for investment


$

238,761



$

236,124



$

248,256



$

254,473



$

252,422



1



(5)



$

238,761



$

252,422



(5)


Loans Held for Investment (Average)





















Credit card:





















   Domestic credit card


$

100,566



$

98,895



$

100,450



$

101,087



$

93,729



2

%


7

%


$

99,970



$

92,847



8

%

   International card businesses


8,944



8,998



9,052



8,942



8,816



(1)



1



8,998



8,411



7


Total credit card


109,510



107,893



109,502



110,029



102,545



1



7



108,968



101,258



8


Consumer banking:





















   Auto


56,297



55,298



54,344



53,747



52,615



2



7



55,320



50,711



9


   Home loan(1)




8,098



17,224



18,109



19,302



**



**



8,377



20,211



(59)


   Retail banking


2,923



3,084



3,429



3,433



3,446



(5)



(15)



3,144



3,473



(9)


Total consumer banking


59,220



66,480



74,997



75,289



75,363



(11)



(21)



66,841



74,395



(10)


Commercial banking:





















   Commercial and multifamily real estate


28,354



27,302



26,542



27,770



27,703



4



2



27,406



27,235



1


   Commercial and industrial


39,318



38,686



38,246



39,020



39,723



2



(1)



38,754



39,804



(3)


   Total commercial lending


67,672



65,988



64,788



66,790



67,426



3





66,160



67,039



(1)


   Small-ticket commercial real estate


364



376



393



410



433



(3)



(16)



378



453



(17)


Total commercial banking


68,036



66,364



65,181



67,200



67,859



3





66,538



67,492



(1)


Other loans




21



46



48



55



**



**



22



60



(63)


Total average loans held for investment


$

236,766



$

240,758



$

249,726



$

252,566



$

245,822



(2)



(4)



$

242,369



$

243,205






















2018 Q3 vs.


Nine Months Ended September 30,

(Dollars in millions, except as noted)


2018
Q3


2018
Q2


2018
Q1


2017
Q4


2017
Q3


2018
Q2


2017
Q3


2018


2017


2018 vs.
2017

Net Charge-Off (Recovery) Rates




























Credit card:




























   Domestic credit card(2)



4.35

%



4.72

%



5.26

%



5.08

%



4.64

%


(37)

bps


(29)

bps



4.78

%



4.96

%


(18)

bps

   International card businesses



1.92




4.14




2.49




3.92




3.08



(222)



(116)




2.85




3.60



(75)


Total credit card(2)



4.15




4.67




5.03




4.99




4.51



(52)



(36)




4.62




4.85



(23)


Consumer banking:




























   Auto



1.73




1.32




1.53




2.12




1.96



41



(23)




1.53




1.77



(24)


   Home loan(1)









(0.03)




0.23




0.02



**



**




(0.02)




0.03



**


   Retail banking



2.62




2.07




1.89




1.94




2.10



55



52




2.18




1.91



27


Total consumer banking



1.77




1.19




1.19




1.66




1.47



58



30




1.36




1.30



6


Commercial banking:




























   Commercial and multifamily real estate



0.04










(0.01)




(0.01)



4



5




0.01




0.01




   Commercial and industrial



0.25




(0.07)




0.20




1.47




1.64



32



(139)




0.13




1.07



(94)


   Total commercial lending



0.16




(0.04)




0.12




0.86




0.97



20



(81)




0.08




0.64



(56)


   Small-ticket commercial real estate



0.56




(0.40)




(0.18)




(0.05)




0.12



96



44




(0.02)




0.33



(35)


Total commercial banking



0.16




(0.04)




0.11




0.85




0.96



20



(80)




0.08




0.64



(56)


Total net charge-offs



2.41




2.42




2.59




2.89




2.61



(1)



(20)




2.48




2.60



(12)


30+ Day Performing Delinquency Rates




























Credit card:




























   Domestic credit card



3.80

%



3.32

%



3.57

%



4.01

%



3.94

%


48

bps


(14)

bps



3.80

%



3.94

%


(14)

bps

   International card businesses



3.55




3.39




3.62




3.64




3.54



16



1




3.55




3.54



1


Total credit card



3.78




3.32




3.58




3.98




3.91



46



(13)




3.78




3.91



(13)


Consumer banking:




























   Auto



6.27




5.57




5.15




6.51




5.71



70



56




6.27




5.71



56


   Home loan(1)









0.20




0.20




0.17



**



**







0.17



**


   Retail banking



0.80




0.84




0.75




0.76




0.73



(4)



7




0.80




0.73



7


Total consumer banking



6.01




5.33




3.86




4.76




4.10



68



191




6.01




4.10



191


Nonperforming Loans and Nonperforming Assets Rates(3)(4)




























Credit card:




























   International card businesses



0.22

%



0.22

%



0.25

%



0.25

%



0.28

%




(6)

bps



0.22

%



0.28

%


(6)

bps

Total credit card



0.02




0.02




0.02




0.02




0.02








0.02




0.02




Consumer banking:




























   Auto



0.70




0.55




0.50




0.70




0.65



15

bps


5




0.70




0.65



5


   Home loan(1)









0.86




1.00




0.84



**



**







0.84



**


   Retail banking



1.13




1.15




1.04




1.00




0.97



(2)



16




1.13




0.97



16


Total consumer banking



0.72




0.58




0.61




0.78




0.71



14



1




0.72




0.71



1


Commercial banking:




























   Commercial and multifamily real estate



0.13




0.01




0.01




0.15




0.23



12



(10)




0.13




0.23



(10)


   Commercial and industrial



0.55




0.57




0.78




0.63




1.82



(2)



(127)




0.55




1.82



(127)


   Total commercial lending



0.37




0.33




0.46




0.43




1.16



4



(79)




0.37




1.16



(79)


   Small-ticket commercial real estate



1.65




1.18




1.46




1.65




1.59



47



6




1.65




1.59



6


Total commercial banking



0.38




0.34




0.47




0.44




1.16



4



(78)




0.38




1.16



(78)


Total nonperforming loans



0.30




0.25




0.32




0.35




0.54



5



(24)




0.30




0.54



(24)


Total nonperforming assets



0.33




0.30




0.35




0.41




0.60



3



(27)




0.33




0.60



(27)


 

 

CAPITAL ONE FINANCIAL CORPORATION (COF)

Table 8: Allowance for Loan and Lease Losses and Reserve for Unfunded Lending Commitments Activity




Three Months Ended September 30, 2018



Credit Card


Consumer Banking







(Dollars in millions)


Domestic
Card


International
Card
Businesses


Total
Credit
Card


Auto


Retail
Banking


Total
Consumer
Banking


Commercial
Banking


Other


Total

Allowance for loan and lease losses:



















Balance as of June 30, 2018


$

5,260



$

364



$

5,624



$

1,060



$

60



$

1,120



$

624





$

7,368


Charge-offs


(1,403)



(125)



(1,528)



(447)



(22)



(469)



(48)



$

1



(2,044)


Recoveries


309



82



391



204



3



207



21





619


Net charge-offs


(1,094)



(43)



(1,137)



(243)



(19)



(262)



(27)



1



(1,425)


Provision (benefit) for loan and lease losses


950



81



1,031



168



17



185



60



(1)



1,275


Allowance build (release) for loan and lease losses


(144)



38



(106)



(75)



(2)



(77)



33





(150)


Other changes(5)




2



2









(1)





1


Balance as of September 30, 2018


5,116



404



5,520



985



58



1,043



656





7,219


Reserve for unfunded lending commitments:



















Balance as of June 30, 2018










5



5



112





117


Benefit for losses on unfunded lending commitments










(1)



(1)



(6)





(7)


Balance as of September 30, 2018










4



4



106





110


Combined allowance and reserve as of September 30, 2018


$

5,116



$

404



$

5,520



$

985



$

62



$

1,047



$

762



$



$

7,329





Nine Months Ended September 30, 2018



Credit Card


Consumer Banking







(Dollars in millions)


Domestic
Card


International
Card
Businesses


Total
Credit
Card


Auto


Home
Loan(1)


Retail
Banking


Total
Consumer
Banking


Commercial
Banking


Other(1)


Total

Allowance for loan and lease losses:





















Balance as of December 31, 2017


$

5,273



$

375



$

5,648



$

1,119



$

58



$

65



$

1,242



$

611



$

1



$

7,502


Charge-offs


(4,649)



(383)



(5,032)



(1,250)





(64)



(1,314)



(76)



(7)



(6,429)


Recoveries


1,068



190



1,258



617



1



13



631



37



1



1,927


Net charge-offs


(3,581)



(193)



(3,774)



(633)



1



(51)



(683)



(39)



(6)



(4,502)


Provision (benefit) for loan and lease losses


3,424



234



3,658



499



(6)



45



538



85



(49)



4,232


Allowance build (release) for loan and lease losses


(157)



41



(116)



(134)



(5)



(6)



(145)



46



(55)



(270)


Other changes(1)(5)




(12)



(12)





(53)



(1)



(54)



(1)



54



(13)


Balance as of September 30, 2018


5,116



404



5,520



985





58



1,043



656





7,219


Reserve for unfunded lending commitments:





















Balance as of December 31, 2017












7



7



117





124


Benefit for losses on unfunded lending commitments












(3)



(3)



(11)





(14)


Balance as of September 30, 2018












4



4



106





110


Combined allowance and reserve as of September 30, 2018


$

5,116



$

404



$

5,520



$

985



$



$

62



$

1,047



$

762



$



$

7,329


 


 

 

CAPITAL ONE FINANCIAL CORPORATION (COF)

Table 9: Financial Summary—Business Segment Results




Three Months Ended September 30, 2018


Nine Months Ended September 30, 2018

(Dollars in millions)


Credit
Card


Consumer
Banking


Commercial
Banking(6)(7)


Other(6)(7)


Total


Credit
Card


Consumer
Banking


Commercial
Banking(6)(7)


Other(6)(7)


Total

Net interest income


$

3,596



$

1,636



$

539



$

15



$

5,786



$

10,550



$

4,860



$

1,624



$

21



$

17,055


Non-interest income


893



155



189



(61)



1,176



2,634



504



585



285



4,008


Total net revenue (loss)


4,489



1,791



728



(46)



6,962



13,184



5,364



2,209



306



21,063


Provision (benefit) for credit losses


1,031



184



54



(1)



1,268



3,658



535



74



(49)



4,218


Non-interest expense


2,103



979



408



283



3,773



6,046



2,942



1,220



562



10,770


Income (loss) from continuing operations before income taxes


1,355



628



266



(328)



1,921



3,480



1,887



915



(207)



6,075


Income tax provision (benefit)


315



146



62



(103)



420



810



440



213



(149)



1,314


Income (loss) from continuing operations, net of tax


$

1,040



$

482



$

204



$

(225)



$

1,501



$

2,670



$

1,447



$

702



$

(58)



$

4,761

























Three Months Ended June 30, 2018











(Dollars in millions)


Credit
Card


Consumer
Banking


Commercial
Banking(6)(7)


Other(6)(7)


Total











Net interest income


$

3,396



$

1,609



$

549



$

(3)



$

5,551












Non-interest income


884



175



209



373



1,641












Total net revenue


4,280



1,784



758



370



7,192












Provision (benefit) for credit losses


1,171



118



34



(47)



1,276












Non-interest expense


1,904



963



409



148



3,424












Income from continuing operations before income taxes


1,205



703



315



269



2,492












Income tax provision


282



164



73



56



575












Income from continuing operations, net of tax


$

923



$

539



$

242



$

213



$

1,917



































Three Months Ended September 30, 2017


Nine Months Ended September 30, 2017

(Dollars in millions)


Credit
Card


Consumer
Banking


Commercial
Banking(6)


Other(6)


Total


Credit
Card


Consumer
Banking


Commercial
Banking(6)


Other(6)


Total

Net interest income


$

3,440



$

1,649



$

560



$

51



$

5,700



$

10,080



$

4,744



$

1,695



$

128



$

16,647


Non-interest income


865



192



179



49



1,285



2,478



570



520



9



3,577


Total net revenue


4,305



1,841



739



100



6,985



12,558



5,314



2,215



137



20,224


Provision for credit losses


1,466



293



63



11



1,833



4,580



840



201



4



5,625


Non-interest expense


1,961



1,051



394



161



3,567



5,808



3,152



1,166



289



10,415


Income (loss) from continuing operations before income taxes


878



497



282



(72)



1,585



2,170



1,322



848



(156)



4,184


Income tax provision (benefit)


306



181



103



(142)



448



774



482



310



(361)



1,205


Income from continuing operations, net of tax


$

572



$

316



$

179



$

70



$

1,137



$

1,396



$

840



$

538



$

205



$

2,979























 

 

CAPITAL ONE FINANCIAL CORPORATION (COF)

Table 10: Financial & Statistical Summary—Credit Card Business














2018 Q3 vs.


Nine Months Ended September 30,



2018


2018


2018


2017


2017


2018


2017






2018 vs.

(Dollars in millions, except as noted)


Q3


Q2


Q1


Q4


Q3


Q2


Q3


2018


2017


2017

Credit Card





















Earnings:





















Net interest income


$

3,596



$

3,396



$

3,558



$

3,568



$

3,440



6

%


5

%


$

10,550



$

10,080



5

%

Non-interest income


893



884



857



847



865



1



3



2,634



2,478



6


Total net revenue


4,489



4,280



4,415



4,415



4,305



5



4



13,184



12,558



5


Provision for credit losses


1,031



1,171



1,456



1,486



1,466



(12)



(30)



3,658



4,580



(20)


Non-interest expense


2,103



1,904



2,039



2,108



1,961



10



7



6,046



5,808



4


Income from continuing operations before income taxes


1,355



1,205



920



821



878



12



54



3,480



2,170



60


Income tax provision


315



282



213



297



306



12



3



810



774



5


Income from continuing operations, net of tax


$

1,040



$

923



$

707



$

524



$

572



13



82



$

2,670



$

1,396



91


Selected performance metrics:





















Period-end loans held for investment


$

110,685



$

109,777



$

107,576



$

114,762



$

109,130



1



1



$

110,685



$

109,130



1


Average loans held for investment


109,510



107,893



109,502



110,029



102,545



1



7



108,968



101,258



8


Average yield on loans held for investment(8)


15.79

%


15.06

%


15.24

%


15.13

%


15.58

%


73

bps


21

bps


15.37

%


15.24

%


13

bps

Total net revenue margin(9)


16.40



15.87



16.13



16.05



16.79



53



(39)



16.13



16.54



(41)


Net charge-off rate(2)


4.15



4.67



5.03



4.99



4.51



(52)



(36)



4.62



4.85



(23)


30+ day performing delinquency rate


3.78



3.32



3.58



3.98



3.91



46



(13)



3.78



3.91



(13)


30+ day delinquency rate


3.80



3.33



3.59



3.99



3.92



47



(12)



3.80



3.92



(12)


Nonperforming loan rate(3)


0.02



0.02



0.02



0.02



0.02







0.02



0.02




Purchase volume(10)


$

97,469



$

97,392



$

86,545



$

95,659



$

84,505





15

%


$

281,406



$

240,781



17

%


































2018 Q3 vs.


Nine Months Ended September 30,



2018


2018


2018


2017


2017


2018


2017






2018 vs.

(Dollars in millions, except as noted)


Q3


Q2


Q1


Q4


Q3


Q2


Q3


2018


2017


2017

Domestic Card





















Earnings:





















Net interest income


$

3,280



$

3,108



$

3,229



$

3,268



$

3,132



6

%


5

%


$

9,617



$

9,236



4

%

Non-interest income


819



818



774



781



787





4



2,411



2,288



5


Total net revenue


4,099



3,926



4,003



4,049



3,919



4



5



12,028



11,524



4


Provision for credit losses


950



1,094



1,380



1,402



1,417



(13)



(33)



3,424



4,381



(22)


Non-interest expense


1,890



1,683



1,832



1,880



1,754



12



8



5,405



5,198



4


Income from continuing operations before income taxes


1,259



1,149



791



767



748



10



68



3,199



1,945



64


Income tax provision


293



268



184



280



273



9



7



745



710



5


Income from continuing operations, net of tax


$

966



$

881



$

607



$

487



$

475



10



103



$

2,454



$

1,235



99


Selected performance metrics:





















Period-end loans held for investment


$

101,564



$

100,714



$

98,535



$

105,293



$

99,981



1



2



$

101,564



$

99,981



2


Average loans held for investment


100,566



98,895



100,450



101,087



93,729



2



7



99,970



92,847



8


Average yield on loans held for investment(8)


15.73

%


15.05

%


15.10

%


15.08

%


15.51

%


68

bps


22

bps


15.29

%


15.20

%


9

bps

Total net revenue margin(9)


16.30



15.88



15.94



16.03



16.72



42



(42)



16.04



16.55



(51)


Net charge-off rate(2)


4.35



4.72



5.26



5.08



4.64



(37)



(29)



4.78



4.96



(18)


30+ day delinquency rate


3.80



3.32



3.57



4.01



3.94



48



(14)



3.80



3.94



(14)


Purchase volume(10)


$

89,205



$

88,941



$

79,194



$

87,287



$

76,806





16

%


$

257,340



$

219,537



17

%

Refreshed FICO scores:(11)





















Greater than 660


67

%


68

%


66

%


66

%


65

%


(1)

%


2



67

%


65

%


2


660 or below


33



32



34



34



35



1



(2)



33



35



(2)


Total


100

%


100

%


100

%


100

%


100

%






100

%


100

%



 


CAPITAL ONE FINANCIAL CORPORATION (COF)

Table 11: Financial & Statistical Summary—Consumer Banking Business














2018 Q3 vs.


Nine Months Ended September 30,



2018


2018


2018


2017


2017


2018


2017






2018 vs.

(Dollars in millions, except as noted)


Q3


Q2


Q1


Q4


Q3


Q2


Q3


2018


2017


2017

Consumer Banking





















Earnings:





















Net interest income


$

1,636



$

1,609



$

1,615



$

1,636



$

1,649



2

%


(1)

%


$

4,860



$

4,744



2

%

Non-interest income


155



175



174



179



192



(11)



(19)



504



570



(12)


Total net revenue


1,791



1,784



1,789



1,815



1,841





(3)



5,364



5,314



1


Provision for credit losses


184



118



233



340



293



56



(37)



535



840



(36)


Non-interest expense


979



963



1,000



1,081



1,051



2



(7)



2,942



3,152



(7)


Income from continuing operations before income taxes


628



703



556



394



497



(11)



26



1,887



1,322



43


Income tax provision


146



164



130



144



181



(11)



(19)



440



482



(9)


Income from continuing operations, net of tax


$

482



$

539



$

426



$

250



$

316



(11)



53



$

1,447



$

840



72


Selected performance metrics:





















Period-end loans held for investment(1)


$

59,329



$

58,727



$

74,674



$

75,078



$

75,564



1



(21)



$

59,329



$

75,564



(21)


Average loans held for investment(1)


59,220



66,480



74,997



75,289



75,363



(11)



(21)



66,841



74,395



(10)


Average yield on loans held for investment(8)


8.03

%


7.32

%


6.86

%


6.84

%


6.79

%


71

bps


124

bps


7.36

%


6.61

%


75

bps

Auto loan originations


$

6,643



$

6,994



$

6,707



$

6,215



$

7,043



(5)

%


(6)

%


$

20,345



$

21,521



(5)

%

Period-end deposits


196,635



194,962



193,073



185,842



184,719



1



6



196,635



184,719



6


Average deposits


194,687



193,278



187,785



184,799



185,072



1



5



191,942



185,336



4


Average deposits interest rate


1.00

%


0.88

%


0.80

%


0.69

%


0.62

%


12

bps


38

bps


0.89

%


0.60

%


29

bps

Net charge-off rate


1.77



1.19



1.19



1.66



1.47



58



30



1.36



1.30



6


30+ day performing delinquency rate


6.01



5.33



3.86



4.76



4.10



68



191



6.01



4.10



191


30+ day delinquency rate


6.61



5.80



4.27



5.34



4.61



81



200



6.61



4.61



200


Nonperforming loan rate(3)


0.72



0.58



0.61



0.78



0.71



14



1



0.72



0.71



1


Nonperforming asset rate(4)


0.82



0.73



0.70



0.91



0.88



9



(6)



0.82



0.88



(6)


Auto—At origination FICO scores:(12)





















Greater than 660


50

%


50

%


51

%


51

%


51

%




(1)

%


50

%


51

%


(1)

%

621-660


19



19



18



18



18





1



19



18



1


620 or below


31



31



31



31



31







31



31




Total


100

%


100

%


100

%


100

%


100

%






100

%


100

%




 

 

CAPITAL ONE FINANCIAL CORPORATION (COF)

Table 12: Financial & Statistical Summary—Commercial Banking Business














2018 Q3 vs.


Nine Months Ended September 30,



2018


2018


2018


2017


2017


2018


2017






2018 vs.

(Dollars in millions, except as noted)


Q3


Q2


Q1


Q4


Q3


Q2


Q3


2018


2017


2017

Commercial Banking





















Earnings:





















Net interest income


$

539



$

549



$

536



$

566



$

560



(2)

%


(4)

%


$

1,624



$

1,695



(4)

%

Non-interest income


189



209



187



188



179



(10)



6



585



520



13


Total net revenue(6)(7)


728



758



723



754



739



(4)



(1)



2,209



2,215




Provision (benefit) for credit losses


54



34



(14)



100



63



59



(14)



74



201



(63)


Non-interest expense


408



409



403



437



394





4



1,220



1,166



5


Income from continuing operations before income taxes


266



315



334



217



282



(16)



(6)



915



848



8


Income tax provision


62



73



78



79



103



(15)



(40)



213



310



(31)


Income from continuing operations, net of tax


$

204



$

242



$

256



$

138



$

179



(16)



14



$

702



$

538



30


Selected performance metrics:





















Period-end loans held for investment


$

68,747



$

67,609



$

65,953



$

64,575



$

67,670



2



2



$

68,747



$

67,670



2


Average loans held for investment


68,036



66,364



65,181



67,200



67,859



3





66,538



67,492



(1)


Average yield on loans held for investment(6)(8)


4.55

%


4.43

%


4.16

%


4.03

%


3.98

%


12

bps


57

bps


4.38

%


3.81

%


57

bps

Period-end deposits


$

30,474



$

31,078



$

34,449



$

33,938



$

32,783



(2)

%


(7)

%


$

30,474



$

32,783



(7)

%

Average deposits


31,061



32,951



34,057



34,117



33,197



(6)



(6)



32,679



33,890



(4)


Average deposits interest rate


0.79

%


0.65

%


0.52

%


0.46

%


0.42

%


14

bps


37

bps


0.65

%


0.37

%


28

bps

Net charge-off (recovery) rate


0.16



(0.04)



0.11



0.85



0.96



20



(80)



0.08



0.64



(56)


Nonperforming loan rate(3)


0.38



0.34



0.47



0.44



1.16



4



(78)



0.38



1.16



(78)


Nonperforming asset rate(4)


0.41



0.37



0.49



0.52



1.22



4



(81)



0.41



1.22



(81)


Risk category:(13)





















Noncriticized


$

65,926



$

64,923



$

62,773



$

61,162



$

63,501



2

%


4

%


$

65,926



$

63,501



4

%

Criticized performing


2,204



2,088



2,432



2,649



2,878



6



(23)



2,204



2,878



(23)


Criticized nonperforming


259



229



309



284



788



13



(67)



259



788



(67)


PCI loans


358



369



439



480



503



(3)



(29)



358



503



(29)


Total commercial loans


$

68,747



$

67,609



$

65,953



$

64,575



$

67,670



2



2



$

68,747



$

67,670



2


Risk category as a percentage of period-end loans held for investment:(13)
























Noncriticized


95.9

%


96.1

%


95.1

%


94.7

%


93.8

%


(20)

bps


210

bps


95.9

%


93.8

%


210

bps

Criticized performing


3.2



3.1



3.7



4.1



4.3



10



(110)



3.2



4.3



(110)


Criticized nonperforming


0.4



0.3



0.5



0.4



1.2



10



(80)



0.4



1.2



(80)


PCI loans


0.5



0.5



0.7



0.8



0.7





(20)



0.5



0.7



(20)


Total commercial loans


100.0

%


100.0

%


100.0

%


100.0

%


100.0

%






100.0

%


100.0

%



 

 

CAPITAL ONE FINANCIAL CORPORATION (COF)

Table 13: Financial & Statistical Summary—Other and Total














2018 Q3 vs.


Nine Months Ended September 30,



2018


2018


2018


2017


2017


2018


2017






2018 vs.

(Dollars in millions)


Q3


Q2


Q1


Q4


Q3


Q2


Q3


2018


2017


2017