Capital One Reports Second Quarter 2020 Net Loss of $918 million, or $2.21 per share

Excluding adjusting items, Second Quarter 2020 Net Loss of $1.61 per share(1)

MCLEAN, Va., July 21, 2020 /PRNewswire/ -- Capital One Financial Corporation (NYSE: COF) today announced net loss for the second quarter of 2020 of $918 million, or $2.21 per diluted common share, compared with net loss of $1.3 billion, or $3.10 per diluted common share in the first quarter of 2020, and with net income of $1.6 billion, or $3.24 per diluted common share in the second quarter of 2019. Excluding adjusting items, net loss for the second quarter of 2020 was $1.61 per diluted common share(1).

"Our investments to transform our technology and how we work, and our efforts to drive the company to digital are powering our response to the pandemic," said Richard D. Fairbank, Founder, Chairman and Chief Executive Officer. "We remain well positioned to weather the downturn, emerge with strength, and deliver shareholder value over the long-term."

Adjusting items in the second quarter of 2020, which are excluded from diluted earnings per share (EPS), efficiency ratio and operating 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

Legal reserve builds

$

265

$

0.58

Cybersecurity Incident expenses, net of insurance

11

0.02

All comparisons below are for the second quarter of 2020 compared with the first quarter of 2020 unless otherwise noted.

Second Quarter 2020 Income Statement Summary:

  • Total net revenue decreased 10 percent to $6.6 billion.
  • Total non-interest expense increased 1 percent to $3.8 billion:
    • 44 percent decrease in marketing.
    • 8 percent increase in operating expenses.
  • Pre-provision earnings decreased 21 percent to $2.8 billion(2).
  • Provision for credit losses decreased 22 percent to $4.2 billion:
    • Net charge-offs of $1.5 billion.
    • $2.7 billion reserve build.
  • Net interest margin of 5.78 percent, decreased 100 basis points.
  • Efficiency ratio of 57.50 percent.
    • Efficiency ratio excluding adjusting items of 53.29 percent(1).
  • Operating efficiency ratio of 53.34 percent.
    • Operating efficiency ratio excluding adjusting items of 49.13 percent(1).

Second Quarter 2020 Balance Sheet Summary:

  • Common equity Tier 1 capital ratio under Basel III Standardized Approach of 12.4 percent at June 30, 2020.
  • Period-end loans held for investment in the quarter decreased $11.5 billion, or 4 percent, to $251.5 billion.
    • Credit Card period-end loans decreased $10.5 billion, or 9 percent, to $107.3 billion.
      • Domestic Card period-end loans decreased $10.2 billion, or 9 percent, to $99.4 billion.
    • Consumer Banking period-end loans increased $2.7 billion, or 4 percent, to $66.7 billion
      • Auto period-end loans increased $2.0 billion, or 3 percent, to $63.3 billion.
    • Commercial Banking period-end loans decreased $3.7 billion, or 5 percent, to $77.5 billion.
  • Average loans held for investment in the quarter decreased $9.5 billion, or 4 percent, to $253.4 billion.
    • Credit Card average loans decreased $14.0 billion, or 11 percent, to $108.7 billion
      • Domestic Card average loans decreased $12.7 billion, or 11 percent, to $101.0 billion.
    • Consumer Banking average loans increased $1.2 billion, or 2 percent, to $64.9 billion.
      • Auto average loans increased $793 million, or 1 percent, to $61.8 billion.
    • Commercial Banking average loans increased $3.3 billion, or 4 percent, to $79.8 billion.
  • Period-end total deposits increased $34.5 billion, or 13 percent, to $304.2 billion, while average deposits increased $23.7 billion, or 9 percent, to $288.3 billion.
  • Interest-bearing deposits rate paid decreased 27 basis points to 0.94 percent.

(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, both in the current period and across periods. 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.

Earnings Conference Call Webcast Information

The company will hold an earnings conference call on July 21, 2020 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). Under "About," 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 August 4, 2020 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, 2019.

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 $304.2 billion in deposits and $421.3 billion in total assets as of  June 30, 2020. 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.

 

Exhibit 99.2

Capital One Financial Corporation

Financial Supplement(1)(2)

Second Quarter 2020

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 Credit Losses and Reserve for Unfunded Lending Commitments Activity

12

Business Segment Results

Table 9:

Financial Summary—Business Segment Results

14

Table 10:

Financial & Statistical Summary—Credit Card Business

15

Table 11:

Financial & Statistical Summary—Consumer Banking Business

17

Table 12:

Financial & Statistical Summary—Commercial Banking Business

18

Table 13:

Financial & Statistical Summary—Other and Total

19

Other

Table 14:

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

20

Table 15:

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

21

__________

(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 June 30, 2020 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













2020 Q2 vs.

Six Months Ended June 30,

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

2020

2020

2019

2019

2019

2020

2019




2020 vs.

Q2

Q1

Q4

Q3

Q2

Q1

Q2

2020

2019

2019

Income Statement



















Net interest income

$

5,460

$

6,025

$

6,066

$

5,737

$

5,746

(9)

%

(5)

%

$

11,485

$

11,537

—

Non-interest income

1,096

1,224

1,361

1,222

1,378

(10)

(20)

2,320

2,670

(13)

%

Total net revenue(1)

6,556

7,249

7,427

6,959

7,124

(10)

(8)

13,805

14,207

(3)

Provision for credit losses

4,246

5,423

1,818

1,383

1,342

(22)

**

9,669

3,035

**

Non-interest expense:



















Marketing

273

491

710

501

546

(44)

(50)

764

1,063

(28)

Operating expense

3,497

3,238

3,451

3,371

3,233

8

8

6,735

6,387

5

Total non-interest expense

3,770

3,729

4,161

3,872

3,779

1

—

7,499

7,450

1

Income (loss) from continuing operations before income taxes

(1,460)

(1,903)

1,448

1,704

2,003

(23)

**

(3,363)

3,722

**

Income tax provision (benefit)

(543)

(563)

270

375

387

(4)

**

(1,106)

696

**

Income (loss) from continuing operations, net of tax

(917)

(1,340)

1,178

1,329

1,616

(32)

**

(2,257)

3,026

**

Income (loss) from discontinued operations, net of tax

(1)

—

(2)

4

9

**

**

(1)

11

**

Net income (loss)

(918)

(1,340)

1,176

1,333

1,625

(31)

**

(2,258)

3,037

**

Dividends and undistributed earnings allocated to participating securities(2)

(1)

(3)

(7)

(10)

(12)

(67)

(92)

(4)

(24)

(83)

Preferred stock dividends

(90)

(55)

(97)

(53)

(80)

64

13

(145)

(132)

10

Issuance cost for redeemed preferred stock(3)

—

(22)

(31)

—

—

**

—

(22)

—

**

Net income (loss) available to common stockholders

$

(1,009)

$

(1,420)

$

1,041

$

1,270

$

1,533

(29)

**

$

(2,429)

$

2,881

**

Common Share Statistics



















Basic earnings per common share:(2)



















Net income (loss) from continuing operations

$

(2.21)

$

(3.10)

$

2.26

$

2.70

$

3.24

(29)

%

**

$

(5.31)

$

6.11

**

Income from discontinued operations

—

—

—

0.01

0.02

—

**

—

0.02

**

Net income (loss) per basic common share

$

(2.21)

$

(3.10)

$

2.26

$

2.71

$

3.26

(29)

**

$

(5.31)

$

6.13

**

Diluted earnings per common share:(2)



















Net income (loss) from continuing operations

$

(2.21)

$

(3.10)

$

2.25

$

2.68

$

3.22

(29)

**

$

(5.31)

$

6.08

**

Income from discontinued operations

—

—

—

0.01

0.02

—

**

—

0.02

**

Net income (loss) per diluted common share

$

(2.21)

$

(3.10)

$

2.25

$

2.69

$

3.24

(29)

**

$

(5.31)

$

6.10

**

Weighted-average common shares outstanding (in millions):



















Basic

456.7

457.6

460.9

469.5

470.8

—

(3)

%

457.1

470.1

(3)

%

Diluted

456.7

457.6

463.4

471.8

473.0

—

(3)

457.1

472.3

(3)

Common shares outstanding (period-end, in millions)

456.3

455.3

456.6

465.7

470.3

—

(3)

456.3

470.3

(3)

Dividends declared and paid per common share

$

0.40

$

0.40

$

0.40

$

0.40

$

0.40

—

—

$

0.80

$

0.80

—

Tangible book value per common share (period-end)(4)

78.82

80.68

83.72

80.46

77.65

(2)

2

78.82

77.65

2










































































2020 Q2 vs.

Six Months Ended June 30,

(Dollars in millions)

2020

2020

2019

2019

2019

2020

2019




2020 vs.

Q2

Q1

Q4

Q3

Q2

Q1

Q2

2020

2019

2019

Balance Sheet (Period-End)



















Loans held for investment

$

251,512

$

262,990

$

265,809

$

249,355

$

244,460

(4)

%

3

%

$

251,512

$

244,460

3

%

Interest-earning assets

389,829

364,472

355,202

344,643

339,160

7

15

389,829

339,160

15

Total assets

421,296

396,878

390,365

378,810

373,619

6

13

421,296

373,619

13

Interest-bearing deposits

275,183

245,142

239,209

234,084

231,161

12

19

275,183

231,161

19

Total deposits

304,238

269,689

262,697

257,148

254,535

13

20

304,238

254,535

20

Borrowings

44,900

55,681

55,697

50,149

49,233

(19)

(9)

44,900

49,233

(9)

Common equity

50,835

51,620

53,157

52,412

51,406

(2)

(1)

50,835

51,406

(1)

Total stockholders' equity

56,045

56,830

58,011

58,235

55,767

(1)

—

56,045

55,767

—

Balance Sheet (Average Balances)



















Loans held for investment

$

253,358

$

262,889

$

258,870

$

246,147

$

242,653

(4)

%

4

%

$

258,124

$

242,307

7

%

Interest-earning assets

378,145

355,347

349,150

340,949

338,026

6

12

366,746

337,913

9

Total assets

411,075

390,380

383,162

374,905

371,095

5

11

400,845

370,746

8

Interest-bearing deposits

261,256

241,115

236,250

232,063

230,452

8

13

251,185

229,020

10

Total deposits

288,344

264,653

260,040

255,082

253,634

9

14

276,498

252,528

9

Borrowings

49,827

51,795

51,442

49,413

49,982

(4)

—

50,810

51,510

(1)

Common equity

52,413

53,186

52,641

52,566

50,209

(1)

4

52,799

49,289

7

Total stockholders' equity

57,623

58,568

58,148

57,245

54,570

(2)

6

58,096

53,650

8

               

 

CAPITAL ONE FINANCIAL CORPORATION (COF)

Table 2: Selected Metrics—Consolidated













2020 Q2 vs.

Six Months Ended June 30,

(Dollars in millions, except as noted)

2020

2020

2019

2019

2019

2020

2019




2020 vs.

Q2

Q1

Q4

Q3

Q2

Q1

Q2

2020

2019

2019

Performance Metrics



















Net interest income growth (period over period)

(9)

%

(1)

%

6

%

—

(1)

%

**

**

—

2

%

**

Non-interest income growth (period over period)

(10)

(10)

11

(11)

%

7

**

**

(13)

%

(6)

**

Total net revenue growth (period over period)

(10)

(2)

7

(2)

1

**

**

(3)

1

**

Total net revenue margin(5)

6.93

8.16

8.51

8.16

8.43

(123)

bps

(150)

bps

7.53

8.41

(88)

bps

Net interest margin(6)

5.78

6.78

6.95

6.73

6.80

(100)

(102)

6.26

6.83

(57)

Return on average assets

(0.89)

(1.37)

1.23

1.42

1.74

48

**

(1.13)

1.63

**

Return on average tangible assets(7)

(0.93)

(1.43)

1.28

1.48

1.82

50

**

(1.17)

1.70

**

Return on average common equity(8)

(7.69)

(10.68)

7.93

9.63

12.14

299

**

(9.20)

11.65

**

Return on average tangible common equity(9)

(10.74)

(14.85)

11.07

13.45

17.26

4

%

**

(12.81)

16.70

**

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

5.95

5.67

6.43

6.29

6.23

28

bps

(28)

5.81

6.15

(34)

Efficiency ratio(10)

57.50

51.44

56.03

55.64

53.05

6

%

4

%

54.32

52.44

2

%

Operating efficiency ratio(11)

53.34

44.67

46.47

48.44

45.38

9

8

48.79

44.96

4

Effective income tax rate for continuing operations

37.2

29.6

18.6

22.0

19.3

8

18

32.9

18.7

14

Employees (period-end, in thousands)

53.1

52.1

51.9

52.1

50.7

2

5

53.1

50.7

5

Credit Quality Metrics



















Allowance for credit losses

$

16,832

$

14,073

$

7,208

$

7,037

$

7,133

20

%

136

%

$

16,832

$

7,133

136

%

Allowance coverage ratio

6.69

%

5.35

%

2.71

%

2.82

%

2.92

%

134

bps

377

bps

6.69

%

2.92

%

377

bps

Net charge-offs

$

1,505

$

1,791

$

1,683

$

1,462

$

1,508

(16)

%

—

$

3,296

$

3,107

6

%

Net charge-off rate(12)

2.38

%

2.72

%

2.60

%

2.38

%

2.48

%

(34)

bps

(10)

bps

2.55

%

2.56

%

(1)

bps

30+ day performing delinquency rate(13)

2.09

2.95

3.51

3.28

3.15

(86)

(106)

2.09

3.15

(106)

30+ day delinquency rate(13)

2.30

3.16

3.74

3.51

3.35

(86)

(105)

2.30

3.35

(105)

Capital Ratios(14)



















Common equity Tier 1 capital

12.4

%

12.0

%

12.2

%

12.5

%

12.3

%

40

bps

10

bps

12.4

%

12.3

%

10

bps

Tier 1 capital

14.2

13.7

13.7

14.4

13.8

50

40

14.2

13.8

40

Total capital

16.7

16.1

16.1

16.8

16.2

60

50

16.7

16.2

50

Tier 1 leverage

10.3

11.0

11.7

11.9

11.4

(70)

(110)

10.3

11.4

(110)

Tangible common equity ("TCE")(15)

8.8

9.6

10.2

10.3

10.2

(80)

(140)

8.8

10.2

(140)

 

 

CAPITAL ONE FINANCIAL CORPORATION (COF)

Table 3: Consolidated Statements of Income













2020 Q2 vs.

Six Months Ended June 30,


2020

2020

2019

2019

2019

2020

2019




2020 vs.

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

Q2

Q1

Q4

Q3

Q2

Q1

Q2

2020

2019

2019

Interest income:



















Loans, including loans held for sale

$

5,820

$

6,542

$

6,682

$

6,429

$

6,383

(11)

%

(9)

%

$

12,362

$

12,751

(3)

%

Investment securities

482

530

544

583

629

(9)

(23)

1,012

1,284

(21)

Other

16

37

44

63

64

(57)

(75)

53

133

(60)

Total interest income

6,318

7,109

7,270

7,075

7,076

(11)

(11)

13,427

14,168

(5)

Interest expense:



















Deposits

611

731

832

901

870

(16)

(30)

1,342

1,687

(20)

Securitized debt obligations

56

99

118

123

139

(43)

(60)

155

282

(45)

Senior and subordinated notes

180

239

236

299

310

(25)

(42)

419

624

(33)

Other borrowings

11

15

18

15

11

(27)

—

26

38

(32)

Total interest expense

858

1,084

1,204

1,338

1,330

(21)

(35)

1,942

2,631

(26)

Net interest income

5,460

6,025

6,066

5,737

5,746

(9)

(5)

11,485

11,537

—

Provision for credit losses

4,246

5,423

1,818

1,383

1,342

(22)

**

9,669

3,035

**

Net interest income after provision for credit losses

1,214

602

4,248

4,354

4,404

102

(72)

1,816

8,502

(79)

Non-interest income:



















Interchange fees, net

672

752

811

790

820

(11)

(18)

1,424

1,578

(10)

Service charges and other customer-related fees

258

327

342

283

352

(21)

(27)

585

705

(17)

Net securities gains (losses)

—

—

(18)

5

15

—

**

—

39

**

Other

166

145

226

144

191

14

(13)

311

348

(11)

Total non-interest income

1,096

1,224

1,361

1,222

1,378

(10)

(20)

2,320

2,670

(13)

Non-interest expense:



















Salaries and associate benefits

1,704

1,627

1,652

1,605

1,558

5

9

3,331

3,131

6

Occupancy and equipment

523

517

565

519

521

1

—

1,040

1,014

3

Marketing

273

491

710

501

546

(44)

(50)

764

1,063

(28)

Professional services

304

287

318

314

314

6

(3)

591

605

(2)

Communications and data processing

308

302

346

312

329

2

(6)

610

632

(3)

Amortization of intangibles

16

22

28

25

29

(27)

(45)

38

59

(36)

Other(16)

642

483

542

596

482

33

33

1,125

946

19

Total non-interest expense

3,770

3,729

4,161

3,872

3,779

1

—

7,499

7,450

1

Income (loss) from continuing operations before income taxes

(1,460)

(1,903)

1,448

1,704

2,003

(23)

**

(3,363)

3,722

**

Income tax provision (benefit)

(543)

(563)

270

375

387

(4)

**

(1,106)

696

**

Income (loss) from continuing operations, net of tax

(917)

(1,340)

1,178

1,329

1,616

(32)

**

(2,257)

3,026

**

Income (loss) from discontinued operations, net of tax

(1)

—

(2)

4

9

**

**

(1)

11

**

Net income (loss)

(918)

(1,340)

1,176

1,333

1,625

(31)

**

(2,258)

3,037

**

Dividends and undistributed earnings allocated to participating securities(2)

(1)

(3)

(7)

(10)

(12)

(67)

(92)

(4)

(24)

(83)

Preferred stock dividends

(90)

(55)

(97)

(53)

(80)

64

13

(145)

(132)

10

Issuance cost for redeemed preferred stock(3)

—

(22)

(31)

—

—

**

—

(22)

—

**

Net income (loss) available to common stockholders

$

(1,009)

$

(1,420)

$

1,041

$

1,270

$

1,533

(29)

**

$

(2,429)

$

2,881

**






















































2020 Q2 vs.

Six Months Ended June 30,


2020

2020

2019

2019

2019

2020

2019




2020 vs.

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

Q2

Q1

Q4

Q3

Q2

Q1

Q2

2020

2019

2019

Basic earnings per common share:(2)



















Net income (loss) from continuing operations

$

(2.21)

$

(3.10)

$

2.26

$

2.70

$

3.24

(29)

%

**

$

(5.31)

$

6.11

**

Income from discontinued operations

—

—

—

0.01

0.02

—

**

—

0.02

**

Net income (loss) per basic common share

$

(2.21)

$

(3.10)

$

2.26

$

2.71

$

3.26

(29)

**

$

(5.31)

$

6.13

**

Diluted earnings per common share:(2)



















Net income (loss) from continuing operations

$

(2.21)

$

(3.10)

$

2.25

$

2.68

$

3.22

(29)

**

$

(5.31)

$

6.08

**

Income from discontinued operations

—

—

—

0.01

0.02

—

**

—

0.02

**

Net income (loss) per diluted common share

$

(2.21)

$

(3.10)

$

2.25

$

2.69

$

3.24

(29)

**

$

(5.31)

$

6.10

**

Weighted-average common shares outstanding (in millions):



















Basic common shares

456.7

457.6

460.9

469.5

470.8

—

(3)

%

457.1

470.1

(3)

%

Diluted common shares

456.7

457.6

463.4

471.8

473.0

—

(3)

457.1

472.3

(3)

 


 

CAPITAL ONE FINANCIAL CORPORATION (COF)

Table 4: Consolidated Balance Sheets













2020 Q2 vs.


2020

2020

2019

2019

2019

2020

2019

(Dollars in millions)

Q2

Q1

Q4

Q3

Q2

Q1

Q2

Assets:













Cash and cash equivalents:













Cash and due from banks

$

4,583

$

4,545

$

4,129

$

4,452

$

5,184

1

%

(12)

%

Interest-bearing deposits and other short-term investments

51,235

20,391

9,278

12,668

9,927

151

416

Total cash and cash equivalents

55,818

24,936

13,407

17,120

15,111

124

269

Restricted cash for securitization investors

740

364

342

417

710

103

4

Investment securities:













Securities available for sale

87,859

81,423

79,213

46,168

45,658

8

92

Securities held to maturity

—

—

—

33,894

35,475

—

**

Total investment securities

87,859

81,423

79,213

80,062

81,133

8

8

Loans held for investment:













Unsecuritized loans held for investment

222,310

231,318

231,992

215,892

211,556

(4)

5

Loans held in consolidated trusts

29,202

31,672

33,817

33,463

32,904

(8)

(11)

Total loans held for investment

251,512

262,990

265,809

249,355

244,460

(4)

3

Allowance for credit losses

(16,832)

(14,073)

(7,208)

(7,037)

(7,133)

20

136

Net loans held for investment

234,680

248,917

258,601

242,318

237,327

(6)

(1)

Loans held for sale

711

1,056

400

1,245

1,829

(33)

(61)

Premises and equipment, net

4,324

4,336

4,378

4,311

4,243

—

2

Interest receivable

1,574

1,687

1,758

1,627

1,544

(7)

2

Goodwill

14,645

14,645

14,653

14,624

14,545

—

1

Other assets

20,945

19,514

17,613

17,086

17,177

7

22

Total assets

$

421,296

$

396,878

$

390,365

$

378,810

$

373,619

6

13



























2020 Q2 vs.


2020

2020

2019

2019

2019

2020

2019

(Dollars in millions)

Q2

Q1

Q4

Q3

Q2

Q1

Q2

Liabilities:













Interest payable

$

380

$

359

$

439

$

370

$

437

6

%

(13)

%

Deposits:













Non-interest-bearing deposits

29,055

24,547

23,488

23,064

23,374

18

24

Interest-bearing deposits

275,183

245,142

239,209

234,084

231,161

12

19

Total deposits

304,238

269,689

262,697

257,148

254,535

13

20

Securitized debt obligations

15,761

17,141

17,808

18,910

16,959

(8)

(7)

Other debt:













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

573

399

314

464

359

44

60

Senior and subordinated notes

28,481

32,049

30,472

30,682

31,822

(11)

(10)

Other borrowings

85

6,092

7,103

93

93

(99)

(9)

Total other debt

29,139

38,540

37,889

31,239

32,274

(24)

(10)

Other liabilities

15,733

14,319

13,521

12,908

13,647

10

15

Total liabilities

365,251

340,048

332,354

320,575

317,852

7

15















Stockholders' equity:













Preferred stock

0

0

0

0

0

—

—

Common stock

7

7

7

7

7

—

—

Additional paid-in capital, net

33,556

33,450

32,980

33,826

32,262

—

4

Retained earnings

35,361

36,552

40,340

39,476

38,386

(3)

(8)

Accumulated other comprehensive income

3,981

3,679

1,156

453

170

8

**

Treasury stock, at cost

(16,860)

(16,858)

(16,472)

(15,527)

(15,058)

—

12

Total stockholders' equity

56,045

56,830

58,011

58,235

55,767

(1)

—

Total liabilities and stockholders' equity

$

421,296

$

396,878

$

390,365

$

378,810

$

373,619

6

13

 


 

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 $318 million in Q2 2020 and $389 million in Q1 2020 for credit card finance charges and fees charged-off as uncollectible,

and by $365 million in Q4 2019, $330 million in Q3 2019 and $318 million in Q2 2019 for the estimated uncollectible amount of credit card 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)

On March 2, 2020, we redeemed all outstanding shares of our fixed rate 6.00% non-cumulative perpetual preferred stock Series B. The redemption increased

our net loss available to common shareholders by $22 million in Q1 2020. On December 2, 2019, we redeemed all outstanding shares of our fixed rate 6.25%

non-cumulative perpetual preferred stock Series C and fixed rate 6.70% non-cumulative perpetual preferred stock Series D. The redemption reduced our net

income available to common shareholders by $31 million in Q4 2019.

(4)

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.

(5)

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

(6)

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

(7)

Return on average tangible assets is a non-GAAP measure calculated based on annualized income (loss) 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.

(8)

Return on average common equity is calculated based on net income (loss) available to common stockholders less income (loss) from discontinued operations,

net of tax, for the period, divided by average common equity. Our calculation of return on average common equity may not be comparable to similarly-titled

measures reported by other companies.

(9)

Return on average tangible common equity ("ROTCE") is a non-GAAP measure calculated based on net income (loss) available to common stockholders less

income (loss) from discontinued operations, net of tax, for the period, divided by average tangible common equity ("TCE"). Our calculation of return on average

TCE 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.

(10)

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.

(11)

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.

(12)

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.

(13)

Metrics for Q2 2020 and Q1 2020 include the impact of COVID-19 customer assistance programs where applicable.

(14)

Capital ratios as of the end of Q2 2020 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.

(15)

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.

(16)

Includes net Cybersecurity Incident expenses of $11 million in Q2 2020, $4 million in Q1 2020, $16 million in Q4 2019 and $22 million in Q3 2019, respectively.

**

Not meaningful.

 

 

CAPITAL ONE FINANCIAL CORPORATION (COF)

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



2020 Q2

2020 Q1

2019 Q2


Average
Balance

Interest
Income/
Expense

Yield/Rate

Average
Balance

Interest
Income/
Expense

Yield/Rate

Average
Balance

Interest
Income/
Expense

Yield/Rate

(Dollars in millions, except as noted)








Interest-earning assets:

















Loans, including loans held for sale

$

254,402

$

5,820

9.15

%

$

263,631

$

6,542

9.93

%

$

243,831

$

6,383

10.47

%

Investment securities

81,095

482

2.38

78,212

530

2.71

82,383

629

3.05

Cash equivalents and other

42,648

16

0.15

13,504

37

1.10

11,812

64

2.16

Total interest-earning assets

$

378,145

$

6,318

6.68

$

355,347

$

7,109

8.00

$

338,026

$

7,076

8.37

Interest-bearing liabilities:

















Interest-bearing deposits

$

261,256

$

611

0.94

$

241,115

$

731

1.21

$

230,452

$

870

1.51

Securitized debt obligations

16,432

56

1.37

18,054

99

2.20

18,262

139

3.04

Senior and subordinated notes

31,294

180

2.30

31,342

239

3.04

30,630

310

4.05

Other borrowings and liabilities

3,554

11

1.21

3,779

15

1.62

2,322

11

1.91

Total interest-bearing liabilities

$

312,536

$

858

1.10

$

294,290

$

1,084

1.47

$

281,666

$

1,330

1.89

Net interest income/spread


$

5,460

5.58



$

6,025

6.53



$

5,746

6.48

Impact of non-interest-bearing funding




0.20





0.25





0.32

Net interest margin




5.78

%




6.78

%




6.80

%




Six Months Ended June 30,


2020

2019


Average
Balance

Interest
Income/
Expense

Yield/Rate

Average
Balance

Interest
Income/
Expense

Yield/Rate

(Dollars in millions, except as noted)





Interest-earning assets:











Loans, including loans held for sale

$

259,017

$

12,362

9.55

%

$

243,383

$

12,751

10.48

%

Investment securities

79,654

1,012

2.54

83,027

1,284

3.09

Cash equivalents and other

28,075

53

0.38

11,503

133

2.31

Total interest-earning assets

$

366,746

$

13,427

7.32

$

337,913

$

14,168

8.39

Interest-bearing liabilities:











Interest-bearing deposits

$

251,185

$

1,342

1.07

$

229,020

$

1,687

1.47

Securitized debt obligations

17,243

155

1.80

18,503

282

3.05

Senior and subordinated notes

31,318

419

2.67

30,732

624

4.06

Other borrowings and liabilities

3,667

26

1.42

3,497

38

2.20

Total interest-bearing liabilities

$

303,413

$

1,942

1.28

$

281,752

$

2,631

1.87

Net interest income/spread


$

11,485

6.04



$

11,537

6.52

Impact of non-interest-bearing funding




0.22





0.31

Net interest margin




6.26

%




6.83

%

 

 

CAPITAL ONE FINANCIAL CORPORATION (COF)

Table 7: Loan Information and Performance Statistics













2020 Q2 vs.

Six Months Ended June 30,


2020

2020

2019

2019

2019

2020

2019

2020

2019

2020 vs.
2019

(Dollars in millions, except as noted)

Q2

Q1

Q4

Q3

Q2

Q1

Q2

Loans Held for Investment (Period-End)



















Credit card:



















   Domestic credit card

$

99,390

$

109,549

$

118,606

$

104,664

$

102,959

(9)

%

(3)

%

$

99,390

$

102,959

(3)

%

   International card businesses

7,920

8,248

9,630

9,017

9,182

(4)

(14)

7,920

9,182

(14)

Total credit card(1)

107,310

117,797

128,236

113,681

112,141

(9)

(4)

107,310

112,141

(4)

Consumer banking:



















   Auto

63,319

61,364

60,362

59,278

57,556

3

10

63,319

57,556

10

   Retail banking

3,393

2,669

2,703

2,737

2,771

27

22

3,393

2,771

22

Total consumer banking

66,712

64,033

63,065

62,015

60,327

4

11

66,712

60,327

11

Commercial banking:



















   Commercial and multifamily real estate

30,953

32,373

30,245

30,009

29,861

(4)

4

30,953

29,861

4

   Commercial and industrial

46,537

48,787

44,263

43,650

42,125

(5)

10

46,537

42,125

10

  Total commercial lending

77,490

81,160

74,508

73,659

71,986

(5)

8

77,490

71,986

8

   Small-ticket commercial real estate

—

—

—

—

6

**

**

—

6

**

Total commercial banking

77,490

81,160

74,508

73,659

71,992

(5)

8

77,490

71,992

8

Total loans held for investment

$

251,512

$

262,990

$

265,809

$

249,355

$

244,460

(4)

3

$

251,512

$

244,460

3

Loans Held for Investment (Average)



















Credit card:



















   Domestic credit card

$

100,996

$

113,711

$

112,965

$

103,426

$

101,930

(11)

%

(1)

%

$

107,354

$

102,296

5

%

   International card businesses

7,752

9,065

9,120

8,945

8,868

(14)

(13)

8,408

8,829

(5)

Total credit card(1)

108,748

122,776

122,085

112,371

110,798

(11)

(2)

115,762

111,125

4

Consumer banking:



















   Auto

61,798

61,005

59,884

58,517

57,070

1

8

61,401

56,654

8

   Retail banking

3,053

2,666

2,712

2,752

2,788

15

10

2,860

2,809

2

Total consumer banking

64,851

63,671

62,596

61,269

59,858

2

8

64,261

59,463

8

Commercial banking:



















   Commercial and multifamily real estate

31,723

31,081

30,173

29,698

29,514

2

7

31,402

29,276

7

   Commercial and industrial

48,036

45,361

44,016

42,807

42,476

6

13

46,699

42,304

10

  Total commercial lending

79,759

76,442

74,189

72,505

71,990

4

11

78,101

71,580

9

   Small-ticket commercial real estate

—

—

—

2

7

**

**

—

139

**

Total commercial banking

79,759

76,442

74,189

72,507

71,997

4

11

78,101

71,719

9

Total average loans held for investment

$

253,358

$

262,889

$

258,870

$

246,147

$

242,653

(4)

4

$

258,124

$

242,307

7



















2020 Q2 vs.

Six Months Ended June 30,


2020

2020

2019

2019

2019

2020

2019

2020

2019

2020 vs.
2019


Q2

Q1

Q4

Q3

Q2

Q1

Q2

Net Charge-Off Rates


























Credit card:


























   Domestic credit card

4.53

%

4.68

%

4.32

%

4.12

%

4.86

%

(15)

bps

(33)

bps

4.61

%

4.95

%

(34)

bps

   International card businesses

3.47


4.65


4.22


3.78


3.63

(118)

(16)


4.11


3.41

70

Total credit card

4.46


4.68


4.31


4.09


4.76

(22)

(30)


4.57


4.83

(26)

Consumer banking:


























   Auto

1.16


1.51


1.90


1.60


1.09

(35)

7


1.33


1.26

7

   Retail banking

1.78


2.37


2.77


2.55


2.42

(59)

(64)


2.05


2.49

(44)

Total consumer banking

1.19


1.54


1.93


1.64


1.15

(35)

4


1.36


1.32

4

Commercial banking:


























   Commercial and multifamily real estate

0.09


—


—


0.02


—

9

9


0.04


—

4

   Commercial and industrial

0.78


0.96


0.60


0.55


0.15

(18)

63


0.87


0.14

73

Total commercial banking

0.51


0.57


0.35


0.33


0.09

(6)

42


0.54


0.08

46

Total net charge-offs

2.38


2.72


2.60


2.38


2.48

(34)

(10)


2.55


2.56

(1)

30+ Day Performing Delinquency Rates(2)


























Credit card:


























   Domestic credit card

2.74

%

3.69

%

3.93

%

3.71

%

3.40

%

(95)

bps

(66)

bps

2.74

%

3.40

%

(66)

bps

   International card businesses

2.71


3.66


3.47


3.52


3.40

(95)

(69)


2.71


3.40

(69)

Total credit card

2.74


3.69


3.89


3.69


3.40

(95)

(66)


2.74


3.40

(66)

Consumer banking:


























   Auto

3.28


5.29


6.88


6.47


6.10

(201)

(282)


3.28


6.10

(282)

   Retail banking

0.89


1.27


1.02


1.01


0.93

(38)

(4)


0.89


0.93

(4)

Total consumer banking

3.16


5.12


6.63


6.23


5.87

(196)

(271)


3.16


5.87

(271)

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


























Credit card:


























   International card businesses

0.29

%

0.29

%

0.26

%

0.25

%

0.25

%

—

4

bps

0.29

%

0.25

%

4

bps

Total credit card

0.02


0.02


0.02


0.02


0.02

—

—


0.02


0.02

—

Consumer banking:


























   Auto

0.41


0.62


0.81


0.73


0.64

(21)

bps

(23)


0.41


0.64

(23)

   Retail banking

0.70


0.88


0.87


0.91


1.02

(18)

(32)


0.70


1.02

(32)

Total consumer banking

0.43


0.63


0.81


0.74


0.66

(20)

(23)


0.43


0.66

(23)

Commercial banking:


























   Commercial and multifamily real estate

0.54


0.22


0.12


0.12


0.14

32

40


0.54


0.14

40

   Commercial and industrial

1.06


0.87


0.93


0.95


0.74

19

32


1.06


0.74

32

Total commercial banking

0.85


0.61


0.60


0.61


0.50

24

35


0.85


0.50

35

Total nonperforming loans

0.38


0.35


0.37


0.37


0.32

3

6


0.38


0.32

6

Total nonperforming assets

0.39


0.37


0.39


0.40


0.34

2

5


0.39


0.34

5

 

 

CAPITAL ONE FINANCIAL CORPORATION (COF)

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



Three Months Ended June 30, 2020


Credit Card

Consumer Banking



(Dollars in millions)

Domestic
Card

International
Card
Businesses

Total
Credit
Card

Auto

Retail
Banking

Total
Consumer
Banking

Commercial
Banking

Total

Allowance for credit losses:















Balance as of March 31, 2020

$

9,806

$

540

$

10,346

$

2,058

$

96

$

2,154

$

1,573

$

14,073

Charge-offs

(1,493)

(119)

(1,612)

(399)

(17)

(416)

(103)

(2,131)

Recoveries

350

51

401

220

4

224

1

626

Net charge-offs

(1,143)

(68)

(1,211)

(179)

(13)

(192)

(102)

(1,505)

Provision for credit losses

2,906

38

2,944

847

29

876

432

4,252

Allowance build (release) for credit losses

1,763

(30)

1,733

668

16

684

330

2,747

Other changes(5)

—

12

12

—

—

—

—

12

Balance as of June 30, 2020

11,569

522

12,091

2,726

112

2,838

1,903

16,832

Reserve for unfunded lending commitments:















Balance as of March 31, 2020

—

—

—

—

—

—

223

223

Benefit for losses on unfunded lending commitments

—

—

—

—

—

—

(5)

(5)

Balance as of June 30, 2020

—

—

—

—

—

—

218

218

Combined allowance and reserve as of June 30, 2020

$

11,569

$

522

$

12,091

$

2,726

$

112

$

2,838

$

2,121

$

17,050




Six Months Ended June 30, 2020


Credit Card

Consumer Banking



(Dollars in millions)

Domestic
Card

International
Card
Businesses

Total
Credit
Card

Auto

Retail
Banking

Total
Consumer
Banking

Commercial
Banking

Total

Allowance for credit losses:















Balance as of December 31, 2019

$

4,997

$

398

$

5,395

$

984

$

54

$

1,038

$

775

$

7,208

Cumulative effects from adoption of the current expected credit loss ("CECL") standard

2,237

4

2,241

477

25

502

102

2,845

Finance charge and fee reserve reclassification(1)

439

23

462

—

—

—

—

462

Balance as of January 1, 2020

7,673

425

8,098

1,461

79

1,540

877

10,515

Charge-offs

(3,208)

(253)

(3,461)

(875)

(37)

(912)

(215)

(4,588)

Recoveries

734

80

814

466

8

474

4

1,292

Net charge-offs

(2,474)

(173)

(2,647)

(409)

(29)

(438)

(211)

(3,296)

Provision for credit losses

6,370

276

6,646

1,674

62

1,736

1,237

9,619

Allowance build for credit losses

3,896

103

3,999

1,265

33

1,298

1,026

6,323

Other changes(5)

—

(6)

(6)

—

—

—

—

(6)

Balance as of June 30, 2020

11,569

522

12,091

2,726

112

2,838

1,903

16,832

Reserve for unfunded lending commitments:















Balance as of December 31, 2019

—

—

—

—

5

5

130

135

Cumulative effects from adoption of the CECL standard

—

—

—

—

(5)

(5)

42

37

Balance as of January 1, 2020

—

—

—

—

—

—

172

172

Provision for losses on unfunded lending commitments

—

—

—

—

—

—

46

46

Balance as of June 30, 2020

—

—

—

—

—

—

218

218

Combined allowance and reserve as of June 30, 2020

$

11,569

$

522

$

12,091

$

2,726

$

112

$

2,838

$

2,121

$

17,050

 

 


CAPITAL ONE FINANCIAL CORPORATION (COF)

Table 9: Financial Summary—Business Segment Results



Three Months Ended June 30, 2020

Six Months Ended June 30, 2020

(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 (loss)

$

3,369

$

1,665

$

518

$

(92)

$

5,460

$

7,071

$

3,322

$

1,009

$

83

$

11,485

Non-interest income (loss)

845

97

180

(26)

1,096

1,756

223

418

(77)

2,320

Total net revenue (loss)

4,214

1,762

698

(118)

6,556

8,827

3,545

1,427

6

13,805

Provision (benefit) for credit losses

2,944

876

427

(1)

4,246

6,646

1,736

1,283

4

9,669

Non-interest expense

1,969

1,036

425

340

3,770

4,177

2,027

837

458

7,499

Loss from continuing operations before income taxes

(699)

(150)

(154)

(457)

(1,460)

(1,996)

(218)

(693)

(456)

(3,363)

Income tax benefit

(166)

(36)

(36)

(305)

(543)

(472)

(52)

(164)

(418)

(1,106)

Loss from continuing operations, net of tax

$

(533)

$

(114)

$

(118)

$

(152)

$

(917)

$

(1,524)

$

(166)

$

(529)

$

(38)

$

(2,257)























Three Months Ended March 31, 2020









(Dollars in millions)

Credit
Card

Consumer
Banking

Commercial
Banking(6)

Other(6)

Total









Net interest income

$

3,702

$

1,657

$

491

$

175

$

6,025










Non-interest income (loss)

911

126

238

(51)

1,224










Total net revenue

4,613

1,783

729

124

7,249










Provision for credit losses

3,702

860

856

5

5,423










Non-interest expense

2,208

991

412

118

3,729










Income (loss) from continuing operations before income taxes

(1,297)

(68)

(539)

1

(1,903)










Income tax benefit

(306)

(16)

(128)

(113)

(563)










Income (loss) from continuing operations, net of tax

$

(991)

$

(52)

$

(411)

$

114

$

(1,340)

































Three Months Ended June 30, 2019

Six Months Ended June 30, 2019

(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 (loss)

$

3,531

$

1,709

$

514

$

(8)

$

5,746

$

7,121

$

3,388

$

1,003

$

25

$

11,537

Non-interest income (loss)

1,038

166

200

(26)

1,378

1,988

326

387

(31)

2,670

Total net revenue (loss)

4,569

1,875

714

(34)

7,124

9,109

3,714

1,390

(6)

14,207

Provision for credit losses

1,095

165

82

—

1,342

2,484

400

151

—

3,035

Non-interest expense

2,253

1,002

427

97

3,779

4,424

1,996

844

186

7,450

Income (loss) from continuing operations before income taxes

1,221

708

205

(131)

2,003

2,201

1,318

395

(192)

3,722

Income tax provision (benefit)

283

165

48

(109)

387

512

307

92

(215)

696

Income (loss) from continuing operations, net of tax

$

938

$

543

$

157

$

(22)

$

1,616

$

1,689

$

1,011

$

303

$

23

$

3,026





















 

 


CAPITAL ONE FINANCIAL CORPORATION (COF)

Table 10: Financial & Statistical Summary—Credit Card Business













2020 Q2 vs.

Six Months Ended June 30,


2020

2020

2019

2019

2019

2020

2019




2020 vs.

(Dollars in millions, except as noted)

Q2

Q1

Q4

Q3

Q2

Q1

Q2

2020

2019

2019

Credit Card



















Earnings:



















Net interest income

$

3,369

$

3,702

$

3,794

$

3,546

$

3,531

(9)

%

(5)

%

$

7,071

$

7,121

(1)

%

Non-interest income

845

911

1,030

870

1,038

(7)

(19)

1,756

1,988

(12)

Total net revenue

4,214

4,613

4,824

4,416

4,569

(9)

(8)

8,827

9,109

(3)

Provision for credit losses

2,944

3,702

1,421

1,087

1,095

(20)

169

6,646

2,484

168

Non-interest expense

1,969

2,208

2,487

2,360

2,253

(11)

(13)

4,177

4,424

(6)

Income (loss) from continuing operations before income taxes

(699)

(1,297)

916

969

1,221

(46)

**

(1,996)

2,201

**

Income tax provision (benefit)

(166)

(306)

212

235

283

(46)

**

(472)

512

**

Income (loss) from continuing operations, net of tax

$

(533)

$

(991)

$

704

$

734

$

938

(46)

**

$

(1,524)

$

1,689

**

Selected performance metrics:



















Period-end loans held for investment(1)

$

107,310

$

117,797

$

128,236

$

113,681

$

112,141

(9)

(4)

$

107,310

$

112,141

(4)

Average loans held for investment(1)

108,748

122,776

122,085

112,371

110,798

(11)

(2)

115,762

111,125

4

Average yield on loans held for investment(7)

13.72

%

14.46

%

15.02

%

15.55

%

15.66

%

(74)

bps

(194)

bps

14.11

%

15.72

%

(161)

bps

Total net revenue margin(8)

15.50

15.03

15.80

15.72

16.50

47

(100)

15.25

16.39

(114)

Net charge-off rate

4.46

4.68

4.31

4.09

4.76

(22)

(30)

4.57

4.83

(26)

30+ day performing delinquency rate

2.74

3.69

3.89

3.69

3.40

(95)

(66)

2.74

3.40

(66)

30+ day delinquency rate

2.75

3.70

3.91

3.71

3.42

(95)

(67)

2.75

3.42

(67)

Nonperforming loan rate(3)

0.02

0.02

0.02

0.02

0.02

—

—

0.02

0.02

—

Purchase volume(9)

$

90,149

$

99,920

$

116,631

$

108,034

$

106,903

(10)

%

(16)

%

$

190,069

$

200,100

(5)

%


















































2020 Q2 vs.

Six Months Ended June 30,


2020

2020

2019

2019

2019

2020

2019




2020 vs.

(Dollars in millions, except as noted)

Q2

Q1

Q4

Q3

Q2

Q1

Q2

2020

2019

2019

Domestic Card



















Earnings:



















Net interest income

$

3,094

$

3,381

$

3,473

$

3,299

$

3,220

(8)

%

(4)

%

$

6,475

$

6,493

—

Non-interest income

795

842

962

878

971

(6)

(18)

1,637

1,844

(11)

%

Total net revenue

3,889

4,223

4,435

4,177

4,191

(8)

(7)

8,112

8,337

(3)

Provision for credit losses

2,906

3,464

1,346

1,010

1,024

(16)

184

6,370

2,315

175

Non-interest expense

1,776

1,984

2,249

2,076

2,034

(10)

(13)

3,760

3,983

(6)

Income (loss) from continuing operations before income taxes

(793)

(1,225)

840

1,091

1,133

(35)

**

(2,018)

2,039

**

Income tax provision (benefit)

(188)

(290)

196

254

264

(35)

**

(478)

475

**

Income (loss) from continuing operations, net of tax

$

(605)

$

(935)

$

644

$

837

$

869

(35)

**

$

(1,540)

$

1,564

**

Selected performance metrics:



















Period-end loans held for investment(1)

$

99,390

$

109,549

$

118,606

$

104,664

$

102,959

(9)

(3)

$

99,390

$

102,959

(3)

Average loans held for investment(1)

100,996

113,711

112,965

103,426

101,930

(11)

(1)

107,354

102,296

5

Average yield on loans held for investment(7)

13.52

%

14.30

%

14.91

%

15.74

%

15.60

%

(78)

bps

(208)

bps

13.93

%

15.65

%

(172)

bps

Total net revenue margin(8)

15.40

14.86

15.70

16.15

16.45

54

(105)

15.11

16.30

(119)

Net charge-off rate

4.53

4.68

4.32

4.12

4.86

(15)

(33)

4.61

4.95

(34)

30+ day performing delinquency rate

2.74

3.69

3.93

3.71

3.40

(95)

(66)

2.74

3.40

(66)

Purchase volume(9)

$

82,860

$

92,248

$

107,154

$

99,087

$

98,052

(10)

%

(15)

%

$

175,108

$

183,790

(5)

%

Refreshed FICO scores:(10)



















Greater than 660

67

%

65

%

67

%

68

%

68

%

2

(1)

67

%

68

%

(1)

660 or below

33

35

33

32

32

(2)

1

33

32

1

Total

100

%

100

%

100

%

100

%

100

%




100

%

100

%

 

 

CAPITAL ONE FINANCIAL CORPORATION (COF)

Table 11: Financial & Statistical Summary—Consumer Banking Business













2020 Q2 vs.

Six Months Ended June 30,


2020

2020

2019

2019

2019

2020

2019




2020 vs.

(Dollars in millions, except as noted)

Q2

Q1

Q4

Q3

Q2

Q1

Q2

2020

2019

2019

Consumer Banking



















Earnings:



















Net interest income

$

1,665

$

1,657

$

1,662

$

1,682

$

1,709

—

(3)

%

$

3,322

$

3,388

(2)

%

Non-interest income

97

126

152

165

166

(23)

%

(42)

223

326

(32)

Total net revenue

1,762

1,783

1,814

1,847

1,875

(1)

(6)

3,545

3,714

(5)

Provision for credit losses

876

860

335

203

165

2

**

1,736

400

**

Non-interest expense

1,036

991

1,110

985

1,002

5

3

2,027

1,996

2

Income (loss) from continuing operations before income taxes

(150)

(68)

369

659

708

121

**

(218)

1,318

**

Income tax provision (benefit)

(36)

(16)

86

154

165

125

**

(52)

307

**

Income (loss) from continuing operations, net of tax

$

(114)

$

(52)

$

283

$

505

$

543

119

**

$

(166)

$

1,011

**

Selected performance metrics:



















Period-end loans held for investment

$

66,712

$

64,033

$

63,065

$

62,015

$

60,327

4

11

$

66,712

$

60,327

11

Average loans held for investment

64,851

63,671

62,596

61,269

59,858

2

8

64,261

59,463

8

Average yield on loans held for investment(7)

8.41

%

8.46

%

8.51

%

8.47

%

8.36

%

(5)

bps

5

bps

8.44

%

8.25

%

19

bps

Auto loan originations

$

8,292

$

7,640

$

7,527

$

8,175

$

7,327

9

%

13

%

$

15,931

$

13,549

18

%

Period-end deposits

246,804

217,607

213,099

206,423

205,220

13

20

246,804

205,220

20

Average deposits

232,293

215,071

209,783

204,933

204,164

8

14

223,682

202,627

10

Average deposits interest rate

0.89

%

1.06

%

1.20

%

1.31

%

1.26

%

(17)

bps

(37)

bps

0.97

%

1.22

%

(25)

bps

Net charge-off rate

1.19

1.54

1.93

1.64

1.15

(35)

4

1.36

1.32

4

30+ day performing delinquency rate

3.16

5.12

6.63

6.23

5.87

(196)

(271)

3.16

5.87

(271)

30+ day delinquency rate

3.48

5.65

7.34

6.86

6.41

(217)

(293)

3.48

6.41

(293)

Nonperforming loan rate(3)

0.43

0.63

0.81

0.74

0.66

(20)

(23)

0.43

0.66

(23)

Nonperforming asset rate(4)

0.46

0.71

0.91

0.83

0.75

(25)

(29)

0.46

0.75

(29)

Auto—At origination FICO scores:(11)



















Greater than 660

46

%

47

%

48

%

48

%

49

%

(1)

%

(3)

%

46

%

49

%

(3)

%

621 - 660

20

20

20

20

19

—

1

20

19

1

620 or below

34

33

32

32

32

1

2

34

32

2

Total

100

%

100

%

100

%

100

%

100

%




100

%

100

%


 

 

CAPITAL ONE FINANCIAL CORPORATION (COF)

Table 12: Financial & Statistical Summary—Commercial Banking Business













2020 Q2 vs.

Six Months Ended June 30,


2020

2020

2019

2019

2019

2020

2019




2020 vs.

(Dollars in millions, except as noted)

Q2

Q1

Q4

Q3

Q2

Q1

Q2

2020

2019

2019

Commercial Banking



















Earnings:



















Net interest income

$

518

$

491

$

494

$

486

$

514

5

%

1

%

$

1,009

$

1,003

1

%

Non-interest income

180

238

223

221

200

(24)

(10)

418

387

8

Total net revenue(6)

698

729

717

707

714

(4)

(2)

1,427

1,390

3

Provision for credit losses

427

856

62

93

82

(50)

**

1,283

151

**

Non-interest expense

425

412

441

414

427

3

—

837

844

(1)

Income (loss) from continuing operations before income taxes

(154)

(539)

214

200

205

(71)

**

(693)

395

**

Income tax provision (benefit)

(36)

(128)

50

46

48

(72)

**

(164)

92

**

Income (loss) from continuing operations, net of tax

$

(118)

$

(411)

$

164

$

154

$

157

(71)

**

$

(529)

$

303

**

Selected performance metrics:



















Period-end loans held for investment

$

77,490

$

81,160

$

74,508

$

73,659

$

71,992

(5)

8

$

77,490

$

71,992

8

Average loans held for investment

79,759

76,442

74,189

72,507

71,997

4

11

78,101

71,719

9

Average yield on loans held for investment(6)(7)

3.00

%

3.88

%

4.22

%

4.45

%

4.75

%

(88)

bps

(175)

bps

3.43

%

4.68

%

(125)

bps

Period-end deposits

$

35,669

$

32,822

$

32,134

$

30,923

$

30,761

9

%

16

%

$

35,669

$

30,761

16

%

Average deposits

34,635

32,238

32,034

30,693

31,364

7

10

33,437

31,092

8

Average deposits interest rate

0.30

%

0.89

%

1.10

%

1.25

%

1.28

%

(59)

bps

(98)

bps

0.58

%

1.19

%

(61)

bps

Net charge-off rate

0.51

0.57

0.35

0.33

0.09

(6)

42

0.54

0.08

46

Nonperforming loan rate(3)

0.85

0.61

0.60

0.61

0.50

24

35

0.85

0.50

35

Nonperforming asset rate(4)

0.85

0.61

0.60

0.61

0.50

24

35

0.85

0.50

35

Risk category:(12)



















Noncriticized

$

70,881

$

77,714

$

71,848

$

71,144

$

69,390

(9)

%

2

%

$

70,881

$

69,390

2

%

Criticized performing

5,949

2,952

2,181

2,035

2,211

102

169

5,949

2,211

169

Criticized nonperforming

660

494

448

449

360

34

83

660

360

83

PCI loans

—

—

31

31

31

—

**

—

31

**

Total commercial banking loans

$

77,490

$

81,160

$

74,508

$

73,659

$

71,992

(5)

8

$

77,490

$

71,992

8

Risk category as a percentage of period-end loans held for investment:(12)






















Noncriticized

91.4

%

95.8

%

96.5

%

96.6

%

96.4

%

(4)

(5)

91.4

%

96.4

%

(5)

Criticized performing

7.7

3.6

2.9

2.8

3.1

4

5

7.7

3.1

5

Criticized nonperforming

0.9

0.6

0.6

0.6

0.5

30

bps

40

bps

0.9

0.5

40

bps

Total commercial banking 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













2020 Q2 vs.

Six Months Ended June 30,


2020

2020

2019

2019

2019

2020

2019




2020 vs.

(Dollars in millions)

Q2

Q1

Q4

Q3

Q2

Q1

Q2

2020

2019

2019

Other



















Earnings:



















Net interest income (loss)

$

(92)

$

175

$

116

$

23

$

(8)

**

**

$

83

$

25

**

Non-interest loss

(26)

(51)

(44)

(34)

(26)

(49)

%

—

(77)

(31)

148

%

Total net revenue (loss)(6)

(118)

124

72

(11)

(34)

**

**

6

(6)

**

Provision (benefit) for credit losses

(1)

5

—

—

—

**

**

4

—

**

Non-interest expense(13)(14)

340

118

123

113

97

188

**

458

186

146

Income (loss) from continuing operations before income taxes

(457)

1

(51)

(124)

(131)

**

**

(456)

(192)

138

Income tax benefit

(305)

(113)

(78)

(60)

(109)

170

180

%

(418)

(215)

94

Income (loss) from continuing operations, net of tax

$

(152)

$

114

$

27

$

(64)

$

(22)

**

**

$

(38)

$

23

**

Selected performance metrics:



















Period-end deposits

$

21,765

$

19,260

$

17,464

$

19,802

$

18,554

13

17

$

21,765

$

18,554

17

Average deposits

21,416

17,344

18,223

19,456

18,106

23

18

19,379

18,809

3

Total



















Earnings:



















Net interest income

$

5,460

$

6,025

$

6,066

$

5,737

$

5,746

(9)

%

(5)

%

$

11,485

$

11,537

—

Non-interest income

1,096

1,224

1,361

1,222

1,378

(10)

(20)

2,320

2,670

(13)

%

Total net revenue

6,556

7,249

7,427

6,959

7,124

(10)

(8)

13,805

14,207

(3)

Provision for credit losses

4,246

5,423

1,818

1,383

1,342

(22)

**

9,669

3,035

**

Non-interest expense

3,770

3,729

4,161

3,872

3,779

1

—

7,499

7,450

1

Income (loss) from continuing operations before income taxes

(1,460)

(1,903)

1,448

1,704

2,003

(23)

**

(3,363)

3,722

**

Income tax provision (benefit)

(543)

(563)

270

375

387

(4)

**

(1,106)

696

**

Income (loss) from continuing operations, net of tax

$

(917)

$

(1,340)

$

1,178

$

1,329

$

1,616

(32)

**

$

(2,257)

$

3,026

**

Selected performance metrics:



















Period-end loans held for investment

$

251,512

$

262,990

$

265,809

$

249,355

$

244,460

(4)

3

$

251,512

$

244,460

3

Average loans held for investment

253,358

262,889

258,870

246,147

242,653

(4)

4

258,124

242,307

7

Period-end deposits

304,238

269,689

262,697

257,148

254,535

13

20

304,238

254,535

20

Average deposits

288,344

264,653

260,040

255,082

253,634

9

14

276,498

252,528

9

 

 

CAPITAL ONE FINANCIAL CORPORATION (COF)

Table 14: Notes to Loan, Allowance and Business Segment Disclosures (Tables 7—13)


(1)

Concurrent with our adoption of the CECL standard in the first quarter of 2020, we reclassified our finance charge and fee reserve to our allowance for credit

losses, with a corresponding increase to credit card loans held for investment.

(2)

Metrics for Q2 2020 and Q1 2020 include the impact of COVID-19 customer assistance programs where applicable.

(3)

Nonperforming loan rates are calculated based on nonperforming loans for each category divided by period-end total loans held for investment for each

respective category.

(4)

Nonperforming assets consist of nonperforming loans, repossessed assets and other foreclosed assets. The total nonperforming asset rate is calculated

based on total nonperforming assets divided by the combined period-end total loans held for investment, repossessed assets and other foreclosed assets.

(5)

Represents foreign currency translation adjustments.

(6)

Some of our commercial investments generate tax-exempt income, tax credits or other tax benefits. Accordingly, we present our Commercial Banking revenue

and yields on a taxable-equivalent basis, calculated using the federal statutory tax rate of 21% and state taxes where applicable, with offsetting reductions to

the Other category.

(7)

Average yield on loans held for investment is calculated based on annualized interest income for the period divided by average loans held for investment

during the period for the respective loan category. Annualized interest income is computed based on the effective yield of the respective loan category and

does not include any allocations, such as funds transfer pricing.

(8)

Total net revenue margin is calculated based on annualized total net revenue for the period divided by average loans held for investment during the period

for the respective loan category.

(9)

Purchase volume consists of purchase transactions, net of returns, for the period, and excludes cash advance and balance transfer transactions.

(10)

Percentages represent period-end loans held for investment in each credit score category. Domestic card credit scores generally represent FICO scores.

These scores are obtained from one of the major credit bureaus at origination and are refreshed monthly thereafter. We approximate non-FICO credit scores

to comparable FICO scores for consistency purposes. Balances for which no credit score is available or the credit score is invalid are included in the 660 or

below category.

(11)

Percentages represent period-end loans held for investment in each credit score category. Auto credit scores generally represent average FICO scores

obtained from three credit bureaus at the time of application and are not refreshed thereafter. Balances for which no credit score is available or the credit score

is invalid are included in the 620 or below category.

(12)

Criticized exposures correspond to the "Special Mention," "Substandard" and "Doubtful" asset categories defined by bank regulatory authorities.

(13)

Includes charges incurred as a result of restructuring activities.

(14)

Includes net Cybersecurity Incident expenses of $11 million in Q2 2020, $4 million in Q1 2020, $16 million in Q4 2019 and $22 million in Q3 2019, respectively.

**

Not meaningful.

 

 

CAPITAL ONE FINANCIAL CORPORATION (COF)

Table 15: Calculation of Regulatory Capital Measures and Reconciliation of Non-GAAP Measures(1)



Basel III Standardized Approach

(Dollars in millions, except as noted)

June 30,
2020

March 31,
2020

December 31,
2019

September 30,
2019

June 30,
2019

Regulatory Capital Metrics









Common equity excluding AOCI

$

50,614

$

51,018

$

52,001

$

51,959

$

51,236

Adjustments:









AOCI, net of tax(2)

(145)

(170)

1,156

453

170

Goodwill, net of related deferred tax liabilities

(14,449)

(14,453)

(14,465)

(14,439)

(14,365)

Intangible assets, net of related deferred tax liabilities

(135)

(151)

(170)

(180)

(194)

Other(2)

—

—

(360)

(588)

(401)

Common equity Tier 1 capital

$

35,885

$

36,244

$

38,162

$

37,205

$

36,446

Tier 1 capital

$

41,094

$

41,453

$

43,015

$

43,028

$

40,806

Total capital(3)

48,506

48,775

50,350

50,174

47,919

Risk-weighted assets

290,062

302,871

313,155

298,130

295,255

Adjusted average assets(4)

398,062

377,360

368,511

360,266

356,518

Capital Ratios









Common equity Tier 1 capital(5)

12.4

%

12.0

%

12.2

%

12.5

%

12.3

%

Tier 1 capital(6)

14.2

13.7

13.7

14.4

13.8

Total capital(7)

16.7

16.1

16.1

16.8

16.2

Tier 1 leverage(4)

10.3

11.0

11.7

11.9

11.4

Tangible common equity ("TCE")(8)

8.8

9.6

10.2

10.3

10.2

 

 

Reconciliation of Non-GAAP Measures

The following non-GAAP measures consist of our adjusted results that we believe help investors and users of our financial information understand the effect of adjusting items on our selected reported results. These adjusted results provide alternate measurements of our operating

performance, both for the current period and trends across multiple periods. The following tables present reconciliations of these non-GAAP measures to the applicable amounts measured in accordance with GAAP.



2020

2020

Six Months Ended


Q2

Q1

June 30, 2020

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

Reported
Results

Adj.(9)

Adjusted
Results

Reported
Results

Adj.(9)

Adjusted
Results

Reported
Results

Adj.(9)

Adjusted
Results

Selected income statement data:

















Net interest income

$

5,460

—

$

5,460

$

6,025

—

$

6,025

$

11,485

—

$

11,485

Non-interest income

1,096

—

1,096

1,224

—

1,224

2,320

—

2,320

Total net revenue

6,556

—

6,556

7,249

—

7,249

13,805

—

13,805

Provision for credit losses

4,246

—

4,246

5,423

—

5,423

9,669

—

9,669

Non-interest expense

3,770

$

(276)

3,494

3,729

$

(49)

3,680

7,499

$

(325)

7,174

Income (loss) from continuing operations before income taxes

(1,460)

276

(1,184)

(1,903)

49

(1,854)

(3,363)

325

(3,038)

Income tax provision (benefit)

(543)

3

(540)

(563)

12

(551)

(1,106)

15

(1,091)

Income (loss) from continuing operations, net of tax

(917)

273

(644)

(1,340)

37

(1,303)

(2,257)

310

(1,947)

Income (loss) from discontinued operations, net of tax

(1)

—

(1)

—

—

—

(1)

—

(1)

Net income (loss)

(918)

273

(645)

(1,340)

37

(1,303)

(2,258)

310

(1,948)

Dividends and undistributed earnings allocated to participating securities(10)

(1)

—

(1)

(3)

—

(3)

(4)

—

(4)

Preferred stock dividends

(90)

—

(90)

(55)

—

(55)

(145)

—

(145)

Issuance cost for redeemed preferred stock

—

—

—

(22)

—

(22)

(22)

—

(22)

Net income (loss) available to common stockholders

$

(1,009)

$

273

$

(736)

$

(1,420)

$

37

$

(1,383)

$

(2,429)

$

310

$

(2,119)

Selected performance metrics:

















Diluted EPS(10)

$

(2.21)

$

0.60

$

(1.61)

$

(3.10)

$

0.08

$

(3.02)

$

(5.31)

$

0.67

$

(4.64)

Efficiency ratio

57.50

%

(421)

bps

53.29

%

51.44

%

(67)

bps

50.77

%

54.32

%

(235)

bps

51.97

%

Operating efficiency ratio

53.34

(421)

49.13

44.67

(68)

43.99

48.79

(236)

46.43


























































2019

2019

Six Months Ended


Q2

Q1

June 30, 2019

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

Reported
Results

Adj.(9)

Adjusted
Results

Reported
Results

Adj.(9)

Adjusted
Results

Reported
Results

Adj.(9)

Adjusted
Results

Selected income statement data:

















Net interest income

$

5,746

—

$

5,746

$

5,791

—

$

5,791

$

11,537

—

$

11,537

Non-interest income

1,378

$

1

1,379

1,292

—

1,292

2,670

$

1

2,671

Total net revenue

7,124

1

7,125

7,083

—

7,083

14,207

1

14,208

Provision for credit losses

1,342

—

1,342

1,693

—

1,693

3,035

—

3,035

Non-interest expense

3,779

(81)

3,698

3,671

$

(25)

3,646

7,450

(106)

7,344

Income from continuing operations before income taxes

2,003

82

2,085

1,719

25

1,744

3,722

107

3,829

Income tax provision

387

19

406

309

6

315

696

25

721

Income from continuing operations, net of tax

1,616

63

1,679

1,410

19

1,429

3,026

82

3,108

Income from discontinued operations, net of tax

9

—

9

2

—

2

11

—

11

Net income

1,625

63

1,688

1,412

19

1,431

3,037

82

3,119

Dividends and undistributed earnings allocated to participating securities(10)

(12)

(1)

(13)

(12)

—

(12)

(24)

(1)

(25)

Preferred stock dividends

(80)

—

(80)

(52)

—

(52)

(132)

—

(132)

Net income available to common stockholders

$

1,533

$

62

$

1,595

$

1,348

$

19

$

1,367

$

2,881

$

81

$

2,962

Selected performance metrics:

















Diluted EPS(10)

$

3.24

$

0.13

$

3.37

$

2.86

$

0.04

$

2.90

$

6.10

$

0.17

$

6.27

Efficiency ratio

53.05

%

(115)

bps

51.90

%

51.83

%

(35)

bps

51.48

%

52.44

%

(75)

bps

51.69

%

Operating efficiency ratio

45.38

(114)

44.24

44.53

(35)

44.18

44.96

(75)

44.21

 

 

Reconciliation of Non-GAAP Measures

The following non-GAAP measures consist of TCE, tangible assets and metrics computed using these amounts, which include tangible book value per common share, return on average tangible assets, return

on average TCE and TCE ratio. We consider these metrics to be key financial performance measures that management uses in assessing capital adequacy and the level of returns generated. While our non-

GAAP measures are widely used by investors, analysts and bank regulatory agencies to assess the capital position of financial services companies, they may not be comparable to similarly-titled measures

reported by other companies. The following tables present reconciliations of these non-GAAP measures to the applicable amounts measured in accordance with GAAP.



2020

2020

2019

2019

2019

(Dollars in millions)

Q2

Q1

Q4

Q3

Q2

Tangible Common Equity (Period-End)









Stockholders' equity

$

56,045

$

56,830

$

58,011

$

58,235

$

55,767

Goodwill and intangible assets(11)

(14,869)

(14,888)

(14,932)

(14,940)

(14,886)

Noncumulative perpetual preferred stock

(5,209)

(5,209)

(4,853)

(5,823)

(4,360)

Tangible common equity

$

35,967

$

36,733

$

38,226

$

37,472

$

36,521

Tangible Common Equity (Average)









Stockholders' equity

$

57,623

$

58,568

$

58,148

$

57,245

$

54,570

Goodwill and intangible assets(11)

(14,880)

(14,930)

(14,967)

(14,908)

(14,900)

Noncumulative perpetual preferred stock

(5,209)

(5,382)

(5,506)

(4,678)

(4,360)

Tangible common equity

$

37,534

$

38,256

$

37,675

$

37,659

$

35,310

Tangible Assets (Period-End)









Total assets

$

421,296

$

396,878

$

390,365

$

378,810

$

373,619

Goodwill and intangible assets(11)

(14,869)

(14,888)

(14,932)

(14,940)

(14,886)

Tangible assets

$

406,427

$

381,990

$

375,433

$

363,870

$

358,733

Tangible Assets (Average)









Total assets

$

411,075

$

390,380

$

383,162

$

374,905

$

371,095

Goodwill and intangible assets(11)

(14,880)

(14,930)

(14,967)

(14,908)

(14,900)

Tangible assets

$

396,195

$

375,450

$

368,195

$

359,997

$

356,195

__________

(1)   Regulatory capital metrics and capital ratios as of June 30, 2020 are preliminary and therefore subject to change.

(2)   In the first quarter of 2020, we elected to exclude from our regulatory capital ratios certain components of AOCI as permitted under the Tailoring Rules. As such, we revised our presentation herein to only 
        include those components of AOCI that impact our regulatory capital ratios.

(3)   Total capital equals the sum of Tier 1 capital and Tier 2 capital.

(4)   Adjusted average assets for the purpose of calculating our Tier 1 leverage ratio represents total average assets adjusted for amounts that are deducted from Tier 1 capital, predominately goodwill and 
        intangible assets. Tier 1 leverage ratio is a regulatory capital measure calculated based on Tier 1 capital divided by adjusted average assets.

(5)   Common equity Tier 1 capital ratio is a regulatory capital measure calculated based on common equity Tier 1 capital divided by risk-weighted assets.

(6)   Tier 1 capital ratio is a regulatory capital measure calculated based on Tier 1 capital divided by risk-weighted assets.

(7)   Total capital ratio is a regulatory capital measure calculated based on total capital divided by risk-weighted assets.

(8)   TCE ratio is a non-GAAP measure calculated based on TCE divided by tangible assets.

(9)   The adjustments for the following periods consist of:



2020

2020

Six Months Ended

2019

2019

Six Months Ended

(Dollars in millions)

Q2

Q1

June 30, 2020

Q2

Q1

June 30, 2019

Legal reserve builds

$

265

$

45

$

310

—

—

—

Cybersecurity Incident expenses, net of insurance

11

4

15

—

—

—

Walmart launch and related integration expenses

—

—

—

$

54

$

25

$

79

Restructuring charges

—

—

—

28

—

28

Total

276

49

325

82

25

107

Income tax provision

3

12

15

19

6

25

Net income

$

273

$

37

$

310

$

63

$

19

$

82

(10)   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.

(11)    Includes impact of related deferred taxes.

 

Cision View original content:http://www.prnewswire.com/news-releases/capital-one-reports-second-quarter-2020-net-loss-of-918-million-or-2-21-per-share-301097382.html

SOURCE Capital One Financial Corporation

Investor Relations: Jeff Norris, jeff.norris@capitalone.com; Danielle Dietz, danielle.dietz@capitalone.com; Media Relations: Sie Soheili, sie.soheili@capitalone.com; Tatiana Stead, tatiana.stead@capitalone.com