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Capital One Reports First Quarter 2017 Net Income of $810 million, or $1.54 per share
Excluding adjusting items, First Quarter 2017 Net Income of $910 million or $1.75 per share(1)

MCLEAN, Va., April 25, 2017 /PRNewswire/ -- Capital One Financial Corporation (NYSE: COF) today announced net income for the first quarter of 2017 of $810 million, or $1.54 per diluted common share, compared to the fourth quarter of 2016 with net income of $791 million, or $1.45 per diluted common share, and the first quarter of 2016 with net income of $1.0 billion, or $1.84 per diluted common share. We recorded a build in the U.K. Payment Protection Insurance customer refund reserve ("U.K. PPI Reserve") of $99 million in the first quarter of 2017. Excluding this adjusting item, net income for the first quarter of 2017 was $910 million or $1.75 per diluted common share(1).

"In the first quarter, we continued to deliver resilient growth," said Richard D. Fairbank, Founder, Chairman and Chief Executive Officer.  "As banking is being revolutionized by digital, we are investing to lead the transformation and drive growth opportunities.  We are improving efficiency.  And we are building an enduring customer franchise.  We remain well positioned to deliver attractive growth and returns, as well as significant capital distribution, subject to regulatory approval."

All comparisons below are for the first quarter of 2017 compared with the fourth quarter of 2016 unless otherwise noted.

First Quarter 2017 Income Statement Summary:

  • Total net revenue remained flat at $6.5 billion.
  • Total non-interest expense decreased 7 percent to $3.4 billion:
    • 31 percent decrease in marketing.
    • 1 percent decrease in operating expenses.
  • Pre-provision earnings increased 7 percent to $3.1 billion(2).
  • Provision for credit losses increased 14 percent to $2.0 billion:
    • Net charge-offs of $1.5 billion.
    • $482 million reserve build.
  • Net interest margin of 6.88 percent, up 3 basis points.
  • Efficiency ratio of 52.55 percent:
    • Efficiency ratio excluding the U.K. PPI Reserve build of $99 million was 51.55 percent(1).

First Quarter 2017 Balance Sheet Summary:

  • Common equity Tier 1 capital ratio under Basel III Standardized Approach of 10.4 percent at March 31, 2017.
  • Period-end loans held for investment in the quarter decreased $5.0 billion, or 2 percent, to $240.6 billion.
    • Domestic Card period-end loans decreased $6.0 billion, or 6 percent, to $91.1 billion.
    • Consumer Banking period-end loans increased $928 million, or 1 percent, to $74.0 billion:
      • Auto period-end loans increased $1.9 billion, or 4 percent, to $49.8 billion.
      • Home loans period-end loans decreased $846 million, or 4 percent, to $20.7 billion, driven by run-off of acquired portfolios.
    • Commercial Banking period-end loans increased $404 million, or 1 percent, to $67.3 billion.
  • Average loans held for investment in the quarter increased $1.5 billion, or less than 1 percent, to $241.5 billion.
    • Domestic Card average loans increased $411 million, or less than 1 percent, to $93.0 billion.
    • Consumer Banking average loans increased $672 million, or 1 percent, to $73.3 billion:
      • Auto average loans increased $1.5 billion, or 3 percent, to $48.7 billion.
      • Home loans average loans decreased $835 million, or 4 percent, to $21.1 billion, driven by run-off of acquired portfolios.
    • Commercial Banking average loans increased $423 million, or 1 percent, to $66.9 billion.
  • Period-end total deposits increased $4.4 billion, or 2 percent, to $241.2 billion, while average deposits increased $6.3 billion, or 3 percent, to $238.6 billion.
  • Interest-bearing deposits rate paid increased 2 basis points to 0.66 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. 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 April 25, 2017 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 May 9, 2017 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, 2016.

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 $241.2 billion in deposits and $348.5 billion in total assets as of  March 31, 2017. 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)

First Quarter 2017

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

10


Table 7:

Loan Information and Performance Statistics

11


Table 8:

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

13

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


Table 14:

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

20

Other



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 March 31, 2017 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














2017 Q1 vs.

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


2017


2016


2016


2016


2016


2016


2016


Q1


Q4


Q3


Q2


Q1


Q4


Q1

Income Statement















Net interest income


$

5,474



$

5,447



$

5,277



$

5,093



$

5,056





8

%

Non-interest income


1,061



1,119



1,184



1,161



1,164



(5)

%


(9)


Total net revenue(1)


6,535



6,566



6,461



6,254



6,220





5


Provision for credit losses


1,992



1,752



1,588



1,592



1,527



14



30


Non-interest expense:















Marketing


396



575



393



415



428



(31)



(7)


Amortization of intangibles


62



101



89



95



101



(39)



(39)


Operating expenses


2,976



3,003



2,879



2,785



2,694



(1)



10


Total non-interest expense


3,434



3,679



3,361



3,295



3,223



(7)



7


Income from continuing operations before income taxes


1,109



1,135



1,512



1,367



1,470



(2)



(25)


Income tax provision


314



342



496



424



452



(8)



(31)


Income from continuing operations, net of tax


795



793



1,016



943



1,018





(22)


Income (loss) from discontinued operations, net of tax(2)


15



(2)



(11)



(1)



(5)



**



**

Net income


810



791



1,005



942



1,013



2



(20)


Dividends and undistributed earnings allocated to participating securities(3)


(5)



(6)



(6)



(6)



(6)



(17)



(17)


Preferred stock dividends


(53)



(75)



(37)



(65)



(37)



(29)



43


Net income available to common stockholders


$

752



$

710



$

962



$

871



$

970



6



(22)


Common Share Statistics















Basic earnings per common share:(3)















Net income from continuing operations


$

1.53



$

1.47



$

1.94



$

1.70



$

1.86



4

%


(18)

%

Income (loss) from discontinued operations


0.03





(0.02)





(0.01)



**



**

Net income per basic common share


$

1.56



$

1.47



$

1.92



$

1.70



$

1.85



6



(16)


Diluted earnings per common share:(3)















Net income from continuing operations


$

1.51



$

1.45



$

1.92



$

1.69



$

1.85



4



(18)


Income (loss) from discontinued operations


0.03





(0.02)





(0.01)



**



**

Net income per diluted common share


$

1.54



$

1.45



$

1.90



$

1.69



$

1.84



6



(16)


Weighted-average common shares outstanding (in millions):















Basic


482.3



483.5



501.1



511.7



523.5





(8)


Diluted


487.9



489.2



505.9



516.5



528.0





(8)


Common shares outstanding (period-end, in millions)


482.8



480.2



489.2



505.9



514.5



1



(6)


Dividends paid per common share


$

0.40



$

0.40



$

0.40



$

0.40



$

0.40






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


58.66



57.76



59.00



57.84



55.94



2



5















2017 Q1 vs.

(Dollars in millions)


2017


2016


2016


2016


2016


2016


2016


Q1


Q4


Q3


Q2


Q1


Q4


Q1

Balance Sheet (Period-End)















Loans held for investment(5)


$

240,588



$

245,586



$

238,019



$

234,603



$

227,613



(2)

%


6

%

Interest-earning assets


316,712



321,807



313,431



307,163



298,348



(2)



6


Total assets


348,549



357,033



345,061



339,117



330,346



(2)



6


Interest-bearing deposits


214,818



211,266



200,416



195,635



196,597



2



9


Total deposits


241,182



236,768



225,981



221,059



221,779



2



9


Borrowings


48,439



60,460



59,820



59,181



50,497



(20)



(4)


Common equity


43,680



43,154



44,336



44,813



44,411



1



(2)


Total stockholders' equity


48,040



47,514



48,213



48,108



47,707



1



1


Balance Sheet (Average Balances)















Loans held for investment(5)


$

241,505



$

240,027



$

235,843



$

230,379



$

226,736



1

%


7

%

Interest-earning assets


318,358



317,853



310,987



302,764



299,456





6


Total assets


351,641



350,225



343,153



334,479



331,919





6


Interest-bearing deposits


212,973



206,464



196,913



195,641



194,125



3



10


Total deposits


238,550



232,204



222,251



221,146



219,180



3



9


Borrowings


53,357



58,624



60,708



54,359



53,761



(9)



(1)


Common equity


43,833



43,921



45,314



45,640



45,782





(4)


Total stockholders' equity


48,193



47,972



49,033



48,934



49,078





(2)


 

 

CAPITAL ONE FINANCIAL CORPORATION (COF)

Table 2: Selected Metrics—Consolidated














2017 Q1 vs.

(Dollars in millions, except as noted)


2017


2016


2016


2016


2016


2016


2016


Q1


Q4


Q3


Q2


Q1


Q4


Q1

Performance Metrics















Net interest income growth (period over period)




3

%


4

%


1

%


2

%


**



**


Non-interest income growth (period over period)


(5)

%


(5)



2





(6)



**



**


Total net revenue growth (period over period)




2



3



1





**



**


Total net revenue margin(6)


8.21



8.26



8.31



8.26



8.31



(5)

bps


(10)

bps

Net interest margin(7)


6.88



6.85



6.79



6.73



6.75



3



13


Return on average assets


0.90



0.91



1.18



1.13



1.23



(1)



(33)


Return on average tangible assets(8)


0.95



0.95



1.24



1.18



1.29





(34)


Return on average common equity(9)


6.73



6.48



8.59



7.64



8.52



25



(179)


Return on average tangible common equity(10)


10.37



10.00



13.06



11.61



12.94



37



(257)


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


5.69



6.13



5.70



5.72



5.69



(44)




Efficiency ratio(11)


52.55



56.03



52.02



52.69



51.82



(348)



73


Effective income tax rate for continuing operations


28.3



30.1



32.8



31.0



30.7



(180)



(240)


Employees (in thousands), period-end


48.4



47.3



46.5



46.1



45.8



2

%


6

%

Credit Quality Metrics















Allowance for loan and lease losses


$

6,984



$

6,503



$

6,258



$

5,881



$

5,416



7

%


29

%

Allowance as a percentage of loans held for investment


2.90

%


2.65

%


2.63

%


2.51

%


2.38

%


25

bps


52

bps

Net charge-offs


$

1,510



$

1,489



$

1,240



$

1,155



$

1,178



1

%


28

%

Net charge-off rate(12)


2.50

%


2.48

%


2.10

%


2.01

%


2.08

%


2

bps


42

bps

30+ day performing delinquency rate


2.61



2.93



2.71



2.47



2.33



(32)



28


30+ day delinquency rate


2.92



3.27



3.04



2.79



2.64



(35)



28


Capital Ratios(13)















Common equity Tier 1 capital


10.4

%


10.1

%


10.6

%


10.9

%


11.1

%


30

bps


(70)

bps

Tier 1 capital


12.0



11.6



12.0



12.2



12.4



40



(40)


Total capital


14.7



14.3



14.7



14.4



14.6



40



10


Tier 1 leverage


9.9



9.9



10.1



10.2



10.2





(30)


Tangible common equity ("TCE")(14)


8.5



8.1



8.8



9.0



9.1



40



(60)


 

 

CAPITAL ONE FINANCIAL CORPORATION (COF)

Table 3: Consolidated Statements of Income




Three Months Ended


2017 Q1 vs.



2017


2016


2016


2016


2016

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


Q1


Q4


Q1


Q4


Q1

Interest income:











Loans, including loans held for sale


$

5,626



$

5,587



$

5,085



1

%


11

%

Investment securities


416



393



415



6




Other


28



29



17



(3)



65


Total interest income


6,070



6,009



5,517



1



10


Interest expense:











Deposits


353



332



283



6



25


Securitized debt obligations


69



65



48



6



44


Senior and subordinated notes


149



138



106



8



41


Other borrowings


25



27



24



(7)



4


Total interest expense


596



562



461



6



29


Net interest income


5,474



5,447



5,056





8


Provision for credit losses


1,992



1,752



1,527



14



30


Net interest income after provision for credit losses


3,482



3,695



3,529



(6)



(1)


Non-interest income:(15)(16)











Service charges and other customer-related fees


371



412



423



(10)



(12)


Interchange fees, net


570



624



604



(9)



(6)


Net securities gains (losses)




(4)



(8)



**


**

Other


120



87



145



38



(17)


Total non-interest income


1,061



1,119



1,164



(5)



(9)


Non-interest expense:(15)(16)











Salaries and associate benefits


1,471



1,336



1,270



10



16


Occupancy and equipment


471



522



458



(10)



3


Marketing


396



575



428



(31)



(7)


Professional services


247



312



241



(21)



2


Communications and data processing


288



297



280



(3)



3


Amortization of intangibles


62



101



101



(39)



(39)


Other


499



536



445



(7)



12


Total non-interest expense


3,434



3,679



3,223



(7)



7


Income from continuing operations before income taxes


1,109



1,135



1,470



(2)



(25)


Income tax provision


314



342



452



(8)



(31)


Income from continuing operations, net of tax


795



793



1,018





(22)


Income (loss) from discontinued operations, net of tax(2)


15



(2)



(5)



**


**

Net income


810



791



1,013



2



(20)


Dividends and undistributed earnings allocated to participating securities(3)


(5)



(6)



(6)



(17)



(17)


Preferred stock dividends


(53)



(75)



(37)



(29)



43


Net income available to common stockholders


$

752



$

710



$

970



6



(22)















Three Months Ended


2017 Q1 vs.



2017


2016


2016


2016


2016

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


Q1


Q4


Q1


Q4


Q1

Basic earnings per common share:(3)











Net income from continuing operations


$

1.53



$

1.47



$

1.86



4

%


(18)

%

Income (loss) from discontinued operations


0.03





(0.01)



**


**

Net income per basic common share


$

1.56



$

1.47



$

1.85



6



(16)


Diluted earnings per common share:(3)











Net income from continuing operations


$

1.51



$

1.45



$

1.85



4



(18)


Income (loss) from discontinued operations


0.03





(0.01)



**


**

Net income per diluted common share


$

1.54



$

1.45



$

1.84



6



(16)


Weighted-average common shares outstanding (in millions):











Basic common shares


482.3



483.5



523.5





(8)


Diluted common shares


487.9



489.2



528.0





(8)


Dividends paid per common share


$

0.40



$

0.40



$

0.40






 

 

CAPITAL ONE FINANCIAL CORPORATION (COF)

Table 4: Consolidated Balance Sheets














2017 Q1 vs.



2017


2016


2016


2016


2016


2016


2016

(Dollars in millions)


Q1


Q4


Q3


Q2


Q1


Q4


Q1

Assets:















Cash and cash equivalents:















Cash and due from banks


$

3,489



$

4,185



$

3,350



$

3,253



$

3,241



(17)

%


8

%

Interest-bearing deposits and other short-term investments


5,826



5,791



5,744



3,896



1,994



1



192


Total cash and cash equivalents


9,315



9,976



9,094



7,149



5,235



(7)



78


Restricted cash for securitization investors


486



2,517



287



265



960



(81)



(49)


Securities available for sale, at fair value


41,260



40,737



41,511



39,960



40,092



1



3


Securities held to maturity, at carrying value


26,170



25,712



25,019



25,120



25,080



2



4


Loans held for investment:(5)















Unsecuritized loans held for investment


211,038



213,824



206,763



202,778



195,705



(1)



8


Loans held in consolidated trusts


29,550



31,762



31,256



31,825



31,908



(7)



(7)


Total loans held for investment


240,588



245,586



238,019



234,603



227,613



(2)



6


Allowance for loan and lease losses


(6,984)



(6,503)



(6,258)



(5,881)



(5,416)



7



29


Net loans held for investment


233,604



239,083



231,761



228,722



222,197



(2)



5


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


735



1,043



994



1,220



1,251



(30)



(41)


Premises and equipment, net


3,727



3,675



3,561



3,556



3,542



1



5


Interest receivable


1,368



1,351



1,251



1,236



1,221



1



12


Goodwill


14,521



14,519



14,493



14,495



14,492






Other assets


17,363



18,420



17,090



17,394



16,276



(6)



7


Total assets


$

348,549



$

357,033



$

345,061



$

339,117



$

330,346



(2)



6






























2017 Q1 vs.



2017


2016


2016


2016


2016


2016


2016

(Dollars in millions)


Q1


Q4


Q3


Q2


Q1


Q4


Q1

Liabilities:















Interest payable


$

260



$

327



$

237



$

301



$

217



(20)

%


20

%

Deposits:















Non-interest-bearing deposits


26,364



25,502



25,565



25,424



25,182



3



5


Interest-bearing deposits


214,818



211,266



200,416



195,635



196,597



2



9


Total deposits


241,182



236,768



225,981



221,059



221,779



2



9


Securitized debt obligations


18,528



18,826



18,411



16,130



14,913



(2)



24


Other debt:















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


1,046



992



1,079



999



917



5



14


Senior and subordinated notes


26,405



23,431



24,001



21,872



21,736



13



21


Other borrowings


2,460



17,211



16,329



20,180



12,931



(86)



(81)


Total other debt


29,911



41,634



41,409



43,051



35,584



(28)



(16)


Other liabilities


10,628



11,964



10,810



10,468



10,146



(11)



5


Total liabilities


300,509



309,519



296,848



291,009



282,639



(3)



6

















Stockholders' equity:















Preferred stock


0



0



0



0



0






Common stock


7



7



7



7



7






Additional paid-in capital, net


31,326



31,157



30,439



29,786



29,709



1



5


Retained earnings


30,326



29,766



29,245



28,479



27,808



2



9


Accumulated other comprehensive income (loss)


(934)



(949)



121



241



(41)



(2)



**

Treasury stock, at cost


(12,685)



(12,467)



(11,599)



(10,405)



(9,776)



2



30


Total stockholders' equity


48,040



47,514



48,213



48,108



47,707



1



1


Total liabilities and stockholders' equity


$

348,549



$

357,033



$

345,061



$

339,117



$

330,346



(2)



6


 

 

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 $321 million in both Q1 2017 and Q4 2016, $289 million in Q3 2016, $244 million in Q2 2016 and $228 million in Q1 2016 for the estimated uncollectible amount of billed finance 
           charges and fees and related losses.

(2)        The provision (benefit) for mortgage representation and warranty losses included the following activity:




2017


2016


2016


2016


2016

(Dollars in millions)


Q1


Q4


Q3


Q2


Q1

Provision (benefit) for mortgage representation and warranty losses before income taxes:











Recorded in continuing operations


$

(25)









$

(1)



$

(1)


Recorded in discontinued operations


(67)



$

(2)



$

18



2



3


Total provision (benefit) for mortgage representation and warranty losses before income taxes


$

(92)



$

(2)



$

18



$

1



$

2



           The mortgage representation and warranty reserve was $516 million as of March 31, 2017, $630 million as of December 31, 2016, $632 million as of September 30, 2016, $614 million as of June 30, 2016 and $613 
           million as of March 31, 2016.

(3)        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.

(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)        Included in loans held for investment are purchased credit-impaired loans ("PCI loans") recorded at fair value at acquisition and subsequently accounted for based on estimated cash flows expected to be collected 
           over the life of the loans (under the accounting standard formerly known as "SOP 03-3," or Accounting Standards Codification 310-30). These include certain of our consumer and commercial loans that were 
           acquired through business combinations. The table below presents amounts related to PCI loans:




2017


2016


2016


2016


2016

(Dollars in millions)


Q1


Q4


Q3


Q2


Q1

PCI loans:











Period-end unpaid principal balance


$

14,838



$

15,896



$

17,011



$

18,256



$

19,492


Period-end loans held for investment


14,102



15,071



16,149



17,358



18,568


Average loans held for investment


14,433



15,443



16,529



17,783



18,894



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

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

(8)        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.

(9)        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.

(10)      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.

(11)      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.

(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)      Capital ratios as of the end of Q1 2017 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.

(14)      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.

(15)      We made certain Non-interest income and Non-interest expense reclassifications in Q4 2016. The changes were primarily related to a reclassification of certain consumer and commercial banking income from Other 
           to Service charges and other customer-related fees within Non-interest income, and a reclassification of certain system processing costs from Professional services to Communications and data processing within 
           Non-interest expense. We have also consolidated the Non-interest income presentation of Other-than-temporary impairment ("OTTI") with net realized gains or losses from investment securities into a new Net 
           securities gains (losses) line. These reclassifications were made to better reflect the nature of income earned and expenses incurred. All prior period amounts presented have been reclassified to conform to the 
           current period presentation.

(16)      The primary net effects of the reclassifications discussed in footnote 15 above for Q1 2016 compared to previously reported results were (i) an increase to Service charges and other customer-related fees of $19 
           million; (ii) a decrease to Other non-interest income of $27 million; and (iii) an increase to Communications and data processing expense of $37 million, with a corresponding decrease to Professional services.

**        Not meaningful.

 

 

CAPITAL ONE FINANCIAL CORPORATION (COF)

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




2017 Q1


2016 Q4


2016 Q1



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


$

242,249



$

5,626



9.29

%


$

241,110



$

5,587



9.27

%


$

227,573



$

5,085



8.94

%