Capital One Reports Second Quarter 2017 Net Income of $1.0 billion, or $1.94 per share

Excluding adjusting items, Second Quarter 2017 Net Income of $1.96 per share(1)

MCLEAN, Va., July 20, 2017 /PRNewswire/ -- Capital One Financial Corporation (NYSE: COF) today announced net income for the second quarter of 2017 of $1.0 billion, or $1.94 per diluted common share, compared with net income of $810 million, or $1.54 per diluted common share in the first quarter of 2017, and with net income of $942 million, or $1.69 per diluted common share in the second quarter of 2016. During the quarter, we incurred $12 million of costs related to our anticipated close of the Cabela's acquisition, which is subject to regulatory approval. Excluding this adjusting item, net income for the second quarter of 2017 was $1.96 per diluted common share(1).

Capital One

"We delivered another quarter of resilient growth across our businesses," said Richard D. Fairbank, Founder, Chairman and Chief Executive Officer. "We're investing to grow and transform our company as banking goes digital, we're driving improving efficiency, and we are building an enduring customer franchise. We continue to be in a strong position to deliver attractive growth and returns, as well as significant capital distribution, subject to regulatory approval."

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

Second Quarter 2017 Income Statement Summary:

  • Total net revenue increased 3 percent to $6.7 billion.
  • Total non-interest expense decreased 1 percent to $3.4 billion:
    • 2 percent decrease in operating expenses.
    • 10 percent increase in marketing.
  • Pre-provision earnings increased 6 percent to $3.3 billion(2).
  • Provision for credit losses decreased 10 percent to $1.8 billion:
    • Net charge-offs of $1.6 billion.
    • $182 million reserve build.
  • Net interest margin flat at 6.88 percent.
  • Efficiency ratio of 50.92 percent:
    • Efficiency ratio excluding adjusting items was 50.75 percent(1).

Second Quarter 2017 Balance Sheet Summary:

  • Common equity Tier 1 capital ratio under Basel III Standardized Approach of 10.7 percent at June 30, 2017.
  • Period-end loans held for investment in the quarter increased $3.7 billion, or 2 percent, to $244.3 billion.
    • Domestic Card period-end loans increased $1.8 billion, or 2 percent, to $92.9 billion.
    • Consumer Banking period-end loans increased $991 million, or 1 percent, to $75.0 billion:
      • Auto period-end loans increased $2.0 billion, or 4 percent, to $51.8 billion.
      • Home loans period-end loans decreased $1.0 billion, or 5 percent, to $19.7 billion, driven by run-off of acquired portfolios.
    • Commercial Banking period-end loans increased $352 million, or 1 percent, to $67.7 billion.
  • Average loans held for investment in the quarter increased $736 million, or less than 1 percent, to $242.2 billion.
    • Domestic Card average loans decreased $1.3 billion, or 1 percent, to $91.8 billion.
    • Consumer Banking average loans increased $1.1 billion, or 2 percent, to $74.5 billion:
      • Auto average loans increased $2.1 billion, or 4 percent, to $50.8 billion.
      • Home loans average loans decreased $946 million, or 4 percent, to $20.2 billion, driven by run-off of acquired portfolios.
    • Commercial Banking average loans increased $731 million, or 1 percent, to $67.7 billion.
  • Period-end total deposits decreased $1.4 billion, or less than 1 percent, to $239.8 billion, while average deposits increased $2.0 billion, or less than 1 percent, to $240.6 billion.
  • Interest-bearing deposits rate paid increased 5 basis points to 0.71 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 July 20, 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 August 3, 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 $239.8 billion in deposits and $350.6 billion in total assets as of June 30, 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)
Second 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 June 30, 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 Q2 vs.

 

Six Months Ended June 30,

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

2017

2017

2016

2016

2016

2017

2016




2017 vs.

Q2

Q1

Q4

Q3

Q2

Q1

Q2

2017

2016

2016

Income Statement



















Net interest income

$

5,473

$

5,474

$

5,447

$

5,277

$

5,093

—

7

%

$

10,947

$

10,149

8

%

Non-interest income

1,231

1,061

1,119

1,184

1,161

16

%

6

2,292

2,325

(1)

Total net revenue(1)

6,704

6,535

6,566

6,461

6,254

3

7

13,239

12,474

6

Provision for credit losses

1,800

1,992

1,752

1,588

1,592

(10)

13

3,792

3,119

22

Non-interest expense:



















Marketing

435

396

575

393

415

10

5

831

843

(1)

Amortization of intangibles

61

62

101

89

95

(2)

(36)

123

196

(37)

Operating expenses

2,918

2,976

3,003

2,879

2,785

(2)

5

5,894

5,479

8

Total non-interest expense

3,414

3,434

3,679

3,361

3,295

(1)

4

6,848

6,518

5

Income from continuing operations before income taxes

1,490

1,109

1,135

1,512

1,367

34

9

2,599

2,837

(8)

Income tax provision

443

314

342

496

424

41

4

757

876

(14)

Income from continuing operations, net of tax

1,047

795

793

1,016

943

32

11

1,842

1,961

(6)

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

(11)

15

(2)

(11)

(1)

**

**

4

(6)

**

Net income

1,036

810

791

1,005

942

28

10

1,846

1,955

(6)

Dividends and undistributed earnings allocated to participating securities(3)

(8)

(5)

(6)

(6)

(6)

60

33

(13)

(12)

8

Preferred stock dividends

(80)

(53)

(75)

(37)

(65)

51

23

(133)

(102)

30

Net income available to common stockholders

$

948

$

752

$

710

$

962

$

871

26

9

$

1,700

$

1,841

(8)

Common Share Statistics



















Basic earnings per common share:(3)



















Net income from continuing operations

$

1.98

$

1.53

$

1.47

$

1.94

$

1.70

29

%

16

%

$

3.51

$

3.57

(2)%

Income (loss) from discontinued operations

(0.02)

0.03

—

(0.02)

—

**

**

0.01

(0.01)

**

Net income per basic common share

$

1.96

$

1.56

$

1.47

$

1.92

$

1.70

26

15

$

3.52

$

3.56

(1)

Diluted earnings per common share:(3)



















Net income from continuing operations

$

1.96

$

1.51

$

1.45

$

1.92

$

1.69

30

16

$

3.48

$

3.53

(1)

Income (loss) from discontinued operations

(0.02)

0.03

—

(0.02)

—

**

**

0.01

(0.01)

**

Net income per diluted common share

$

1.94

$

1.54

$

1.45

$

1.90

$

1.69

26

15

$

3.49

$

3.52

(1)

Weighted-average common shares outstanding (in millions):



















Basic

484.0

482.3

483.5

501.1

511.7

—

(5)

483.1

517.6

(7)

Diluted

488.1

487.9

489.2

505.9

516.5

—

(5)

487.7

522.3

(7)

Common shares outstanding (period-end, in millions)

483.7

482.8

480.2

489.2

505.9

—

(4)

483.7

505.9

(4)

Dividends 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)

60.94

58.66

57.76

59.00

57.84

4

5

60.94

57.84

5



























2017 Q2 vs.

Six Months Ended June 30,

(Dollars in millions)

2017

2017

2016

2016

2016

2017

2016




2017 vs.

Q2

Q1

Q4

Q3

Q2

Q1

Q2

2017

2016

2016

Balance Sheet (Period-End)



















Loans held for investment(5)

$

244,302

$

240,588

$

245,586

$

238,019

$

234,603

2

%

4

%

$

244,302

$

234,603

4

%

Interest-earning assets

319,286

316,712

321,807

313,431

307,163

1

4

319,286

307,163

4

Total assets

350,593

348,549

357,033

345,061

339,117

1

3

350,593

339,117

3

Interest-bearing deposits

213,810

214,818

211,266

200,416

195,635

—

9

213,810

195,635

9

Total deposits

239,763

241,182

236,768

225,981

221,059

(1)

8

239,763

221,059

8

Borrowings

49,954

48,439

60,460

59,820

59,181

3

(16)

49,954

59,181

(16)

Common equity

44,777

43,680

43,154

44,336

44,813

3

—

44,777

44,813

—

Total stockholders' equity

49,137

48,040

47,514

48,213

48,108

2

2

49,137

48,108

2

Balance Sheet (Average Balances)



















Loans held for investment(5)

$

242,241

$

241,505

$

240,027

$

235,843

$

230,379

—

5

%

$

241,875

$

228,557

6

%

Interest-earning assets

318,078

318,358

317,853

310,987

302,764

—

5

318,215

301,106

6

Total assets

349,891

351,641

350,225

343,153

334,479

—

5

350,761

333,197

5

Interest-bearing deposits

214,412

212,973

206,464

196,913

195,641

1

%

10

213,696

194,883

10

Total deposits

240,550

238,550

232,204

222,251

221,146

1

9

239,555

220,163

9

Borrowings

48,838

53,357

58,624

60,708

54,359

(8)

(10)

51,085

54,060

(6)

Common equity

44,645

43,833

43,921

45,314

45,640

2

(2)

44,241

45,711

(3)

Total stockholders' equity

49,005

48,193

47,972

49,033

48,934

2

—

48,602

49,007

(1)

 

 

CAPITAL ONE FINANCIAL CORPORATION (COF)
Table 2: Selected Metrics—Consolidated








































2017 Q2 vs.

Six Months Ended June 30,

(Dollars in millions, except as noted)

2017

2017

2016

2016

2016

2017

2016




2017 vs.

Q2

Q1

Q4

Q3

Q2

Q1

Q2

2017

2016

2016

Performance Metrics



















Net interest income growth (period over period)

—

—

3

%

4

%

1

%

**

**

8

%

11

%

**

Non-interest income growth (period over period)

16

%

(5)

%

(5)

2

—

**

**

(1)

5

**

Total net revenue growth (period over period)

3

—

2

3

1

**

**

6

10

**

Total net revenue margin(6)

8.43

8.21

8.26

8.31

8.26

22

bps

17

bps

8.32

8.29

3

bps

Net interest margin(7)

6.88

6.88

6.85

6.79

6.73

—

15

6.88

6.74

14

Return on average assets

1.20

0.90

0.91

1.18

1.13

30

7

1.05

1.18

(13)

Return on average tangible assets(8)

1.25

0.95

0.95

1.24

1.18

30

7

1.10

1.24

(14)

Return on average common equity(9)

8.59

6.73

6.48

8.59

7.64

186

95

7.67

8.08

(41)

Return on average tangible common equity(10)

13.09

10.37

10.00

13.06

11.61

272

148

11.75

12.28

(53)

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

5.64

5.69

6.13

5.70

5.72

(5)

(8)

5.66

5.70

(4)

Efficiency ratio(11)

50.92

52.55

56.03

52.02

52.69

(163)

(177)

51.73

52.25

(52)

Effective income tax rate for continuing operations

29.7

28.3

30.1

32.8

31.0

140

(130)

29.1

30.9

(180)

Employees (in thousands), period-end

49.9

48.4

47.3

46.5

46.1

3

%

8

%

49.9

46.1

8

%

Credit Quality Metrics



















Allowance for loan and lease losses

$

7,170

$

6,984

$

6,503

$

6,258

$

5,881

3

%

22

%

$

7,170

$

5,881

22

%

Allowance as a percentage of loans held for investment

2.93

%

2.90

%

2.65

%

2.63

%

2.51

%

3

bps

42

bps

2.93

%

2.51

%

42

bps

Net charge-offs

$

1,618

$

1,510

$

1,489

$

1,240

$

1,155

7

%

40

%

$

3,128

$

2,333

34

%

Net charge-off rate(12)

2.67

%

2.50

%

2.48

%

2.10

%

2.01

%

17

bps

66

bps

2.59

%

2.04

%

55

bps

30+ day performing delinquency rate

2.69

2.61

2.93

2.71

2.47

8

22

2.69

2.47

22

30+ day delinquency rate

2.99

2.92

3.27

3.04

2.79

7

20

2.99

2.79

20

Capital Ratios(13)



















Common equity Tier 1 capital

10.7

%

10.4

%

10.1

%

10.6

%

10.9

%

30

bps

(20)

bps

10.7

%

10.9

%

(20)

bps

Tier 1 capital

12.2

12.0

11.6

12.0

12.2

20

—

12.2

12.2

—

Total capital

14.9

14.7

14.3

14.7

14.4

20

50

14.9

14.4

50

Tier 1 leverage

10.3

9.9

9.9

10.1

10.2

40

10

10.3

10.2

10

Tangible common equity ("TCE")(14)

8.8

8.5

8.1

8.8

9.0

30

(20)

8.8

9.0

(20)

 

 

CAPITAL ONE FINANCIAL CORPORATION (COF)
Table 3: Consolidated Statements of Income








































2017 Q2 vs.

Six Months Ended June 30,


2017

2017

2016

2016

2016

2017

2016




2017 vs.

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

Q2

Q1

Q4

Q3

Q2

Q1

Q2

2017

2016

2016

Interest income:



















Loans, including loans held for sale

$

5,669

$

5,626

$

5,587

$

5,383

$

5,148

1

%

10

%

$

11,295

$

10,233

10

%

Investment securities

433

416

393

386

405

4

7

849

820

4

Other

26

28

29

25

18

(7)

44

54

35

54

Total interest income

6,128

6,070

6,009

5,794

5,571

1

10

12,198

11,088

10

Interest expense:



















Deposits

382

353

332

306

292

8

31

735

575

28

Securitized debt obligations

82

69

65

56

47

19

74

151

95

59

Senior and subordinated notes

179

149

138

121

111

20

61

328

217

51

Other borrowings

12

25

27

34

28

(52)

(57)

37

52

(29)

Total interest expense

655

596

562

517

478

10

37

1,251

939

33

Net interest income

5,473

5,474

5,447

5,277

5,093

—

7

10,947

10,149

8

Provision for credit losses

1,800

1,992

1,752

1,588

1,592

(10)

13

3,792

3,119

22

Net interest income after provision for credit losses

3,673

3,482

3,695

3,689

3,501

5

5

7,155

7,030

2

Non-interest income:(15)(16)



















Service charges and other customer-related fees

418

371

412

417

393

13

6

789

816

(3)

Interchange fees, net

676

570

624

603

621

19

9

1,246

1,225

2

Net securities gains (losses)

(4)

—

(4)

1

—

**

**

(4)

(8)

(50)

Other

141

120

87

163

147

18

(4)

261

292

(11)

Total non-interest income

1,231

1,061

1,119

1,184

1,161

16

6

2,292

2,325

(1)

Non-interest expense:(15)(16)



















Salaries and associate benefits

1,383

1,471

1,336

1,317

1,279

(6)

8

2,854

2,549

12

Occupancy and equipment

474

471

522

499

465

1

2

945

923

2

Marketing

435

396

575

393

415

10

5

831

843

(1)

Professional services

279

247

312

257

264

13

6

526

505

4

Communications and data processing

289

288

297

291

302

—

(4)

577

582

(1)

Amortization of intangibles

61

62

101

89

95

(2)

(36)

123

196

(37)

Other

493

499

536

515

475

(1)

4

992

920

8

Total non-interest expense

3,414

3,434

3,679

3,361

3,295

(1)

4

6,848

6,518

5

Income from continuing operations before income taxes

1,490

1,109

1,135

1,512

1,367

34

9

2,599

2,837

(8)

Income tax provision

443

314

342

496

424

41

4

757

876

(14)

Income from continuing operations, net of tax

1,047

795

793

1,016

943

32

11

1,842

1,961

(6)

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

(11)

15

(2)

(11)

(1)

**

**

4

(6)

**

Net income

1,036

810

791

1,005

942

28

10

1,846

1,955

(6)

Dividends and undistributed earnings allocated to participating securities(3)

(8)

(5)

(6)

(6)

(6)

60

33

(13)

(12)

8

Preferred stock dividends

(80)

(53)

(75)

(37)

(65)

51

23

(133)

(102)

30

Net income available to common stockholders

$

948

$

752

$

710

$

962

$

871

26

9

$

1,700

$

1,841

(8)

































2017 Q2 vs.

Six Months Ended June 30,


2017

2017

2016

2016

2016

2017

2016




2017 vs.

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

Q2

Q1

Q4

Q3

Q2

Q1

Q2

2017

2016

2016

Basic earnings per common share:(3)



















Net income from continuing operations

$

1.98

$

1.53

$

1.47

$

1.94

$

1.70

29

%

16

%

$

3.51

$

3.57

(2)

%

Income (loss) from discontinued operations

(0.02)

0.03

—

(0.02)

—

**

**

0.01

(0.01)

**

Net income per basic common share

$

1.96

$

1.56

$

1.47

$

1.92

$

1.70

26

15

$

3.52

$

3.56

(1)

Diluted earnings per common share:(3)



















Net income from continuing operations

$

1.96

$

1.51

$

1.45

$

1.92

$

1.69

30

16

$

3.48

$

3.53

(1)

Income (loss) from discontinued operations

(0.02)

0.03

—

(0.02)

—

**

**

0.01

(0.01)

**

Net income per diluted common share

$

1.94

$

1.54

$

1.45

$

1.90

$

1.69

26

15

$

3.49

$

3.52

(1)

Weighted-average common shares outstanding (in millions):



















Basic common shares

484.0

482.3

483.5

501.1

511.7

—

(5)

483.1

517.6

(7)

Diluted common shares

488.1

487.9

489.2

505.9

516.5

—

(5)

487.7

522.3

(7)

Dividends paid per common share

$

0.40

$

0.40

$

0.40

$

0.40

$

0.40

—

—

$

0.80

$

0.80

—

 

 

CAPITAL ONE FINANCIAL CORPORATION (COF)
Table 4: Consolidated Balance Sheets




































2017 Q2 vs.


2017

2017

2016

2016

2016

2017

2016

(Dollars in millions)

Q2

Q1

Q4

Q3

Q2

Q1

Q2

Assets:













Cash and cash equivalents:













Cash and due from banks

$

3,352

$

3,489

$

4,185

$

3,350

$

3,253

(4)

%

3

%

Interest-bearing deposits and other short-term investments

3,363

5,826

5,791

5,744

3,896

(42)

(14)

Total cash and cash equivalents

6,715

9,315

9,976

9,094

7,149

(28)

(6)

Restricted cash for securitization investors

300

486

2,517

287

265

(38)

13

Securities available for sale, at fair value

41,120

41,260

40,737

41,511

39,960

—

3

Securities held to maturity, at carrying value

27,720

26,170

25,712

25,019

25,120

6

10

Loans held for investment:(5)













Unsecuritized loans held for investment

214,864

211,038

213,824

206,763

202,778

2

6

Loans held in consolidated trusts

29,438

29,550

31,762

31,256

31,825

—

(8)

Total loans held for investment

244,302

240,588

245,586

238,019

234,603

2

4

Allowance for loan and lease losses

(7,170)

(6,984)

(6,503)

(6,258)

(5,881)

3

22

Net loans held for investment

237,132

233,604

239,083

231,761

228,722

2

4

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

777

735

1,043

994

1,220

6

(36)

Premises and equipment, net

3,825

3,727

3,675

3,561

3,556

3

8

Interest receivable

1,346

1,368

1,351

1,251

1,236

(2)

9

Goodwill

14,524

14,521

14,519

14,493

14,495

—

—

Other assets

17,134

17,363

18,420

17,090

17,394

(1)

(1)

Total assets

$

350,593

$

348,549

$

357,033

$

345,061

$

339,117

1

3



























2017 Q2 vs.


2017

2017

2016

2016

2016

2017

2016

(Dollars in millions)

Q2

Q1

Q4

Q3

Q2

Q1

Q2

Liabilities:













Interest payable

$

376

$

260

$

327

$

237

$

301

45

%

25

%

Deposits:













Non-interest-bearing deposits

25,953

26,364

25,502

25,565

25,424

(2)

2

Interest-bearing deposits

213,810

214,818

211,266

200,416

195,635

—

9

Total deposits

239,763

241,182

236,768

225,981

221,059

(1)

8

Securitized debt obligations

18,358

18,528

18,826

18,411

16,130

(1)

14

Other debt:













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

958

1,046

992

1,079

999

(8)

(4)

Senior and subordinated notes

28,478

26,405

23,431

24,001

21,872

8

30

Other borrowings

2,160

2,460

17,211

16,329

20,180

(12)

(89)

Total other debt

31,596

29,911

41,634

41,409

43,051

6

(27)

Other liabilities

11,363

10,628

11,964

10,810

10,468

7

9

Total liabilities

301,456

300,509

309,519

296,848

291,009

—

4















Stockholders' equity:













Preferred stock

0

0

0

0

0

—

—

Common stock

7

7

7

7

7

—

—

Additional paid-in capital, net

31,413

31,326

31,157

30,439

29,786

—

5

Retained earnings

31,086

30,326

29,766

29,245

28,479

3

9

Accumulated other comprehensive income (loss)

(683)

(934)

(949)

121

241

(27)

                 **

Treasury stock, at cost

(12,686)

(12,685)

(12,467)

(11,599)

(10,405)

—

22

Total stockholders' equity

49,137

48,040

47,514

48,213

48,108

2

2

Total liabilities and stockholders' equity

$

350,593

$

348,549

$

357,033

$

345,061

$

339,117

1

3

 

 

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 $313 million in Q2 2017, $321 million in both Q1 2017 and Q4 2016, $289 million in Q3 2016 and $244 million in Q2 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

2017

2016

2016

2016

(Dollars in millions)

Q2

Q1

Q4

Q3

Q2

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









Recorded in continuing operations

$

—

$

(25)

$

—

$

—

$

(1)

Recorded in discontinued operations

6

(67)

(2)

18

2

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

$

6

$

(92)

$

(2)

$

18

$

1











         The mortgage representation and warranty reserve was $521 million as of June 30, 2017, $516 million as of March 31, 2017, $630 million as of December 31, 2016, $632 million as of September 30, 2016 and $614 

         million as of June 30, 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

2017

2016

2016

2016

(Dollars in millions)

Q2

Q1

Q4

Q3

Q2

PCI loans:









Period-end unpaid principal balance

$

13,599

$

14,838

$

15,896

$

17,011

$

18,256

Period-end loans held for investment

12,895

14,102

15,071

16,149

17,358

Average loans held for investment

13,305

14,433

15,443

16,529

17,783

(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 Q2 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 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 Q2 2016 and the six months ended June 30, 2016, compared to previously reported results were (i) an increase to Service charges and

         other customer-related fees of $22 million and $41 million, respectively; (ii) a decrease to Other non-interest income of $29 million and $56 million, respectively; and (iii) increases to Communications and data processing

         expense of $40 million and $77 million, respectively, with corresponding decreases to Professional services.

**      Not meaningful.

 

 

CAPITAL ONE FINANCIAL CORPORATION (COF)
Table 6: Average Balances, Net Interest Income and Net Interest Margin


2017 Q2

2017 Q1

2016 Q2


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

$

242,967

$

5,669

9.33

%

$

242,249

$

5,626

9.29

%

$

231,496

$

5,148

8.90

%

Investment securities

68,857

433

2.52

68,418

416

2.43

65,754

405

2.46

Cash equivalents and other

6,254

26

1.66

7,691

28

1.46

5,514

18

1.31

Total interest-earning assets

$

318,078

$

6,128

7.71

$

318,358

$

6,070

7.63

$

302,764

$

5,571

7.36

Interest-bearing liabilities:

















Interest-bearing deposits

$

214,412

$

382

0.71

$

212,973

$

353

0.66

$

195,641

$

292

0.60

Securitized debt obligations

18,400

82

1.78

17,176

69

1.61

15,226

47

1.23

Senior and subordinated notes

27,821

179

2.57

24,804

149

2.40

21,717

111

2.04

Other borrowings and liabilities

3,656

12

1.31

12,356

25

0.81

18,255

28

0.61

Total interest-bearing liabilities

$

264,289

$

655

0.99

$

267,309

$

596

0.89

$

250,839

$

478

0.76

Net interest income/spread


$

5,473

6.72



$

5,474

6.74



$

5,093

6.60

Impact of non-interest-bearing funding




0.16





0.14





0.13

Net interest margin




6.88

%




6.88

%




6.73

%

 

Six Months Ended June 30,


2017

2016


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

$

242,610

$

11,295

9.31

%

$

229,534

$

10,233

8.92

%

Investment securities

68,637

849

2.47

65,455

820

2.51

Cash equivalents and other

6,968

54

1.55

6,117

35

1.14

Total interest-earning assets

$

318,215

$

12,198

7.67

$

301,106

$

11,088

7.36

Interest-bearing liabilities:











Interest-bearing deposits

$

213,696

$

735

0.69

$

194,883

$

575

0.59

Securitized debt obligations

17,791

151

1.70

15,293

95

1.24

Senior and subordinated notes

26,321

328

2.49

21,855

217

1.99

Other borrowings and liabilities

7,981

37

0.93

17,716

52

0.59

Total interest-bearing liabilities

$

265,789

$

1,251

0.94

$

249,747

$

939

0.75

Net interest income/spread


$

10,947

6.73



$

10,149

6.61

Impact of non-interest-bearing funding




0.15





0.13

Net interest margin




6.88

%




6.74

%

__________

(1)    Interest income and interest expense and the calculation of average yields on interest-earning assets and average rates on interest-bearing liabilities include the impact of hedge accounting.

 

 

CAPITAL ONE FINANCIAL CORPORATION (COF)
Table 7: Loan Information and Performance Statistics             

































2017 Q2 vs.

Six Months Ended June 30,

 

(Dollars in millions, except as noted)

2017
Q2

2017
Q1

2016
Q4

2016
Q3

2016
Q2

2017
Q1

2016
Q2

2017

2016

2017 vs.
2016

Loans Held For Investment (Period-End)



















Credit card:



















   Domestic credit card

$

92,866

$

91,092

$

97,120

$

90,955

$

88,581

2

%

5

%

$

92,866

$

88,581

5

%

   International card businesses

8,724

8,121

8,432

8,246

8,323

7

5

8,724

8,323

5

Total credit card

101,590

99,213

105,552

99,201

96,904

2

5

101,590

96,904

5

Consumer banking:



















   Auto

51,765

49,771

47,916

46,311

44,502

4

16

51,765

44,502

16

   Home loan

19,724

20,738

21,584

22,448

23,358

(5)

(16)

19,724

23,358

(16)

   Retail banking

3,484

3,473

3,554

3,526

3,555

—

(2)

3,484

3,555

(2)

Total consumer banking

74,973

73,982

73,054

72,285

71,415

1

5

74,973

71,415

5

Commercial banking:



















   Commercial and multifamily real estate

27,428

27,218

26,609

26,507

26,341

1

4

27,428

26,341

4

   Commercial and industrial

39,801

39,638

39,824

39,432

39,313

—

1

39,801

39,313

1

Total commercial lending

67,229

66,856

66,433

65,939

65,654

1

2

67,229

65,654

2

   Small-ticket commercial real estate

443

464

483

518

548

(5)

(19)

443

548

(19)

Total commercial banking

67,672

67,320

66,916

66,457

66,202

1

2

67,672

66,202

2

Other loans

67

73

64

76

82

(8)

(18)

67

82

(18)

Total loans held for investment

$

244,302

$

240,588

$

245,586

$

238,019

$

234,603

2

4

$

244,302

$

234,603

4

Loans Held For Investment (Average)



















Credit card:



















   Domestic credit card

$

91,769

$

93,034

$

92,623

$

89,763

$

85,981

(1)%

7

%

$

92,398

$

85,564

8

%

   International card businesses

8,274

8,135

8,168

8,253

8,401

2

(2)

8,205

8,120

1

Total credit card

100,043

101,169

100,791

98,016

94,382

(1)

6

100,603

93,684

7

Consumer banking:



















   Auto

50,803

48,673

47,126

45,355

43,605

4

17

49,743

42,784

16

   Home loan

20,203

21,149

21,984

22,852

23,835

(4)

(15)

20,674

24,308

(15)

   Retail banking

3,463

3,509

3,549

3,520

3,548

(1)

(2)

3,486

3,550

(2)

Total consumer banking

74,469

73,331

72,659

71,727

70,988

2

5

73,903

70,642

5

Commercial banking:



















   Commercial and multifamily real estate

27,401

26,587

26,445

26,154

25,661

3

7

26,997

25,338

7

   Commercial and industrial

39,815

39,877

39,573

39,346

38,713

—

3

39,845

38,237

4

Total commercial lending

67,216

66,464

66,018

65,500

64,374

1

4

66,842

63,575

5

   Small-ticket commercial real estate

453

474

497

534

564

(4)

(20)

463

581

(20)

Total commercial banking

67,669

66,938

66,515

66,034

64,938

1

4

67,305

64,156

5

Other loans

60

67

62

66

71

(10)

(15)

64

75

(15)

Total average loans held for investment

$

242,241

$

241,505

$

240,027

$

235,843

$

230,379

—

5

$

241,875

$

228,557

6













2017 Q2 vs.

Six Months Ended June 30,


2017
Q2

2017
Q1

2016
Q4

2016
Q3

2016
Q2

2017
Q1

2016
Q2

2017

2016

2017 vs.
2016

Net Charge-Off (Recovery) Rates



















Credit card:



















   Domestic credit card

5.11

%

5.14

%

4.66

%

3.74

%

4.07

%

(3)

bps

104

bps

5.12

%

4.12

%

100

bps

   International card businesses

4.08

3.69

3.35

3.18

3.54

39

54

3.88

3.39

49

Total credit card

5.02

5.02

4.56

3.70

4.02

—

100

5.02

4.05

97

Consumer banking:



















   Auto(1)

1.70

1.64

2.07

1.85

1.20

6

50

1.67

1.39

28

   Home loan

0.04

0.03

0.08

0.03

0.09

1

(5)

0.03

0.07

(4)

   Retail banking

1.71

1.92

1.73

1.75

1.26

(21)

45

1.81

1.31

50

Total consumer banking(1)

1.25

1.19

1.45

1.26

0.83

6

42

1.22

0.93

29

Commercial banking:



















   Commercial and multifamily real estate

0.03

—

(0.02)

0.01

(0.02)

**

**

0.02

(0.02)

**

   Commercial and industrial

1.34

0.22

0.80

1.09

0.62

112

72

0.78

0.56

22

Total commercial lending

0.81

0.13

0.47

0.66

0.37

68

44

0.47

0.33

14

   Small-ticket commercial real estate

(0.22)

1.05

(0.02)

0.74

0.33

**

**

0.43

0.23

20

Total commercial banking

0.80

0.14

0.47

0.66

0.37

66

43

0.47

0.33

14

Total net charge-offs

2.67

2.50

2.48

2.10

2.01

17

66

2.59

2.04

55

30+ Day Performing Delinquency Rates



















Credit card:



















   Domestic credit card

3.63

%

3.71

%

3.95

%

3.68

%

3.14

%

(8)

bps

49

bps

3.63

%

3.14

%

49

bps

   International card businesses

3.28

3.39

3.36

3.33

3.24

(11)

4

3.28

3.24

4

Total credit card

3.60

3.68

3.91

3.65

3.15

(8)

45

3.60

3.15

45

Consumer banking:



















   Auto

5.40

5.03

6.12

5.67

5.59

37

(19)

5.40

5.59

(19)

   Home loan

0.14

0.15

0.20

0.19

0.14

(1)

—

0.14

0.14

—

   Retail banking

0.54

0.59

0.70

0.59

0.62

(5)

(8)

0.54

0.62

(8)

Total consumer banking

3.79

3.45

4.10

3.72

3.56

34

23

3.79

3.56

23

Nonperforming Loans and Nonperforming Assets Rates(2)(3) 



















Credit card:



















   International card businesses

0.37

%

0.47

%

0.50

%

0.53

%

0.53

%

(10)

bps

(16)

bps

0.37

%

0.53

%

(16)

bps

Total credit card

0.03

0.04

0.04

0.04

0.05

(1)

(2)

0.03

0.05

(2)

Consumer banking:



















   Auto

0.53

0.36

0.47

0.43

0.38

17

15

0.53

0.38

15

   Home loan

1.31

1.27

1.26

1.23

1.24

4

7

1.31

1.24

7

   Retail banking

0.96

0.82

0.86

1.05

0.89

14

7

0.96

0.89

7

Total consumer banking

0.75

0.64

0.72

0.71

0.69

11

6

0.75

0.69

6

Commercial banking:



















   Commercial and multifamily real estate

0.13

0.13

0.11

0.08

0.10

—

3

0.13

0.10

3

   Commercial and industrial

1.62

2.02

2.48

2.44

2.58

(40)

(96)

1.62

2.58

(96)

Total commercial lending

1.01

1.25

1.53

1.49

1.59

(24)

(58)

1.01

1.59

(58)

   Small-ticket commercial real estate

1.89

1.65

0.85

2.13

1.59

24

30

1.89

1.59

30

Total commercial banking

1.01

1.25

1.53

1.50

1.59

(24)

(58)

1.01

1.59

(58)

Total nonperforming loans

0.53

0.57

0.65

0.66

0.68

(4)

(15)

0.53

0.68

(15)

Total nonperforming assets

0.60

0.66

0.76

0.77

0.80

(6)

(20)

0.60

0.80

(20)

CAPITAL ONE FINANCIAL CORPORATION (COF)
Table 8: Allowance for Loan and Lease Losses and Reserve for Unfunded Lending Commitments Activity





Three Months Ended June 30, 2017


Credit Card

Consumer Banking





(Dollars in millions)

Domestic Card

International Card Businesses

Total Credit Card

Auto

Home
Loan

Retail
Banking

Total
Consumer
Banking

Commercial Banking

Other(4)

Total

Allowance for loan and lease losses:



















Balance as of March 31, 2017

$

4,670

$

388

$

5,058

$

1,028

$

60

$

75

$

1,163

$

761

$

2

$

6,984

Charge-offs

(1,454)

(118)

(1,572)

(369)

(3)

(18)

(390)

(140)

—

(2,102)

Recoveries

282

34

316

154

1

3

158

4

6

484

Net charge-offs

(1,172)

(84)

(1,256)

(215)

(2)

(15)

(232)

(136)

6

(1,618)

Provision (benefit) for loan and lease losses

1,327

70

1,397

253

1

14

268

141

(5)

1,801

Allowance build (release) for loan and lease losses

155

(14)

141

38

(1)

(1)

36

5

1

183

Other changes(5)

—

11

11

—

—

—

—

(8)

—

3

Balance as of June 30, 2017

4,825

385

5,210

1,066

59

74

1,199

758

3

7,170

Reserve for unfunded lending commitments:



















Balance as of March 31, 2017

—

—

—

—

—

7

7

133

—

140

Benefit for losses on unfunded lending commitments

—

—

—

—

—

—

—

(1)

—

(1)

Balance as of June 30, 2017

—

—

—

—

—

7

7

132

—

139

Combined allowance and reserve as of June 30, 2017                                              


$

4,825

$

385

$

5,210

$

1,066

$

59

$

81

$

1,206

$

890

$

3

$

7,309








Six Months Ended June 30, 2017


Credit Card

Consumer Banking





(Dollars in millions)

Domestic Card

International Card Businesses

Total Credit Card

Auto

Home
Loan

Retail
Banking

Total
Consumer
Banking

Commercial Banking

Other(4)

Total

Allowance for loan and lease losses:



















Balance as of December 31, 2016

$

4,229

$

377

$

4,606

$

957

$

65

$

80

$

1,102

$

793

$

2

$

6,503

Charge-offs

(2,938)

(235)

(3,173)

(708)

(7)

(39)

(754)

(166)

—

(4,093)

Recoveries

570

76

646

294

3

7

304

7

8

965

Net charge-offs

(2,368)

(159)

(2,527)

(414)

(4)

(32)

(450)

(159)

8

(3,128)

Provision (benefit) for loan and lease losses

2,964

150

3,114

523

(2)

26

547

135

(7)

3,789

Allowance build (release) for loan and lease losses

596

(9)

587

109

(6)

(6)

97

(24)

1

661

Other changes(5)

—

17

17

—

—

—

—

(11)

—

6

Balance as of June 30, 2017

4,825

385

5,210

1,066

59

74

1,199

758

3

7,170

Reserve for unfunded lending commitments:



















Balance as of December 31, 2016

—

—

—

—

—

7

7

129

—

136

Provision for losses on unfunded lending commitments

—

—

—

—

—

—

—

3

—

3

Balance as of June 30, 2017

—

—

—

—

—

7

7

132

—

139

Combined allowance and reserve as of June 30, 2017

$

4,825

$

385

$

5,210

$

1,066

$

59

$

81

$

1,206

$

890

$

3

$

7,309

 

 

CAPITAL ONE FINANCIAL CORPORATION (COF)
Table 9: Financial Summary—Business Segment Results










Three Months Ended June 30, 2017

Six Months Ended June 30, 2017

(Dollars in millions)

Credit Card

Consumer Banking

Commercial Banking

Other

Total

Credit Card

Consumer Banking

Commercial Banking

Other

Total

Net interest income

$

3,294

$

1,578

$

569

$

32

$

5,473

$

6,640

$

3,095

$

1,135

$

77

$

10,947

Non-interest income

875

183

183

(10)

1,231

1,613

378

341

(40)

2,292

Total net revenue(6)

4,169

1,761

752

22

6,704

8,253

3,473

1,476

37

13,239

Provision (benefit) for credit losses

1,397

268

140

(5)

1,800

3,114

547

138

(7)

3,792

Non-interest expense

1,918

1,059

381

56

3,414

3,847

2,101

772

128

6,848

Income (loss) from continuing operations before income taxes

854

434

231

(29)

1,490

1,292

825

566

(84)

2,599

Income tax provision (benefit)

301

158

85

(101)

443

468

301

207

(219)

757

Income from continuing operations, net of tax

$

553

$

276

$

146

$

72

$

1,047

$

824

$

524

$

359

$

135

$

1,842























Three Months Ended March 31, 2017









(Dollars in millions)

Credit Card

Consumer Banking

Commercial Banking

Other

Total









Net interest income

$

3,346

$

1,517

$

566

$

45

$

5,474










Non-interest income

738

195

158

(30)

1,061










Total net revenue(6)

4,084

1,712

724

15

6,535










Provision (benefit) for credit losses

1,717

279

(2)

(2)

1,992










Non-interest expense

1,929

1,042

391

72

3,434










Income (loss) from continuing operations before income taxes

438

391

335

(55)

1,109










Income tax provision (benefit)

167

143

122

(118)

314










Income from continuing operations, net of tax

$

271

$

248

$

213

$

63

$

795

































Three Months Ended June 30, 2016

Six Months Ended June 30, 2016

(Dollars in millions)

Credit Card

Consumer Banking

Commercial Banking

Other

Total

Credit Card

Consumer Banking

Commercial Banking

Other

Total

Net interest income

$

3,045

$

1,439

$

559

$

50

$

5,093

$

6,078

$

2,859

$

1,096

$

116

$

10,149

Non-interest income

859

175

129

(2)

1,161

1,706

366

247

6

2,325

Total net revenue(6)

3,904

1,614

688

48

6,254

7,784

3,225

1,343

122

12,474

Provision (benefit) for credit losses

1,261

204

128

(1)

1,592

2,332

434

356

(3)

3,119

Non-interest expense

1,883

1,006

343

63

3,295

3,746

1,996

665

111

6,518

Income (loss) from continuing operations before income taxes

760

404

217

(14)

1,367

1,706

795

322

14

2,837

Income tax provision (benefit)

276

147

79

(78)

424

613

289

117

(143)

876

Income from continuing operations, net of tax

$

484

$

257

$

138

$

64

$

943

$

1,093

$

506

$

205

$

157

$

1,961





















 

 

CAPITAL ONE FINANCIAL CORPORATION (COF)
Table 10: Financial & Statistical Summary—Credit Card Business








































2017 Q2 vs.

Six Months Ended June 30,


2017

2017

2016

2016

2016

2017

2016




2017 vs.

(Dollars in millions, except as noted)

Q2

Q1

Q4

Q3

Q2

Q1

Q2

2017

2016

2016

Credit Card



















Earnings:



















Net interest income

$

3,294

$

3,346

$

3,353

$

3,204

$

3,045

(2)%

8

%

$

6,640

$

6,078

9

%

Non-interest income

875

738

849

825

859

19

2

1,613

1,706

(5)

Total net revenue

4,169

4,084

4,202

4,029

3,904

2

7

8,253

7,784

6

Provision for credit losses

1,397

1,717

1,322

1,272

1,261

(19)

11

3,114

2,332

34

Non-interest expense

1,918

1,929

2,073

1,884

1,883

(1)

2

3,847

3,746

3

Income from continuing operations before income taxes

854

438

807

873

760

95

12

1,292

1,706

(24)

Income tax provision

301

167

295

318

276

80

9

468

613

(24)

Income from continuing operations, net of tax

$

553

$

271

$

512

$

555

$

484

104

14

$

824

$

1,093

(25)

Selected performance metrics:



















Period-end loans held for investment

$

101,590

$

99,213

$

105,552

$

99,201

$

96,904

2

5

$

101,590

$

96,904

5

Average loans held for investment

100,043

101,169

100,791

98,016

94,382

(1)

6

100,603

93,684

7

Average yield on loans held for investment(7)

15.14

%

14.99

%

14.93

%

14.68

%

14.49

%

15

bps

65

bps

15.06

%

14.55

%

51

bps

Total net revenue margin(8)

16.67

16.14

16.68

16.44

16.55

53

12

16.41

16.62

(21)

Net charge-off rate

5.02

5.02

4.56

3.70

4.02

—

100

5.02

4.05

97

30+ day performing delinquency rate

3.60

3.68

3.91

3.65

3.15

(8)

45

3.60

3.15

45

30+ day delinquency rate

3.62

3.71

3.94

3.69

3.18

(9)

44

3.62

3.18

44

Nonperforming loan rate(2)

0.03

0.04

0.04

0.04

0.05

(1)

(2)

0.03

0.05

(2)

PCCR intangible amortization

$

44

$

44

$

58

$

62

$

67

—

(34)%

$

88

$

137

(36)%

Purchase volume(9)

83,079

73,197

82,824

78,106

78,019

14

%

6

156,276

146,208

7

































2017 Q2 vs.

Six Months Ended June 30,


2017

2017

2016

2016

2016

2017

2016




2017 vs.

(Dollars in millions, except as noted)

Q2

Q1

Q4

Q3

Q2

Q1

Q2

2017

2016

2016

Domestic Card



















Earnings:



















Net interest income

$

3,011

$

3,093

$

3,090

$

2,956

$

2,769

(3)%

9

%

$

6,104

$

5,525

10

%

Non-interest income

802

699

791

759

792

15

1

1,501

1,566

(4)

Total net revenue

3,813

3,792

3,881

3,715

3,561

1

7

7,605

7,091

7

Provision for credit losses

1,327

1,637

1,229

1,190

1,164

(19)

14

2,964

2,136

39

Non-interest expense

1,727

1,717

1,859

1,696

1,669

1

3

3,444

3,340

3

Income from continuing operations before income taxes

759

438

793

829

728

73

4

1,197

1,615

(26)

Income tax provision

277

160

288

302

265

73

5

437

588

(26)

Income from continuing operations, net of tax

$

482

$

278

$

505

$

527

$

463

73

4

$

760

$

1,027

(26)

Selected performance metrics:



















Period-end loans held for investment

$

92,866

$

91,092

$

97,120

$

90,955

$

88,581

2

5

$

92,866

$

88,581

5

Average loans held for investment

91,769

93,034

92,623

89,763

85,981

(1)

7

92,398

85,564

8

Average yield on loans held for investment(7)

15.07

%

15.01

%

14.91

%

14.71

%

14.40

%

6

bps

67

bps

15.04

%

14.41

%

63

bps

Total net revenue margin(8)

16.62

16.30

16.76

16.55

16.57

32

5

16.46

16.58

(12)

Net charge-off rate

5.11

5.14

4.66

3.74

4.07

(3)

104

5.12

4.12

100

30+ day delinquency rate

3.63

3.71

3.95

3.68

3.14

(8)

49

3.63

3.14

49

Purchase volume(9)

$

75,781

$

66,950

$

75,639

$

71,331

$

71,050

13

%

7

%

$

142,731

$

133,667

7

%

Refreshed FICO scores:(10)



















Greater than 660

64

%

63

%

64

%

64

%

65

%

1

(1)

64

%

65

%

(1)

660 or below

36

37

36

36

35

(1)

1

36

35

1

Total

100

%

100

%

100

%

100

%

100

%




100

%

100

%























 

 

CAPITAL ONE FINANCIAL CORPORATION (COF)
Table 11: Financial & Statistical Summary—Consumer Banking Business








































2017 Q2 vs.

Six Months Ended June 30,


2017

2017

2016

2016

2016

2017

2016




2017 vs.

(Dollars in millions, except as noted)

Q2

Q1

Q4

Q3

Q2

Q1

Q2

2017

2016

2016

Consumer Banking



















Earnings:



















Net interest income

$

1,578

$

1,517

$

1,498

$

1,472

$

1,439

4

%

10

%

$

3,095

$

2,859

8

%

Non-interest income

183

195

166

201

175

(6)

5

378

366

3

Total net revenue

1,761

1,712

1,664

1,673

1,614

3

9

3,473

3,225

8

Provision for credit losses

268

279

365

256

204

(4)

31

547

434

26

Non-interest expense

1,059

1,042

1,109

1,034

1,006

2

5

2,101

1,996

5

Income from continuing operations before income taxes

434

391

190

383

404

11

7

825

795

4

Income tax provision

158

143

70

139

147

10

7

301

289

4

Income from continuing operations, net of tax

$

276

$

248

$

120

$

244

$

257

11

7

$

524

$

506

4

Selected performance metrics:



















Period-end loans held for investment

$

74,973

$

73,982

$

73,054

$

72,285

$

71,415

1

5

$

74,973

$

71,415

5

Average loans held for investment

74,469

73,331

72,659

71,727

70,988

2

5

73,903

70,642

5

Average yield on loans held for investment(7)

6.56

%

6.48

%

6.50

%

6.41

%

6.28

%

8

bps

28

bps

6.52

%

6.23

%

29

bps

Auto loan originations

$

7,453

$

7,025

$

6,542

$

6,804

$

6,529

6

%

14

%

$

14,478

$

12,373

17

%

Period-end deposits

186,607

188,216

181,917

178,793

176,340

(1)

6

186,607

176,340

6

Average deposits

186,989

183,936

180,019

177,402

176,808

2

6

185,471

175,531

6

Average deposits interest rate

0.59

%

0.57

%

0.57

%

0.56

%

0.55

%

2

bps

4

bps

0.58

%

0.54

%

4

bps

Net charge-off rate(1)

1.25

1.19

1.45

1.26

0.83

6

42

1.22

0.93

29

30+ day performing delinquency rate

3.79

3.45

4.10

3.72

3.56

34

23

3.79

3.56

23

30+ day delinquency rate

4.33

3.93

4.67

4.26

4.07

40

26

4.33

4.07

26

Nonperforming loan rate(2)

0.75

0.64

0.72

0.71

0.69

11

6

0.75

0.69

6

Nonperforming asset rate(3)

0.96

0.92

1.09

0.98

0.96

4

—

0.96

0.96

—

Auto—At origination FICO scores:(11)



















Greater than 660

51

%

51

%

52

%

51

%

51

%

—

—

51

%

51

%

—

621 - 660

18

18

17

17

17

—

1

%

18

17

1

%

620 or below

31

31

31

32

32

—

(1)

31

32

(1)

Total

100

%

100

%

100

%

100

%

100

%




100

%

100

%

 

 

CAPITAL ONE FINANCIAL CORPORATION (COF)
Table 12: Financial & Statistical Summary—Commercial Banking Business








































2017 Q2 vs.

Six Months Ended June 30,


2017

2017

2016

2016

2016

2017

2016




2017 vs.

(Dollars in millions, except as noted)

Q2

Q1

Q4

Q3

Q2

Q1

Q2

2017

2016

2016

Commercial Banking



















Earnings:



















Net interest income

$

569

$

566

$

565

$

555

$

559

1

%

2

%

$

1,135

$

1,096

4

%

Non-interest income

183

158

175

156

129

16

42

341

247

38

Total net revenue(6)

752

724

740

711

688

4

9

1,476

1,343

10

Provision (benefit) for credit losses

140

(2)

66

61

128

**

9

138

356

(61)

Non-interest expense

381

391

393

349

343

(3)

11

772

665

16

Income from continuing operations before income taxes

231

335

281

301

217

(31)

6

566

322

76

Income tax provision

85

122

102

110

79

(30)

8

207

117

77

Income from continuing operations, net of tax

$

146

$

213

$

179

$

191

$

138

(31)

6

$

359

$

205

75

Selected performance metrics:



















Period-end loans held for investment

$

67,672

$

67,320

$

66,916

$

66,457

$

66,202

1

2

$

67,672

$

66,202

2

Average loans held for investment

67,669

66,938

66,515

66,034

64,938

1

4

67,305

64,156

5

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

3.81

%

3.65

%

3.55

%

3.50

%

3.45

%

16

bps

36

bps

3.73

%

3.42

%

31

bps

Period-end deposits

$

33,153

$

33,735

$

33,866

$

33,611

$

34,281

(2)

%

(3)

%

$

33,153

$

34,281

(3)

%

Average deposits

34,263

34,219

34,029

33,498

33,764

—

1

34,241

33,920

1

Average deposits interest rate

0.36

%

0.31

%

0.30

%

0.30

%

0.27

%

5

bps

9

bps

0.34

%

0.27

%

7

bps

Net charge-off rate

0.80

0.14

0.47

0.66

0.37

66

43

0.47

0.33

14

Nonperforming loan rate(2)

1.01

1.25

1.53

1.50

1.59

(24)

(58)

1.01

1.59

(58)

Nonperforming asset rate(3)

1.04

1.27

1.54

1.51

1.60

(23)

(56)

1.04

1.60

(56)

Risk category:(12)



















Noncriticized

$

63,802

$

63,390

$

62,828

$

62,336

$

61,926

1

%

3

%

$

63,802

$

61,926

3

%

Criticized performing

2,660

2,492

2,453

2,473

2,456

7

8

2,660

2,456

8

Criticized nonperforming

686

844

1,022

994

1,050

(19)

(35)

686

1,050

(35)

PCI loans

524

594

613

654

770

(12)

(32)

524

770

(32)

Total commercial loans

$

67,672

$

67,320

$

66,916

$

66,457

$

66,202

1

2

$

67,672

$

66,202

2

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



















Noncriticized

94.3

%

94.2

%

93.9

%

93.8

%

93.5

%

10

bps

80

bps

94.3

%

93.5

%

80

bps

Criticized performing

3.9

3.7

3.7

3.7

3.7

20

20

3.9

3.7

20

Criticized nonperforming

1.0

1.2

1.5

1.5

1.6

(20)

(60)

1.0

1.6

(60)

PCI loans

0.8

0.9

0.9

1.0

1.2

(10)

(40)

0.8

1.2

(40)

Total commercial loans

100.0

%

100.0

%

100.0

%

100.0

%

100.0

%




100.0

%

100.0

%


 

 

CAPITAL ONE FINANCIAL CORPORATION (COF)
Table 13: Financial & Statistical Summary—Other and Total








































2017 Q2 vs.

Six Months Ended June 30,


2017

2017

2016

2016

2016

2017

2016




2017 vs.

(Dollars in millions)

Q2

Q1

Q4

Q3

Q2

Q1

Q2

2017

2016

2016

Other



















Earnings:



















Net interest income

$

32

$

45

$

31

$

46

$

50

(29)%

(36)%

$

77

$

116

(34)%

Non-interest income

(10)

(30)

(71)

2

(2)

(67)

**

(40)

6

**

Total net revenue (loss)(6)

22

15

(40)

48

48

47

(54)

37

122

(70)

Benefit for credit losses

(5)

(2)

(1)

(1)

(1)

150

**

(7)

(3)

133

Non-interest expense

56

72

104

94

63

(22)

(11)

128

111

15

Income (loss) from continuing operations before income taxes

(29)

(55)

(143)

(45)

(14)

(47)

107

(84)

14

**

Income tax benefit

(101)

(118)

(125)

(71)

(78)

(14)

29

(219)

(143)

53

Income (loss) from continuing operations, net of tax

$

72

$

63

$

(18)

$

26

$

64

14

13

$

135

$

157

(14)

Selected performance metrics:



















Period-end loans held for investment

$

67

$

73

$

64

$

76

$

82

(8)

(18)

$

67

$

82

(18)

Average loans held for investment

60

67

62

66

71

(10)

(15)

64

75

(15)

Period-end deposits

20,003

19,231

20,985

13,577

10,438

4

92

20,003

10,438

92

Average deposits

19,298

20,395

18,156

11,351

10,574

(5)

83

19,843

10,712

85

Total



















Earnings:



















Net interest income

$

5,473

$

5,474

$

5,447

$

5,277

$

5,093

—

7

%

$

10,947

$

10,149

8

%

Non-interest income

1,231

1,061

1,119

1,184

1,161

16

%

6

2,292

2,325

(1)

Total net revenue

6,704

6,535

6,566

6,461

6,254

3

7

13,239

12,474

6

Provision for credit losses

1,800

1,992

1,752

1,588

1,592

(10)

13

3,792

3,119

22

Non-interest expense

3,414

3,434

3,679

3,361

3,295

(1)

4

6,848

6,518

5

Income from continuing operations before income taxes

1,490

1,109

1,135

1,512

1,367

34

9

2,599

2,837

(8)

Income tax provision

443

314

342

496

424

41

4

757

876

(14)

Income from continuing operations, net of tax

$

1,047

$

795

$

793

$

1,016

$

943

32

11

$

1,842

$

1,961

(6)

Selected performance metrics:



















Period-end loans held for investment

$

244,302

$

240,588

$

245,586

$

238,019

$

234,603

2

4

$

244,302

$

234,603

4

Average loans held for investment

242,241

241,505

240,027

235,843

230,379

—

5

241,875

228,557

6

Period-end deposits

239,763

241,182

236,768

225,981

221,059

(1)

8

239,763

221,059

8

Average deposits

240,550

238,550

232,204

222,251

221,146

1

9

239,555

220,163

9

 

 

CAPITAL ONE FINANCIAL CORPORATION (COF)

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



(1)

In Q2 2017, we implemented changes in our charge-off practices for certain consumer banking loans. The Q2 2017 Auto net charge-offs amount includes approximately $48 million associated with implementing these changes, with an impact to the net charge-off rate of 38 basis points and 19 basis points for the three and six months ended June 30, 2017, respectively. Excluding this impact, the Auto net charge-off rate in those periods would have been 1.32% and 1.48%, respectively. The impact to the Consumer Banking net charge-off rate was 26 basis points and 13 basis points for the three and six months ended June 30, 2017, respectively. Excluding this impact, the Consumer Banking net charge-off rate in those periods would have been 0.99% and 1.09%, respectively.

(2)

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.

(3)

Nonperforming assets consist of nonperforming loans, real estate owned ("REO") 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, REO and other foreclosed assets. Prior to Q4 2016, the nonperforming asset rate for our Consumer Banking business excluded the impact of REOs related to our acquired home loan portfolio which, if included, would increase the nonperforming asset rate by approximately 10 basis points in each of the prior periods presented.

(4)

Primarily consists of the legacy loan portfolio of our discontinued GreenPoint mortgage operations.

(5)

Represents foreign currency translation adjustments and the net impact of loan transfers and sales.

(6)

Some of our tax-related commercial investments generate tax-exempt income or tax credits. Accordingly, we make certain reclassifications within our Commercial Banking business results to present revenues and yields on a taxable-equivalent basis, calculated assuming an effective tax rate approximately equal to our federal statutory tax rate of 35% with offsetting reclassifications 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)

Includes purchase transactions, net of returns, for the period for loans both classified as held for investment and held for sale. 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.

**

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,
2017

March 31,
2017

December 31,
2016

September 30,
2016

June 30,
2016

Regulatory Capital Metrics









Common equity excluding AOCI

$

45,459

$

44,614

$

44,103

$

44,214

$

44,572

Adjustments:









AOCI(2)(3)

(593)

(807)

(674)

199

332

Goodwill, net of related deferred tax liabilities

(14,299)

(14,302)

(14,307)

(14,288)

(14,296)

Intangible assets, net of related deferred tax liabilities(3)

(418)

(465)

(384)

(435)

(483)

Other

77

121

65

(498)

(639)

Common equity Tier 1 capital

$

30,226

$

29,161

$

28,803

$

29,192

$

29,486

Tier 1 capital

$

34,585

$

33,519

$

33,162

$

33,069

$

32,780

Total capital(4)

42,101

40,979

40,817

40,564

38,767

Risk-weighted assets

283,231

279,302

285,756

275,198

269,667

Adjusted average assets(5)

335,248

336,990

335,835

328,627

319,968

Capital Ratios









Common equity Tier 1 capital(6)

10.7

%

10.4

%

10.1

%

10.6

%

10.9

%

Tier 1 capital(7)

12.2

12.0

11.6

12.0

12.2

Total capital(8)

14.9

14.7

14.3

14.7

14.4

Tier 1 leverage(5)

10.3

9.9

9.9

10.1

10.2

Tangible common equity ("TCE")(9)

8.8

8.5

8.1

8.8

9.0

 

Reconciliation of Non-GAAP Measures

We report certain non-GAAP measures that management uses in assessing its capital adequacy and the level of return generated. The following non-GAAP measures consist of selected adjusted results, tangible common equity ("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 key financial performance measures. 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.



2017

2017

Six Months Ended


Q2

Q1

June 30, 2017

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

Reported Results

Adj.(10)

Adjusted Results

Reported Results

Adj.(10)

Adjusted Results

Reported Results

Adj.(10)

Adjusted Results

Selected income statement data:

















Net interest income

$

5,473

—

$

5,473

$

5,474

$

33

$

5,507

$

10,947

$

33

$

10,980

Non-interest income

1,231

—

1,231

1,061

37

1,098

2,292

37

2,329

Total net revenue

6,704

—

6,704

6,535

70

6,605

13,239

70

13,309

Provision for credit losses

1,800

—

1,800

1,992

—

1,992

3,792

—

3,792

Non-interest expense

3,414

$

(12)

3,402

3,434

(29)

3,405

6,848

(41)

6,807

Income from continuing operations before income taxes

1,490

12

1,502

1,109

99

1,208

2,599

111

2,710

Income tax provision (benefit)

443

4

447

314

(1)

313

757

3

760

Income from continuing operations, net of tax

1,047

8

1,055

795

100

895

1,842

108

1,950

Income (loss) from discontinued operations, net of tax

(11)

—

(11)

15

—

15

4

—

4

Net income

1,036

8

1,044

810

100

910

1,846

108

1,954

Net income available to common stockholders

948

8

956

752

100

852

1,700

108

1,808

Selected performance metrics:

















Diluted EPS(12)

$

1.94

$0.02

$

1.96

$

1.54

$0.21

$

1.75

$

3.49

$0.22

$

3.71

Efficiency ratio

50.92

%

(17)

bps

50.75

%

52.55

%

(100)

bps

51.55

%

51.73

%

(58)

bps

51.15

%

 

2016

2016

2016

Year Ended


Q4

Q3

Q2

December 31, 2016

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

Reported Results

Adj.(11)

Adjusted Results

Reported Results

Adj.(11)

Adjusted Results

Reported Results

Adj.(11)

Adjusted Results

Reported Results

Adj.(11)

Adjusted Results

Selected income statement data:























Net interest income

$

5,447

$

13

$

5,460

$

5,277

$

34

$

5,311

$

5,093

$

7

$

5,100

$

20,873

$

54

$

20,927

Non-interest income

1,119

14

1,133

1,184

13

1,197

1,161

8

1,169

4,628

35

4,663

Total net revenue

6,566

27

6,593

6,461

47

6,508

6,254

15

6,269

25,501

89

25,590

Provision for credit losses

1,752

—

1,752

1,588

—

1,588

1,592

—

1,592

6,459

—

6,459

Non-interest expense

3,679

(45)

3,634

3,361

(16)

3,345

3,295

(15)

3,280

13,558

(76)

13,482

Income from continuing operations before income taxes

1,135

72

1,207

1,512

63

1,575

1,367

30

1,397

5,484

165

5,649

Income tax provision (benefit)

342

10

352

496

—

496

424

(7)

417

1,714

3

1,717

Income from continuing operations, net of tax

793

62

855

1,016

63

1,079

943

37

980

3,770

162

3,932

Income (loss) from discontinued operations, net of tax

(2)

—

(2)

(11)

—

(11)

(1)

—

(1)

(19)

—

(19)

Net income

791

62

853

1,005

63

1,068

942

37

979

3,751

162

3,913

Net income available to common stockholders

710

62

772

962

63

1,025

871

37

908

3,513

162

3,675

Selected performance metrics:























Diluted EPS(12)

$

1.45

$0.13

$

1.58

$

1.90

$0.13

$

2.03

$

1.69

$0.07

$

1.76

$

6.89

$0.32

$

7.21

Efficiency ratio

56.03

%

(91)

bps

55.12

%

52.02

%

(62)

bps

51.40

%

52.69

%

(37)

bps

52.32

%

53.17

%

(49)

bps

52.68

%

 

 

 

2017

2017

2016

2016

2016

(Dollars in millions)

Q2

Q1

Q4

Q3

Q2

Tangible Common Equity (Period-End)









Stockholders' equity

$

49,137

$

48,040

$

47,514

$

48,213

$

48,108

Goodwill and intangible assets(13)

(15,301)

(15,360)

(15,420)

(15,475)

(15,553)

Noncumulative perpetual preferred stock

(4,360)

(4,360)

(4,360)

(3,877)

(3,294)

Tangible common equity

$

29,476

$

28,320

$

27,734

$

28,861

$

29,261

Tangible Common Equity (Average)









Stockholders' equity

$

49,005

$

48,193

$

47,972

$

49,033

$

48,934

Goodwill and intangible assets(13)

(15,336)

(15,395)

(15,455)

(15,507)

(15,585)

Noncumulative perpetual preferred stock

(4,360)

(4,360)

(4,051)

(3,719)

(3,294)

Tangible common equity

$

29,309

$

28,438

$

28,466

$

29,807

$

30,055

Tangible Assets (Period-End)









Total assets

$

350,593

$

348,549

$

357,033

$

345,061

$

339,117

Goodwill and intangible assets(13)

(15,301)

(15,360)

(15,420)

(15,475)

(15,553)

Tangible assets

$

335,292

$

333,189

$

341,613

$

329,586

$

323,564

Tangible Assets (Average)









Total assets

$

349,891

$

351,641

$

350,225

$

343,153

$

334,479

Goodwill and intangible assets(13)

(15,336)

(15,395)

(15,455)

(15,507)

(15,585)

Tangible assets

$

334,555

$

336,246

$

334,770

$

327,646

$

318,894

 

__________

(1)

Regulatory capital metrics and capital ratios as of June 30, 2017 are preliminary and therefore subject to change.

(2)

Amounts presented are net of tax.

(3)

Amounts based on transition provisions for regulatory capital deductions and adjustments of 60% for 2016 and 80% for 2017.

(4)

Total capital equals the sum of Tier 1 capital and Tier 2 capital.

(5)

Adjusted average assets for the purpose of calculating our Tier 1 leverage ratio represents total average assets adjusted for amounts that 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.

(6)

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

(7)

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

(8)

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

(9)

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

(10)

In Q2 2017, we incurred $12 million of costs related to our anticipated close of the Cabela's acquisition, which is subject to regulatory approval. In Q1 2017, we recorded a build in the U.K. Payment Protection Insurance customer refund reserve ("U.K. PPI Reserve") of $99 million.

(11)

In Q4 2016, we recorded charges totaling $72 million consisting of a build in the U.K. PPI Reserve of $44 million and an impairment associated with certain acquired intangible and software assets of $28 million. In Q3 2016, we recorded a build in the U.K. PPI Reserve of $63 million. In Q2 2016, we recorded charges totaling $30 million associated with a build of $54 million in the U.K. PPI Reserve, partially offset by a gain of $24 million related to the exchange of our ownership interest in Visa Europe with Visa Inc. as a result of Visa Inc.'s acquisition of Visa Europe. There were no adjustments to our reported results in Q1 2016.

(12)

Earnings per share is computed independently for each period. Accordingly, the sum of each quarter amount may not agree to the year-to-date total.

(13)

Includes impact of related deferred taxes.

 

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SOURCE Capital One Financial Corporation

Investor Relations, Jeff Norris, 703.720.2455, Danielle Dietz, 703.720.2455, Media Relations, Sie Soheili, 703.720.3929, Tatiana Stead, 703.720.2352