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United States securities and exchange commission logo
December 27, 2023
Andrew M. Young
Chief Financial Officer
Capital One Financial Corporation
1680 Capital One Drive
McLean, VA 22102
Re: Capital One
Financial Corporation
Form 10-K for
Fiscal Year Ended December 31, 2022
Form 10-Q for
Quarterly Period Ended September 30, 2023
File No. 001-13300
Dear Andrew M. Young:
We have limited our review of your filing to the financial
statements and related
disclosures and have the following comments.
Please respond to this letter within ten business days by
providing the requested
information or advise us as soon as possible when you will respond. If
you do not believe a
comment applies to your facts and circumstances, please tell us why in
your response.
After reviewing your
response to this letter, we may have additional comments.
Form 10-K for Fiscal Year Ended December 31, 2022
Management s Discussion and Analysis of Financial Condition and
Results of Operations
( MD&A )
Table 6: Funding Sources Composition, page 55
1. We note your disclosure
that period-end deposits increased by $14.2 billion at $270.6
billion as of December
31, 2022 from December 31, 2021 primarily driven by your
national banking
strategy and issuances of brokered deposits. Please revise your
disclosures, in future
filings, to provide more details around the national banking strategy,
including any formal
practices, guidelines, etc. which would allow an investor to
understand the strategy
and any related risks/trends. In addition, include discussion of any
related impacts the
brokered deposits have on your funding costs, net interest margin and
to the extent
applicable, whether you have policies or internal limits regarding
concentrations in
brokered deposits and / or uninsured deposits, in total or by type of
depositor, and whether
you have complied with any such internal requirements for the
periods presented.
Andrew M. Young
FirstName
Capital OneLastNameAndrew M. Young
Financial Corporation
Comapany27,
December NameCapital
2023 One Financial Corporation
December
Page 2 27, 2023 Page 2
FirstName LastName
Liquidity Risk Profile, page 92
2. Please disclose a table summarizing your total available sources of
liquidity, by type of
borrowing capacity, showing total borrowing capacity less borrowings
outstanding to
arrive at remaining capacity, then adding in other sources of
liquidity such as cash,
securities, etc. to arrive at total available liquidity, or tell us
where this information is
disclosed in the aggregate.
Interest Rate Risk, page 97
3. We note your disclosures discussing various key assumptions associated
with your net
interest income sensitivity and economic value of equity sensitivity.
The assumptions for
your net interest income sensitivity include loan and deposit growth
and pricing, and plans
for projected changes in funding mix in your baseline forecast. Key
assumptions used in
the calculation of your economic value of equity sensitivity measure
include projecting
rate sensitive prepayments for mortgage securities, loans and other
assets, term structure
modeling of interest rates, discount spreads, and deposit volume and
pricing
assumptions. Please revise your disclosures, in future filings, to
fully describe and define
the various identified inputs and assumptions supporting your market
risk presentations
and sensitivity disclosures. In addition, provide a discussion of how
any assumptions have
changed from period to period, including any changes to the data
source used or
significant changes in the actual assumption itself.
Form 10-Q for the Quarterly Period Ended September 30, 2023
Market Risk Profile, page 52
4. We note your disclosure and references to deposit beta as part of your
net interest income
and economic value of equity sensitivity analyses, which indicates
that it increased
compared to December 31, 2022. Please expand your disclosures, in
future filings, to
quantify and discuss changes in your deposit beta and/or cumulative
deposit beta between
periods presented, to the extent that it is monitored and used by
management, as well as a
more fulsome discussion of how the metric is calculated. In this
regard, we noted
commentary during your third quarter of 2023 earnings call discussing
your cumulative
beta.
In closing, we remind you that the company and its management are
responsible for the
accuracy and adequacy of their disclosures, notwithstanding any review,
comments, action or
absence of action by the staff.
Please contact Michael Henderson at 202-551-3364 or Robert Klein at
202-551-3847
with any questions.
Andrew M. Young
Capital One Financial Corporation
December 27, 2023
Page 3
FirstName LastNameAndrew M. Young Sincerely,
Comapany NameCapital One Financial Corporation
Division of Corporation
Finance
December 27, 2023 Page 3 Office of Finance
FirstName LastName