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Capital One Reports First Quarter 2024 Net Income of $1.3 billion, or $3.13 per share

Published: 2024-04-25 20:05:00 ET
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Net of adjusting items, First Quarter 2024 Net Income of $3.21 per share(1)

MCLEAN, Va., April 25, 2024 /PRNewswire/ -- Capital One Financial Corporation (NYSE: COF) today announced net income for the first quarter of 2024 of $1.3 billion, or $3.13 per diluted common share, compared with net income of $706 million, or $1.67 per diluted common share in the fourth quarter of 2023, and with net income of $960 million, or $2.31 per diluted common share in the first quarter of 2023. Adjusted net income(1) for the first quarter of 2024 was $3.21 per diluted common share.

Capital One Financial

"First quarter results continue to show top-line growth, stabilizing consumer credit, and balance sheet strength," said Richard Fairbank, Founder, Chairman, and Chief Executive Officer  "And in the quarter, we announced our definitive agreement to acquire Discover. The acquisition of Discover is a singular opportunity that creates a consumer banking and global payments platform with the capabilities, technology, brands, and customer franchise to create significant value for merchants, consumers, small businesses and shareholders."

The quarter included the following adjusting item:

(Dollars in millions, except per share data)

Pre-Tax

Impact

After-TaxDiluted EPS

Impact

FDIC special assessment

$                   42

$                          0.08

All comparisons below are for the first quarter of 2024 compared with the fourth quarter of 2023 unless otherwise noted.

First Quarter 2024 Income Statement Summary:

  • Total net revenue decreased 1 percent to $9.4 billion.
  • Total non-interest expense decreased 10 percent to $5.1 billion:
    • 19 percent decrease in marketing.
    • 8 percent decrease in operating expenses.
  • Pre-provision earnings(2) increased 13 percent to $4.3 billion.
  • Provision for credit losses decreased $174 million to $2.7 billion:
    • Net charge-offs of $2.6 billion.
    • $91 million loan reserve build.
  • Net interest margin of 6.69 percent, a decrease of 4 basis points.
  • Efficiency ratio of 54.64 percent.
    • Adjusted efficiency ratio(1) of 54.19 percent.
  • Operating efficiency ratio of 43.89 percent.
    • Adjusted operating efficiency ratio(1) of 43.45 percent.

First Quarter 2024 Balance Sheet Summary:

  • Common equity Tier 1 capital ratio(3) under Basel III Standardized Approach of 13.1 percent at March 31, 2024.
  • Period-end loans held for investment in the quarter decreased $5.3 billion, or 2 percent, to $315.2 billion.
    • Credit Card period-end loans decreased $4.0 billion, or 3 percent, to $150.6 billion.
      • Domestic Card period-end loans decreased $3.8 billion, or 3 percent, to $143.9 billion.
    • Consumer Banking period-end loans decreased $338 million, or less than 1 percent, to $75.1 billion.
      • Auto period-end loans decreased $274 million, or less than 1 percent, to $73.8 billion.
    • Commercial Banking period-end loans decreased $1.0 billion, or 1 percent, to $89.5 billion.
  • Average loans held for investment in the quarter decreased $1.3 billion, or less than 1 percent, to $314.6 billion.
    • Credit Card average loans increased $1.0 billion, or 1 percent, to $149.6 billion.
      • Domestic Card average loans increased $775 million, or 1 percent, to $142.9 billion.
    • Consumer Banking average loans decreased $1.1 billion, or 2 percent, to $75.1 billion.
      • Auto average loans decreased $1.1 billion, or 1 percent, to $73.8 billion.
    • Commercial Banking average loans decreased $1.1 billion, or 1 percent, to $89.9 billion.
  • Period-end total deposits increased $2.6 billion, or 1 percent, to $351.0 billion, while average deposits increased $329 million, or less than 1 percent, to $345.7 billion.
  • Interest-bearing deposits rate paid increased 6 basis points to 3.53 percent.

(1)

This is a non-GAAP measure. We believe non-GAAP measures help investors and users of our financial information understand the effect of adjusting items on our selected reported results and provide alternate measurements of our performance, both in the current period and across periods. See our Financial Supplement, filed as Exhibit 99.2 to our Current Report on From 8-K on April 25, 2024 with the SEC, "Table 15: Calculation of Regulatory Capital Measures and Reconciliation of Non-GAAP Measures" for a reconciliation and additional information on non-GAAP measures.

(2)

Pre-provision earnings is a non-GAAP metric calculated based on total net revenue less non-interest expense for the period. Management believes that this financial metric is useful in assessing the ability of a lending institution to generate income in excess of its provision for credit losses. See our Financial Supplement, filed as Exhibit 99.2 to our Current Report on From 8-K on April 25, 2024 with the SEC, "Table 15: Calculation of Regulatory Capital Measures and Reconciliation of Non-GAAP Measures" for a reconciliation and additional information on non-GAAP measures.

(3)

Regulatory capital metrics as of March 31, 2024 are preliminary and therefore subject to change.

 

Earnings Conference Call Webcast Information

The company will hold an earnings conference call on April 25, 2024 at 5:00 PM Eastern Time. The conference call will be accessible through live webcast. Interested investors and other individuals can access the webcast via the company's home page (www.capitalone.com). Under "About," choose "Investors" to access the Investor Center and view and/or download the earnings press release, the financial supplement, including a reconciliation of non-GAAP financial measures, and the earnings release presentation. The replay of the webcast will be archived on the company's website through May 9, 2024 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. Forward-looking statements often use words such as "will," "anticipate," "target," "expect," "think," "estimate," "intend," "plan," "goal," "believe," "forecast," "outlook" or other words of similar meaning. Any forward-looking statements made by Capital One or on its behalf speak only as of the date they are made or as of the date indicated, and Capital One does not undertake any obligation to update forward-looking statements as a result of new information, future events or otherwise. 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. For additional information on factors that could materially influence forward-looking statements included in this earnings press release, see the risk factors set forth under "Part I—Item 1A. Risk Factors" in the Annual Report on Form 10-K for the year ended December 31, 2023 filed with the Securities and Exchange Commission (the "SEC") and Quarterly Reports on Form 10-Q and Current Reports on Form 8-K filed with the SEC.

About Capital One

Capital One Financial Corporation (www.capitalone.com) is a financial holding company which, along with its subsidiaries, had $351.0 billion in deposits and $481.7 billion in total assets as of March 31, 2024. 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 and Cafés located primarily in New York, Louisiana, Texas, Maryland, Virginia 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 2024

Table of Contents

 

Capital One Financial Corporation Consolidated Results

Page

Table 1:

Financial Summary—Consolidated

1

Table 2:

Selected Metrics—Consolidated

3

Table 3:

Consolidated Statements of Income

4

Table 4:

Consolidated Balance Sheets

6

Table 5:

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

8

Table 6:

Average Balances, Net Interest Income and Net Interest Margin

9

Table 7:

Loan Information and Performance Statistics

10

Table 8:

Allowance for Credit Losses and Reserve for Unfunded Lending Commitments Activity

12

Business Segment Results

Table 9:

Financial Summary—Business Segment Results

13

Table 10:

Financial & Statistical Summary—Credit Card Business

14

Table 11:

Financial & Statistical Summary—Consumer Banking Business

16

Table 12:

Financial & Statistical Summary—Commercial Banking Business

17

Table 13:

Financial & Statistical Summary—Other and Total

18

Other

Table 14:

Notes to Net Interest Margin, Loan, Allowance and Business Segment Disclosures (Tables 6—13)

19

Table 15:

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

20

__________

(1)

The information contained in this Financial Supplement is preliminary and based on data available at the time of the earnings presentation. Investors should refer to our Quarterly Report on Form 10-Q for the period ended March 31, 2024 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. See "Table 15: Calculation of Regulatory Capital Measures and Reconciliation of Non-GAAP Measures" for a reconciliation of any non-GAAP financial measures.

 

CAPITAL ONE FINANCIAL CORPORATION (COF)

Table 1: Financial Summary—Consolidated      

2024 Q1

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

2024

Q1

2023

Q4

2023

Q3

2023

Q2

2023

Q1

2023

Q4

2023

Q1

Income Statement

Net interest income

$      7,488

$      7,519

$      7,423

$      7,113

$      7,186

—

4 %

Non-interest income

1,914

1,987

1,943

1,899

1,717

(4) %

11

Total net revenue(1)

9,402

9,506

9,366

9,012

8,903

(1)

6

Provision for credit losses

2,683

2,857

2,284

2,490

2,795

(6)

(4)

Non-interest expense:

Marketing

1,010

1,254

972

886

897

(19)

13

Operating expense

4,127

4,463

3,888

3,908

4,048

(8)

2

Total non-interest expense

5,137

5,717

4,860

4,794

4,945

(10)

4

Income from continuing operations before income taxes

1,582

932

2,222

1,728

1,163

70

36

Income tax provision

302

226

432

297

203

34

49

Net income

1,280

706

1,790

1,431

960

81

33

Dividends and undistributed earnings allocated to participating securities(2)

(23)

(10)

(28)

(23)

(16)

130

44

Preferred stock dividends

(57)

(57)

(57)

(57)

(57)

—

—

Net income available to common stockholders

$      1,200

$        639

$      1,705

$      1,351

$        887

88

35

Common Share Statistics

Basic earnings per common share:(2)

Net income per basic common share

$       3.14

$       1.67

$       4.46

$       3.53

$       2.32

88 %

35 %

Diluted earnings per common share:(2)

Net income per diluted common share

$       3.13

$       1.67

$       4.45

$       3.52

$       2.31

87 %

35 %

Weighted-average common shares outstanding (in millions):

Basic

382.2

381.9

382.5

382.8

382.6

—

—

Diluted

383.4

382.8

383.3

383.7

383.8

—

—

Common shares outstanding (period-end, in millions)

382.1

380.4

381.0

381.4

382.0

—

—

Dividends declared and paid per common share

$       0.60

$       0.60

$       0.60

$       0.60

$       0.60

—

—

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

98.67

99.78

87.97

90.07

90.86

(1) %

9 %

2024 Q1

(Dollars in millions)

2024

Q1

2023

Q4

2023

Q3

2023

Q2

2023

Q1

2023

Q4

2023

Q1

Balance Sheet (Period-End)

Loans held for investment

$  315,154

$  320,472

$  314,780

$  311,323

$  308,836

(2) %

2 %

Interest-earning assets

453,557

449,701

445,428

441,250

445,166

1

2

Total assets

481,720

478,464

471,435

467,800

471,660

1

2

Interest-bearing deposits

323,352

320,389

317,217

314,393

318,641

1

1

Total deposits

350,969

348,413

346,011

343,705

349,827

1

—

Borrowings

50,361

49,856

49,247

50,258

48,777

1

3

Common equity

52,955

53,244

48,823

49,713

49,807

(1)

6

Total stockholders' equity

57,801

58,089

53,668

54,559

54,653

—

6

Balance Sheet (Average Balances)

Loans held for investment

$  314,614

$  315,890

$  312,759

$  309,655

$  307,756

—

2 %

Interest-earning assets

447,803

446,929

443,532

439,139

435,199

—

3

Total assets

474,995

472,594

469,860

466,652

462,324

1 %

3

Interest-bearing deposits

318,450

316,808

316,032

313,207

308,788

1

3

Total deposits

345,657

345,328

345,013

343,678

340,123

—

2

Borrowings

50,474

51,070

49,736

48,468

48,016

(1)

5

Common equity

53,152

50,786

50,166

50,511

49,927

5

6

Total stockholders' equity

57,998

55,632

55,012

55,357

54,773

4

6

 

CAPITAL ONE FINANCIAL CORPORATION (COF)

Table 2: Selected Metrics—Consolidated

2024 Q1

(Dollars in millions, except as noted)

2024

Q1

2023

Q4

2023

Q3

2023

Q2

2023

Q1

2023

Q4

2023

Q1

Performance Metrics

Net interest income growth (period over period)

—

1 %

4 %

(1) %

—

**

**

Non-interest income growth (period over period)

(4) %

2

2

11

(7) %

**

**

Total net revenue growth (period over period)

(1)

1

4

1

(2)

**

**

Total net revenue margin(4)

8.40

8.51

8.45

8.21

8.18

(11) bps

22 bps

Net interest margin(5)

6.69

6.73

6.69

6.48

6.60

(4)

9

Return on average assets

1.08

0.60

1.52

1.23

0.83

48

25

Return on average tangible assets(6)

1.11

0.62

1.58

1.27

0.86

49

25

Return on average common equity(7)

9.03

5.03

13.59

10.70

7.11

400

192

Return on average tangible common equity(8)

12.67

7.20

19.59

15.30

10.15

547

252

Efficiency ratio(9)

54.64

60.14

51.89

53.20

55.54

(550)

(90)

Operating efficiency ratio(10)

43.89

46.95

41.51

43.36

45.47

(306)

(158)

Effective income tax rate for continuing operations

19.1

24.2

19.4

17.2

17.5

(510)

160

Employees (period-end, in thousands)

51.3

52.0

54.2

55.6

56.1

(1) %

(9) %

Credit Quality Metrics

Allowance for credit losses

$  15,380

$  15,296

$  14,955

$  14,646

$  14,318

1 %

7 %

Allowance coverage ratio

4.88 %

4.77 %

4.75 %

4.70 %

4.64 %

11 bps

24 bps

Net charge-offs

$    2,616

$    2,533

$    1,999

$    2,185

$    1,697

3 %

54 %

Net charge-off rate(11)

3.33 %

3.21 %

2.56 %

2.82 %

2.21 %

12 bps

112 bps

30+ day performing delinquency rate

3.40

3.71

3.42

3.08

2.88

(31)

52

30+ day delinquency rate

3.67

3.99

3.71

3.36

3.09

(32)

58

Capital Ratios(12)

Common equity Tier 1 capital 

13.1 %

12.9 %

13.0 %

12.7 %

12.5 %

20 bps

60 bps

Tier 1 capital

14.4

14.2

14.3

14.0

13.9

20

50

Total capital

16.3

16.0

16.2

16.0

15.9

30

40

Tier 1 leverage

11.3

11.2

11.2

11.0

10.9

10

40

Tangible common equity ("TCE")(13)

8.1

8.2

7.3

7.6

7.6

(10)

50

 

CAPITAL ONE FINANCIAL CORPORATION (COF)

Table 3: Consolidated Statements of Income

2024 Q1

(Dollars in millions, except as noted)

2024

Q1

2023

Q4

2023

Q3

2023

Q2

2023

Q1

2023

Q4

2023

Q1

Interest income:

Loans, including loans held for sale

$      9,920

$      9,934

$      9,696

$      9,057

$      8,723

—

14 %

Investment securities

687

669

627

639

615

3 %

12

Other

570

542

550

470

416

5

37

Total interest income

11,177

11,145

10,873

10,166

9,754

—

15

Interest expense:

Deposits

2,812

2,745

2,611

2,277

1,856

2

52

Securitized debt obligations

261

263

249

236

211

(1)

24

Senior and subordinated notes

606

608

579

528

489

—

24

Other borrowings

10

10

11

12

12

—

(17)

Total interest expense

3,689

3,626

3,450

3,053

2,568

2

44

Net interest income

7,488

7,519

7,423

7,113

7,186

—

4

Provision for credit losses

2,683

2,857

2,284

2,490

2,795

(6)

(4)

Net interest income after provision for credit losses

4,805

4,662

5,139

4,623

4,391

3

9

Non-interest income:

Interchange fees, net

1,145

1,207

1,234

1,213

1,139

(5)

1

Service charges and other customer-related fees

462

424

453

411

379

9

22

Net securities gains (losses)

—

(34)

—

—

—

**

—

Other

307

390

256

275

199

(21)

54

Total non-interest income

1,914

1,987

1,943

1,899

1,717

(4)

11

Non-interest expense:

Salaries and associate benefits

2,478

2,284

2,274

2,317

2,427

8

2

Occupancy and equipment

554

628

518

506

508

(12)

9

Marketing

1,010

1,254

972

886

897

(19)

13

Professional services

262

359

295

290

324

(27)

(19)

Communications and data processing

351

345

344

344

350

2

—

Amortization of intangibles

19

22

24

22

14

(14)

36

Other

463

825

433

429

425

(44)

9

Total non-interest expense

5,137

5,717

4,860

4,794

4,945

(10)

4

Income from continuing operations before income taxes

1,582

932

2,222

1,728

1,163

70

36

Income tax provision

302

226

432

297

203

34

49

Net income

1,280

706

1,790

1,431

960

81

33

Dividends and undistributed earnings allocated to participating securities(2)

(23)

(10)

(28)

(23)

(16)

130

44

Preferred stock dividends

(57)

(57)

(57)

(57)

(57)

—

—

Net income available to common stockholders

$      1,200

$         639

$      1,705

$      1,351

$         887

88

35

2024 Q1

2024

Q1

2023

Q4

2023

Q3

2023

Q2

2023

Q1

2023

Q4

2023

Q1

Basic earnings per common share:(2)

Net income per basic common share

$        3.14

$        1.67

$        4.46

$        3.53

$        2.32

88 %

35 %

Diluted earnings per common share:(2)

Net income per diluted common share

$        3.13

$        1.67

$        4.45

$        3.52

$        2.31

87 %

35 %

Weighted-average common shares outstanding (in millions):

Basic common shares

382.2

381.9

382.5

382.8

382.6

—

—

Diluted common shares

383.4

382.8

383.3

383.7

383.8

—

—

 

CAPITAL ONE FINANCIAL CORPORATION (COF)

Table 4: Consolidated Balance Sheets

2024 Q1

(Dollars in millions)

2024

Q1

2023

Q4

2023

Q3

2023

Q2

2023

Q1

2023

Q4

2023

Q1

Assets:

Cash and cash equivalents:

Cash and due from banks

$     4,671

$     4,903

$     4,620

$     3,360

$     3,347

(5) %

40 %

Interest-bearing deposits and other short-term investments

46,357

38,394

40,249

38,236

43,166

21

7

Total cash and cash equivalents

51,028

43,297

44,869

41,596

46,513

18

10

Restricted cash for securitization investors

474

458

435

452

460

3

3

Securities available for sale

78,398

79,117

74,837

78,412

81,925

(1)

(4)

Loans held for investment:

Unsecuritized loans held for investment

285,577

289,229

284,953

280,933

280,093

(1)

2

Loans held in consolidated trusts

29,577

31,243

29,827

30,390

28,743

(5)

3

Total loans held for investment

315,154

320,472

314,780

311,323

308,836

(2)

2

Allowance for credit losses

(15,380)

(15,296)

(14,955)

(14,646)

(14,318)

1

7

Net loans held for investment

299,774

305,176

299,825

296,677

294,518

(2)

2

Loans held for sale

1,631

854

742

1,211

363

91

**

Premises and equipment, net

4,366

4,375

4,378

4,359

4,365

—

—

Interest receivable

2,514

2,478

2,469

2,297

2,250

1

12

Goodwill

15,062

15,065

15,048

15,060

14,779

—

2

Other assets

28,473

27,644

28,832

27,736

26,487

3

7

Total assets

$ 481,720

$ 478,464

$ 471,435

$ 467,800

$ 471,660

1

2

2024 Q1

(Dollars in millions)

2024

Q1

2023

Q4

2023

Q3

2023

Q2

2023

Q1

2023

Q4

2023

Q1

Liabilities:

Interest payable

$        762

$        649

$        685

$        637

$        621

17 %

23 %

Deposits:

Non-interest-bearing deposits

27,617

28,024

28,794

29,312

31,186

(1)

(11)

Interest-bearing deposits

323,352

320,389

317,217

314,393

318,641

1

1

Total deposits

350,969

348,413

346,011

343,705

349,827

1

—

Securitized debt obligations

17,661

18,043

17,417

17,861

17,813

(2)

(1)

Other debt:

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

568

538

522

649

542

6

5

Senior and subordinated notes

32,108

31,248

31,283

31,627

30,398

3

6

Other borrowings

24

27

25

121

24

(11)

—

Total other debt

32,700

31,813

31,830

32,397

30,964

3

6

Other liabilities

21,827

21,457

21,824

18,641

17,782

2

23

Total liabilities

423,919

420,375

417,767

413,241

417,007

1

2

Stockholders' equity:

Preferred stock

0

0

0

0

0

—

—

Common stock

7

7

7

7

7

—

—

Additional paid-in capital, net

35,808

35,541

35,334

35,163

34,952

1

2

Retained earnings

61,905

60,945

60,529

59,028

57,898

2

7

Accumulated other comprehensive loss

(9,534)

(8,268)

(12,224)

(9,818)

(8,540)

15

12

Treasury stock, at cost

(30,385)

(30,136)

(29,978)

(29,821)

(29,664)

1

2

Total stockholders' equity

57,801

58,089

53,668

54,559

54,653

—

6

Total liabilities and stockholders' equity

$ 481,720

$ 478,464

$ 471,435

$ 467,800

$ 471,660

1

2

 

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 $630 million in Q1 2024, $566 million in Q4 2023, $449 million in Q3 2023, $443 million in Q2 2023 and $405 million in Q1 2023 for credit card finance charges and fees charged-off as uncollectible.

(2)

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

(3)

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

(4)

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

(5)

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

(6)

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

(7)

Return on average common equity is calculated based on annualized net income (loss) available to common stockholders less annualized income (loss) from discontinued operations, net of tax, for the period, divided by average common equity. Our calculation of return on average common equity may not be comparable to similarly-titled measures reported by other companies.

(8)

Return on average tangible common equity is a non-GAAP measure calculated based on annualized net income (loss) available to common stockholders less annualized income (loss) from discontinued operations, net of tax, for the period, divided by average TCE. See "Table 15: Calculation of Regulatory Capital Measures and Reconciliation of Non-GAAP Measures" for additional information on non-GAAP measures.

(9)

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

(10)

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

(11)

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

(12)

Capital ratios as of the end of Q1 2024 are preliminary and therefore subject to change. See "Table 15: Calculation of Regulatory Capital Measures and Reconciliation of Non-GAAP Measures" for information on the calculation of each of these ratios.

(13)

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

**

Not meaningful.

 

CAPITAL ONE FINANCIAL CORPORATION (COF)

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

2024 Q1

2023 Q4

2023 Q1

(Dollars in millions, except as noted)

AverageBalance

InterestIncome/Expense

Yield/Rate(1)

AverageBalance

InterestIncome/Expense

Yield/Rate(1)

AverageBalance

InterestIncome/Expense

Yield/Rate(1)

Interest-earning assets:

Loans, including loans held for sale

$   315,563

$      9,920

12.57 %

$   316,670

$      9,934

12.55 %

$   308,115

$      8,723

11.32 %

Investment securities

88,581

687

3.10

88,650

669

3.02

89,960

615

2.73

Cash equivalents and other

43,659

570

5.21

41,609

542

5.21

37,124

416

4.49

Total interest-earning assets

$   447,803

$     11,177

9.98

$   446,929

$     11,145

9.97

$   435,199

$      9,754

8.96

Interest-bearing liabilities:

Interest-bearing deposits

$   318,450

$      2,812

3.53

$   316,808

$      2,745

3.47

$   308,788

$      1,856

2.40

Securitized debt obligations

17,836

261

5.85

18,022

263

5.84

17,251

211

4.90

Senior and subordinated notes

32,211

606

7.52

32,586

608

7.46

30,136

489

6.49

Other borrowings and liabilities(2)

2,373

10

1.78

2,349

10

1.74

2,335

12

2.08

Total interest-bearing liabilities

$   370,870

$      3,689

3.98

$   369,765

$      3,626

3.92

$   358,510

$      2,568

2.87

Net interest income/spread

$      7,488

6.00

$      7,519

6.05

$      7,186

6.10

Impact of non-interest-bearing funding

0.69

0.68

0.50

Net interest margin

6.69 %

6.73 %

6.60 %

 

CAPITAL ONE FINANCIAL CORPORATION (COF)

Table 7: Loan Information and Performance Statistics 

2024 Q1

(Dollars in millions, except as noted)

2024

Q1

2023

Q4

2023

Q3

2023

Q2

2023

Q1

2023

Q4

2023

Q1

Loans Held for Investment (Period-End)

Credit card:

   Domestic credit card

$   143,861

$   147,666

$   140,320

$   135,975

$   130,980

(3) %

10 %

   International card businesses

6,733

6,881

6,463

6,516

6,162

(2)

9

Total credit card

150,594

154,547

146,783

142,491

137,142

(3)

10

Consumer banking:

   Auto

73,801

74,075

75,456

75,841

76,652

—

(4)

   Retail banking

1,298

1,362

1,388

1,439

1,499

(5)

(13)

Total consumer banking

75,099

75,437

76,844

77,280

78,151

—

(4)

Commercial banking:

   Commercial and multifamily real estate

34,272

34,446

35,622

36,041

37,132

(1)

(8)

   Commercial and industrial

55,189

56,042

55,531

55,511

56,411

(2)

(2)

Total commercial banking

89,461

90,488

91,153

91,552

93,543

(1)

(4)

Total loans held for investment

$   315,154

$   320,472

$   314,780

$   311,323

$   308,836

(2)

2

Loans Held for Investment (Average)

Credit card:

   Domestic credit card

$   142,887

$   142,112

$   137,500

$   132,505

$   128,562

1 %

11 %

   International card businesses

6,758

6,515

6,549

6,257

6,108

4

11

Total credit card

149,645

148,627

144,049

138,762

134,670

1

11

Consumer banking:

   Auto

73,768

74,861

75,740

76,233

77,465

(1)

(5)

   Retail banking

1,324

1,377

1,414

1,465

1,529

(4)

(13)

Total consumer banking

75,092

76,238

77,154

77,698

78,994

(2)

(5)

Commercial banking:

   Commercial and multifamily real estate

34,310

35,414

35,964

37,068

37,373

(3)

(8)

   Commercial and industrial

55,567

55,611

55,592

56,127

56,719

—

(2)

Total commercial banking

89,877

91,025

91,556

93,195

94,092

(1)

(4)

Total average loans held for investment

$   314,614

$   315,890

$   312,759

$   309,655

$   307,756

—

2

2024 Q1

2024

Q1

2023

Q4

2023

Q3

2023

Q2

2023

Q1

2023

Q4

2023

Q1

Net Charge-Off (Recovery) Rates

Credit card:

   Domestic credit card(3)

5.94 %

5.35 %

4.40 %

4.38 %

4.04 %

59 bps

190 bps

   International card businesses

5.16

4.94

4.87

4.98

4.54

22

62

Total credit card

5.90

5.33

4.42

4.41

4.06

57

184

Consumer banking:

   Auto

1.99

2.19

1.77

1.40

1.53

(20)

46

   Retail banking

4.04

5.68

3.80

3.25

2.97

(164)

107

Total consumer banking

2.03

2.25

1.81

1.43

1.56

(22)

47

Commercial banking:

   Commercial and multifamily real estate

0.20

0.96

0.27

3.91

0.19

(76)

1

   Commercial and industrial

0.08

0.26

0.24

0.11

0.03

(18)

5

Total commercial banking

0.13

0.53

0.25

1.62

0.09

(40)

4

Total net charge-offs

3.33

3.21

2.56

2.82

2.21

12

112

30+ Day Performing Delinquency Rates

Credit card:

   Domestic credit card

4.48 %

4.61 %

4.31 %

3.74 %

3.66 %

(13) bps

82 bps

   International card businesses

4.83

4.67

4.43

4.24

4.20

16

63

Total credit card

4.50

4.61

4.32

3.77

3.68

(11)

82

Consumer banking:

   Auto

5.28

6.34

5.64

5.38

5.00

(106)

28

   Retail banking

0.95

1.19

1.07

1.19

0.56

(24)

39

Total consumer banking

5.21

6.25

5.55

5.30

4.92

(104)

29

Nonperforming Loans and Nonperforming Assets Rates(4)(5)

Credit card:

   International card businesses

0.13 %

0.13 %

0.14 %

0.16 %

0.12 %

—

1 bps

Total credit card

0.01

0.01

0.01

0.01

0.01

—

—

Consumer banking:

   Auto

0.79

0.96

0.85

0.77

0.67

(17) bps

12

   Retail banking

3.21

3.36

3.28

2.99

2.94

(15)

27

Total consumer banking

0.83

1.00

0.89

0.82

0.72

(17)

11

Commercial banking:

   Commercial and multifamily real estate

1.58

1.23

1.29

1.15

0.90

35

68

   Commercial and industrial

1.10

0.60

0.65

0.71

0.72

50

38

Total commercial banking

1.28

0.84

0.90

0.89

0.79

44

49

Total nonperforming loans

0.57

0.48

0.48

0.47

0.42

9

15

Total nonperforming assets

0.58

0.50

0.50

0.48

0.44

8

14

 

CAPITAL ONE FINANCIAL CORPORATION (COF)

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

Three Months Ended March 31, 2024

Credit Card

Consumer Banking

(Dollars in millions)

DomesticCard

InternationalCardBusinesses

Total CreditCard

Auto

RetailBanking

TotalConsumerBanking

CommercialBanking

Total

Allowance for credit losses:

Balance as of December 31, 2023

$       11,261

$             448

$       11,709

$         2,002

$             40

$        2,042

$         1,545

$       15,296

Charge-offs

(2,452)

(122)

(2,574)

(642)

(18)

(660)

(39)

(3,273)

Recoveries

332

35

367

275

5

280

10

657

Net charge-offs

(2,120)

(87)

(2,207)

(367)

(13)

(380)

(29)

(2,616)

Provision for credit losses

2,157

102

2,259

422

4

426

22

2,707

Allowance build (release) for credit losses

37

15

52

55

(9)

46

(7)

91

Other changes(6)

—

(7)

(7)

—

—

—

—

(7)

Balance as of March 31, 2024

11,298

456

11,754

2,057

31

2,088

1,538

15,380

Reserve for unfunded lending commitments:

Balance as of December 31, 2023

—

—

—

—

—

—

158

158

Provision (benefit) for losses on unfunded lending commitments

—

—

—

—

—

—

(24)

(24)

Balance as of March 31, 2024

—

—

—

—

—

—

134

134

Combined allowance and reserve as of March 31, 2024

$       11,298

$             456

$       11,754

$         2,057

$             31

$        2,088

$         1,672

$       15,514

 

CAPITAL ONE FINANCIAL CORPORATION (COF)

Table 9: Financial Summary—Business Segment Results

Three Months Ended March 31, 2024

(Dollars in millions)

Credit Card

ConsumerBanking

CommercialBanking(7)

Other(7)

Total

Net interest income (loss)

$        5,272

$       2,011

$             599

$      (394)

$      7,488

Non-interest income (loss)

1,476

159

281

(2)

1,914

Total net revenue (loss)

6,748

2,170

880

(396)

9,402

Provision (benefit) for credit losses

2,259

426

(2)

—

2,683

Non-interest expense

3,229

1,246

515

147

5,137

Income (loss) from continuing operations before income taxes

1,260

498

367

(543)

1,582

Income tax provision (benefit)

299

117

87

(201)

302

Income (loss) from continuing operations, net of tax

$           961

$          381

$             280

$      (342)

$      1,280

Three Months Ended December 31, 2023

(Dollars in millions)

Credit Card

ConsumerBanking

CommercialBanking(7)

Other(7)

Total

Net interest income (loss)

$        5,231

$       1,951

$             617

$      (280)

$      7,519

Non-interest income

1,565

163

245

14

1,987

Total net revenue (loss)

6,796

2,114

862

(266)

9,506

Provision (benefit) for credit losses

2,353

422

84

(2)

2,857

Non-interest expense

3,417

1,402

487

411

5,717

Income (loss) from continuing operations before income taxes

1,026

290

291

(675)

932

Income tax provision (benefit)

241

68

68

(151)

226

Income (loss) from continuing operations, net of tax

$           785

$          222

$             223

$      (524)

$        706

Three Months Ended March 31, 2023

(Dollars in millions)

Credit Card

ConsumerBanking

CommercialBanking(7)

Other(7)

Total

Net interest income (loss)

$        4,657

$       2,360

$             648

$      (479)

$      7,186

Non-interest income

1,363

135

212

7

1,717

Total net revenue (loss)

6,020

2,495

860

(472)

8,903

Provision (benefit) for credit losses

2,261

275

259

—

2,795

Non-interest expense

3,038

1,283

530

94

4,945

Income (loss) from continuing operations before income taxes

721

937

71

(566)

1,163

Income tax provision (benefit)

172

221

17

(207)

203

Income (loss) from continuing operations, net of tax

$           549

$          716

$               54

$      (359)

$        960

 

CAPITAL ONE FINANCIAL CORPORATION (COF)

Table 10: Financial & Statistical Summary—Credit Card Business

2024 Q1 vs

(Dollars in millions, except as noted)

2024

Q1

2023

Q4

2023

Q3

2023

Q2

2023

Q1

2023

Q4

2023

Q1

Credit Card

Earnings:

Net interest income

$    5,272

$   5,231

$   5,114

$   4,727

$   4,657

1 %

13 %

Non-interest income

1,476

1,565

1,513

1,499

1,363

(6)

8

Total net revenue

6,748

6,796

6,627

6,226

6,020

(1)

12

Provision for credit losses

2,259

2,353

1,953

2,084

2,261

(4)

—

Non-interest expense

3,229

3,417

3,015

3,020

3,038

(6)

6

Income from continuing operations before income taxes

1,260

1,026

1,659

1,122

721

23

75

Income tax provision

299

241

393

265

172

24

74

Income from continuing operations, net of tax

$      961

$      785

$   1,266

$      857

$      549

22

75

Selected performance metrics:

Period-end loans held for investment

$  150,594

$ 154,547

$ 146,783

$ 142,491

$ 137,142

(3)

10

Average loans held for investment

149,645

148,627

144,049

138,762

134,670

1

11

Average yield on loans outstanding(1)

18.84 %

18.96 %

19.02 %

18.17 %

17.98 %

(12) bps

86 bps

Total net revenue margin(8)

17.99

18.24

18.40

17.95

17.88

(25)

11

Net charge-off rate

5.90

5.33

4.42

4.41

4.06

57

184

30+ day performing delinquency rate

4.50

4.61

4.32

3.77

3.68

(11)

82

30+ day delinquency rate

4.50

4.62

4.32

3.77

3.69

(12)

81

Nonperforming loan rate(4)

0.01

0.01

0.01

0.01

0.01

—

—

Purchase volume(9)

$  150,171

$ 162,055

$ 158,640

$ 157,937

$ 141,658

(7) %

6 %

2024 Q1 vs

(Dollars in millions, except as noted)

2024

Q1

2023

Q4

2023

Q3

2023

Q2

2023

Q1

2023

Q4

2023

Q1

Domestic Card

Earnings:

Net interest income

$    4,972

$   4,940

$   4,827

$   4,453

$   4,390

1 %

13 %

Non-interest income

1,411

1,498

1,445

1,431

1,298

(6)

9

Total net revenue

6,383

6,438

6,272

5,884

5,688

(1)

12

Provision for credit losses

2,157

2,238

1,861

1,995

2,174

(4)

(1)

Non-interest expense

3,025

3,186

2,810

2,805

2,847

(5)

6

Income from continuing operations before income taxes

1,201

1,014

1,601

1,084

667

18

80

Income tax provision

283

239

378

256

157

18

80

Income from continuing operations, net of tax

$      918

$      775

$   1,223

$      828

$      510

18

80

Selected performance metrics:

Period-end loans held for investment

$  143,861

$ 147,666

$ 140,320

$ 135,975

$ 130,980

(3)

10

Average loans held for investment

142,887

142,112

137,500

132,505

128,562

1

11

Average yield on loans outstanding(1)

18.76 %

18.88 %

18.96 %

18.07 %

17.88 %

(12) bps

88 bps

Total net revenue margin(8)

17.82

18.07

18.24

17.76

17.70

(25)

12

Net charge-off rate(3)

5.94

5.35

4.40

4.38

4.04

59

190

30+ day performing delinquency rate

4.48

4.61

4.31

3.74

3.66

(13)

82

Purchase volume(9)

$  146,696

$ 158,290

$ 154,880

$ 154,184

$ 138,310

(7) %

6 %

Refreshed FICO scores:(10)

Greater than 660

68 %

68 %

69 %

69 %

68 %

—

—

660 or below

32

32

31

31

32

—

—

Total

100 %

100 %

100 %

100 %

100 %

 

CAPITAL ONE FINANCIAL CORPORATION (COF)

Table 11: Financial & Statistical Summary—Consumer Banking Business

2024 Q1 vs

(Dollars in millions, except as noted)

2024

Q1

2023

Q4

2023

Q3

2023

Q2

2023

Q1

2023

Q4

2023

Q1

Consumer Banking

Earnings:

Net interest income

$    2,011

$   1,951

$   2,133

$   2,269

$   2,360

3 %

(15) %

Non-interest income

159

163

142

149

135

(2)

18

Total net revenue

2,170

2,114

2,275

2,418

2,495

3

(13)

Provision for credit losses

426

422

213

259

275

1

55

Non-interest expense

1,246

1,402

1,262

1,231

1,283

(11)

(3)

Income from continuing operations before income taxes

498

290

800

928

937

72

(47)

Income tax provision

117

68

189

219

221

72

(47)

Income from continuing operations, net of tax

$      381

$      222

$      611

$      709

$      716

72

(47)

Selected performance metrics:

Period-end loans held for investment

$    75,099

$   75,437

$   76,844

$   77,280

$   78,151

—

(4)

Average loans held for investment

75,092

76,238

77,154

77,698

78,994

(2)

(5)

Average yield on loans held for investment(1)

8.33 %

8.17 %

7.97 %

7.65 %

7.40 %

16 bps

93 bps

Auto loan originations

$      7,522

$     6,157

$     7,452

$     7,160

$     6,211

22 %

21 %

Period-end deposits

300,806

296,171

290,789

286,174

291,163

2

3

Average deposits

294,448

291,486

287,457

285,647

278,772

1

6

Average deposits interest rate

3.15 %

3.06 %

2.85 %

2.46 %

1.96 %

9 bps

119 bps

Net charge-off rate

2.03

2.25

1.81

1.43

1.56

(22)

47

30+ day performing delinquency rate

5.21

6.25

5.55

5.30

4.92

(104)

29

30+ day delinquency rate

5.86

7.08

6.27

5.95

5.46

(122)

40

Nonperforming loan rate(4)

0.83

1.00

0.89

0.82

0.72

(17)

11

Nonperforming asset rate(5)

0.91

1.09

0.96

0.88

0.78

(18)

13

Auto—At origination FICO scores:(11)

Greater than 660

53 %

53 %

52 %

52 %

52 %

—

1 %

621 - 660

20

20

20

20

20

—

—

620 or below

27

27

28

28

28

—

(1)

Total

100 %

100 %

100 %

100 %

100 %

 

CAPITAL ONE FINANCIAL CORPORATION (COF)

Table 12: Financial & Statistical Summary—Commercial Banking Business

2024 Q1 vs

(Dollars in millions, except as noted)

2024

Q1

2023

Q4

2023

Q3

2023

Q2

2023

Q1

2023

Q4

2023

Q1

Commercial Banking

Earnings:

Net interest income

$      599

$      617

$      621

$      632

$      648

(3) %

(8) %

Non-interest income

281

245

288

257

212

15

33

Total net revenue(7)

880

862

909

889

860

2

2

Provision (benefit) for credit losses

(2)

84

116

146

259

**

**

Non-interest expense

515

487

512

482

530

6

(3)

Income from continuing operations before income taxes

367

291

281

261

71

26

**

Income tax provision

87

68

67

61

17

28

**

Income from continuing operations, net of tax

$      280

$      223

$      214

$      200

$        54

26

**

Selected performance metrics:

Period-end loans held for investment

$    89,461

$   90,488

$   91,153

$   91,552

$   93,543

(1)

(4)

Average loans held for investment

89,877

91,025

91,556

93,195

94,092

(1)

(4)

Average yield on loans held for investment(1)(7)

7.14 %

7.24 %

7.16 %

6.75 %

6.31 %

(10) bps

83 bps

Period-end deposits

$    31,082

$   32,712

$   36,035

$   36,793

$   38,380

(5) %

(19) %

Average deposits

31,844

34,525

37,279

37,960

39,941

(8)

(20)

Average deposits interest rate

2.65 %

2.79 %

2.93 %

2.68 %

2.34 %

(14) bps

31 bps

Net charge-off rate

0.13

0.53

0.25

1.62

0.09

(40)

4

Nonperforming loan rate(4)

1.28

0.84

0.90

0.89

0.79

44

49

Nonperforming asset rate(5)

1.28

0.84

0.90

0.89

0.79

44

49

Risk category:(12)

Noncriticized

$    80,804

$   81,758

$   82,968

$   84,583

$   85,964

(1) %

(6) %

Criticized performing

7,509

7,969

7,363

6,158

6,839

(6)

10

Criticized nonperforming

1,148

761

822

811

740

51

55

Total commercial banking loans held for investment

$    89,461

$   90,488

$   91,153

$   91,552

$   93,543

(1)

(4)

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

Noncriticized

90.33 %

90.35 %

91.02 %

92.38 %

91.90 %

(2) bps

(157) bps

Criticized performing

8.39

8.81

8.08

6.73

7.31

(42)

108

Criticized nonperforming

1.28

0.84

0.90

0.89

0.79

44

49

Total commercial banking loans

100.00 %

100.00 %

100.00 %

100.00 %

100.00 %

 

CAPITAL ONE FINANCIAL CORPORATION (COF)

Table 13: Financial & Statistical Summary—Other and Total

2024 Q1 vs

(Dollars in millions)

2024

Q1

2023

Q4

2023

Q3

2023

Q2

2023

Q1

2023

Q4

2023

Q1

Other

Earnings:

Net interest loss

$      (394)

$     (280)

$     (445)

$     (515)

$     (479)

41 %

(18) %

Non-interest income (loss)

(2)

14

—

(6)

7

**

**

Total net loss(7)

(396)

(266)

(445)

(521)

(472)

49

(16)

Provision (benefit) for credit losses

—

(2)

2

1

—

**

—

Non-interest expense(13)

147

411

71

61

94

(64)

56

Loss from continuing operations before income taxes

(543)

(675)

(518)

(583)

(566)

(20)

(4)

Income tax benefit

(201)

(151)

(217)

(248)

(207)

33

(3)

Loss from continuing operations, net of tax

$      (342)

$     (524)

$     (301)

$     (335)

$     (359)

(35)

(5)

Selected performance metrics:

Period-end deposits

$      19,081

$     19,530

$     19,187

$     20,738

$     20,284

(2)

(6)

Average deposits

19,365

19,317

20,277

20,071

21,410

—

(10)

Total

Earnings:

Net interest income

$       7,488

$      7,519

$      7,423

$      7,113

$      7,186

—

4 %

Non-interest income

1,914

1,987

1,943

1,899

1,717

(4) %

11

Total net revenue

9,402

9,506

9,366

9,012

8,903

(1)

6

Provision for credit losses

2,683

2,857

2,284

2,490

2,795

(6)

(4)

Non-interest expense

5,137

5,717

4,860

4,794

4,945

(10)

4

Income from continuing operations before income taxes

1,582

932

2,222

1,728

1,163

70

36

Income tax provision

302

226

432

297

203

34

49

Income from continuing operations, net of tax

$       1,280

$         706

$      1,790

$      1,431

$         960

81

33

Selected performance metrics:

Period-end loans held for investment

$    315,154

$   320,472

$   314,780

$   311,323

$   308,836

(2)

2

Average loans held for investment

314,614

315,890

312,759

309,655

307,756

—

2

Period-end deposits

350,969

348,413

346,011

343,705

349,827

1

—

Average deposits

345,657

345,328

345,013

343,678

340,123

—

2

 

CAPITAL ONE FINANCIAL CORPORATION (COF)

Table 14: Notes to Net Interest Margin, Loan, Allowance and Business Segment Disclosures (Tables 6—13)

(1)

Average yield is calculated based on annualized interest income for the period divided by average loans during the period. Annualized interest income does not include any allocations, such as funds transfer pricing. Average yield is calculated using whole dollar values for average balances and interest income/expense. Accordingly, total interest earning assets less total interest bearing liabilities may not total net interest income/spread.

(2)

Includes amounts related to entities that provide capital to low-income and rural communities of $1.9 billion and $1.7 billion for the first quarters of 2024 and 2023, respectively, and related interest expense of $8 million for both the first quarters of 2024 and 2023.

(3)

In December 2023, we recognized $18 million of incremental net charge-offs on certain loans in hardship programs from the one-time impact of operational delays, which increased the Q4 2023 net charge-off rate by approximately 5 basis points. Excluding this impact, the Q4 2023 net charge-off rate would have been 5.30%.

(4)

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. For Commercial Banking, loans categorized as nonperforming are considered criticized nonperforming.

(5)

Nonperforming assets consist of nonperforming loans, repossessed assets and other foreclosed assets. The total nonperforming asset rate is calculated based on total nonperforming assets divided by the combined period-end total loans held for investment, repossessed assets and other foreclosed assets.

(6)

Primarily represents foreign currency translation adjustments.

(7)

Some of our commercial investments generate tax-exempt income, tax credits or other tax benefits. Accordingly, we present our Commercial Banking revenue and yields on a taxable-equivalent basis, calculated using the federal statutory tax rate of 21% and state taxes where applicable, with offsetting reductions to the Other category.

(8)

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

(9)

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

(10)

Percentages represent period-end loans held for investment in each credit score category. Domestic Card credit scores generally represent FICO scores. These scores are obtained from one of the major credit bureaus at origination and are refreshed monthly thereafter. We approximate non-FICO credit scores to comparable FICO scores for consistency purposes. Balances for which no credit score is available or the credit score is invalid are included in the 660 or below category. 

(11)

Percentages represent period-end loans held for investment in each credit score category. Auto credit scores generally represent average FICO scores obtained from three credit bureaus at the time of application and are not refreshed thereafter. Balances for which no credit score is available or the credit score is invalid are included in the 620 or below category.

(12)

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

(13)

Includes the impact of the $42 million and $289 millionFDIC special assessment in Q1 2024 and Q4 2023, respectively, and any charges incurred as a result of restructuring activities for the periods presented.

**

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)

March 31,

2024

December 31,

2023

September 30,

2023

June 30,

2023

March 31,

2023

Regulatory Capital Metrics

Common equity excluding AOCI

$        63,088

$        62,710

$        62,245

$         60,729

$        59,546

Adjustments:

AOCI, net of tax(2)

14

27

(9)

31

(3)

Goodwill, net of related deferred tax liabilities

(14,804)

(14,811)

(14,797)

(14,813)

(14,538)

Other Intangible and deferred tax assets, net of deferred tax liabilities

(291)

(311)

(333)

(358)

(371)

Common equity Tier 1 capital

$        48,007

$        47,615

$        47,106

$         45,589

$        44,634

Tier 1 capital

$        52,852

$        52,460

$        51,952

$         50,434

$        49,479

Total capital(3)

59,483

59,124

58,844

57,607

56,611

Risk-weighted assets

366,046

369,206

362,962

359,613

356,079

Adjusted average assets(4)

468,030

467,553

464,286

459,732

455,477

Capital Ratios

Common equity Tier 1 capital(5)

13.1 %

12.9 %

13.0 %

12.7 %

12.5 %

Tier 1 capital(6)

14.4

14.2

14.3

14.0

13.9

Total capital(7)

16.3

16.0

16.2

16.0

15.9

Tier 1 leverage(4)

11.3

11.2

11.2

11.0

10.9

TCE(8)

8.1

8.2

7.3

7.6

7.6

 

Reconciliation of Non-GAAP Measures

The following non-GAAP measures consist of our adjusted results that we believe help investors and users of our financial information understand the effect of adjusting items on our selected reported results, however, they may not be comparable to similarly-titled measures reported by other companies. These adjusted results provide alternate measurements of our operating performance, both for the current period and trends across multiple periods. The following tables present reconciliations of these non-GAAP measures to the applicable amounts measured in accordance with GAAP.

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

2024

Q1

2023

Q4

2023

Q3

2023

Q2

2023

Q1

Adjusted diluted earnings per share ("EPS"):

Net income available to common stockholders (GAAP)

$        1,200

$          639

$        1,705

$           1,351

$              887

FDIC special assessment

42

289

—

—

—

Adjusted net income available to common stockholders before income tax impacts (non-GAAP)

1,242

928

1,705

1,351

887

Income tax impacts

(10)

(70)

—

—

—

Adjusted net income available to common stockholders (non-GAAP)

$        1,232

$          858

$        1,705

$           1,351

$              887

Diluted weighted-average common shares outstanding (in millions) (GAAP)

383.4

382.8

383.3

383.7

383.8

Diluted EPS (GAAP)

$          3.13

$         1.67

$       4.45

$          3.52

$          2.31

Impact of adjustments noted above

0.08

0.57

—

—

—

Adjusted diluted EPS (non-GAAP)

$          3.21

$         2.24

$       4.45

$          3.52

$          2.31

Adjusted efficiency ratio:

Non-interest expense (GAAP)

$        5,137

$          5,717

$        4,860

$           4,794

$           4,945

FDIC special assessment

(42)

(289)

—

—

—

Adjusted non-interest expense (non-GAAP)

$        5,095

$          5,428

$        4,860

$           4,794

$           4,945

Total net revenue (GAAP)

$        9,402

$          9,506

$        9,366

$           9,012

$           8,903

Efficiency ratio (GAAP)

54.64 %

60.14 %

51.89 %

53.20 %

55.54 %

Impact of adjustments noted above

          (45) bps

       (304) bps

—

—

—

Adjusted efficiency ratio (non-GAAP)

54.19 %

57.10 %

51.89 %

53.20 %

55.54 %

Adjusted operating efficiency ratio:

Operating expense (GAAP)

$        4,127

$          4,463

$        3,888

$           3,908

$           4,048

FDIC special assessment

(42)

(289)

—

—

—

Adjusted operating expense (non-GAAP)

$        4,085

$          4,174

$        3,888

$           3,908

$           4,048

Total net revenue (GAAP)

$        9,402

$          9,506

$        9,366

$           9,012

$           8,903

Operating efficiency ratio (GAAP)

43.89 %

46.95 %

41.51 %

43.36 %

45.47 %

Impact of adjustments noted above

          (44) bps

       (304) bps

—

—

—

Adjusted operating efficiency ratio (non-GAAP)

43.45 %

43.91 %

41.51 %

43.36 %

45.47 %

 

Reconciliation of Non-GAAP Measures

The following summarizes our non-GAAP measures. While these non-GAAP measures are widely used by investors, analysts and bank regulatory agencies to assess the operating performance and capital position of financial services companies, they may not be comparable to similarly-titled measures reported by other companies. The following table presents reconciliations of these non-GAAP measures to the applicable amounts measured in accordance with GAAP. 

(Dollars in millions)

2024

Q1

2023

Q4

2023

Q3

2023

Q2

2023

Q1

Pre- Provision Earnings

Total net revenue

$        9,402

$         9,506

$         9,366

$         9,012

$         8,903

Non-interest expense

(5,137)

(5,717)

(4,860)

(4,794)

(4,945)

Pre-provision earnings(9)

$        4,265

$         3,789

$         4,506

$         4,218

$         3,958

Tangible Common Equity (Period-End)

Stockholders' equity

$      57,801

$       58,089

$       53,668

$       54,559

$       54,653

Goodwill and other intangible assets(10)

(15,257)

(15,289)

(15,308)

(15,356)

(15,098)

Noncumulative perpetual preferred stock

(4,845)

(4,845)

(4,845)

(4,845)

(4,845)

Tangible common equity(11)

$      37,699

$       37,955

$       33,515

$       34,358

$       34,710

Tangible Common Equity (Average)

Stockholders' equity

$      57,998

$       55,632

$       55,012

$       55,357

$       54,773

Goodwill and other intangible assets(10)

(15,280)

(15,304)

(15,348)

(15,187)

(14,984)

Noncumulative perpetual preferred stock

(4,845)

(4,845)

(4,845)

(4,845)

(4,845)

Tangible common equity(11)

$      37,873

$       35,483

$       34,819

$       35,325

$       34,944

Return on Tangible Common Equity (Average)

Net income available to common stockholders

$        1,200

$           639

$         1,705

$         1,351

$           887

Tangible common equity (Average)

37,873

35,483

34,819

35,325

34,944

Return on tangible common equity(11)(12)

12.67 %

7.20 %

19.59 %

15.30 %

10.15 %

Tangible Assets (Period-End)

Total assets

$     481,720

$     478,464

$     471,435

$     467,800

$     471,660

Goodwill and other intangible assets(10)

(15,257)

(15,289)

(15,308)

(15,356)

(15,098)

Tangible assets(11)

$     466,463

$     463,175

$     456,127

$     452,444

$     456,562

(Dollars in millions)

2024

Q1

2023

Q4

2023

Q3

2023

Q2

2023

Q1

Tangible Assets (Average)

Total assets

$     474,995

$     472,594

$     469,860

$     466,652

$     462,324

Goodwill and other intangible assets(10)

(15,280)

(15,304)

(15,348)

(15,187)

(14,984)

Tangible assets(11)

$     459,715

$     457,290

$     454,512

$     451,465

$     447,340

Return on Tangible Assets (Average)

Net income

$        1,280

$           706

$         1,790

$         1,431

$           960

Tangible Assets (Average)

459,715

457,290

454,512

451,465

447,340

Return on tangible assets(11)(13)

1.11 %

0.62 %

1.58 %

1.27 %

0.86 %

TCE Ratio

Tangible common equity (Period-end)

$      37,699

$       37,955

$       33,515

$       34,358

$       34,710

Tangible Assets (Period-end)

466,463

463,175

456,127

452,444

456,562

TCE Ratio(11)

8.1 %

8.2 %

7.3 %

7.6 %

7.6 %

Tangible Book Value per Common Share

Tangible common equity (Period-end)

$      37,699

$       37,955

$       33,515

$       34,358

$       34,710

Outstanding Common Shares

382.1

380.4

381.0

381.4

382.0

Tangible book value per common share(11)

$        98.67

$         99.78

$         87.97

$         90.07

$         90.86

__________

(1)

Regulatory capital metrics and capital ratios as of March 31, 2024 are preliminary and therefore subject to change.      

(2)

Excludes certain components of AOCI in accordance with rules applicable to Category III institutions.

(3)

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

(4)

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

(5)

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

(6)

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

(7)

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

(8)

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

(9)

Management believes that this financial metric is useful in assessing the ability of a lending institution to generate income in excess of its provision for credit losses.

(10)

Includes impact of related deferred taxes.

(11)

Management believes that this financial metric is useful in assessing capital adequacy and the level of returns generated.

(12)

Return on average tangible common equity is a non-GAAP measure calculated based on annualized net income (loss) available to common stockholders less annualized income (loss) from discontinued operations, net of tax, for the period, divided by average TCE.

(13)

Return on average tangible assets is a non-GAAP measure calculated based on annualized income (loss) from continuing operations, net of tax, for the period divided by average tangible assets for the period.

 

Cision View original content:https://www.prnewswire.com/news-releases/capital-one-reports-first-quarter-2024-net-income-of-1-3-billion-or-3-13-per-share-302127955.html

SOURCE Capital One Financial Corporation