Capital One Reports Fourth Quarter 2022 Net Income of $1.2 billion, or $3.03 per share
01/24/2023 - 04:05 PM
Net of adjusting items, Fourth Quarter 2022 Net Income of $2.82 per share(1)
MCLEAN, Va. , Jan. 24, 2023 /PRNewswire/ -- Capital One Financial Corporation (NYSE: COF) today announced net income for the fourth quarter of 2022 of $1.2 billion , or $3.03 per diluted common share, compared with net income of $1 .7 billion, or $4.20 per diluted common share in the third quarter of 2022, and with net income of $2 .4 billion, or $5.41 per diluted common share in the fourth quarter of 2021. Adjusted net income(1) for the Fourth Quarter of 2022 was $2.82 per diluted common share.
"We posted strong top line growth throughout 2022," said Richard D. Fairbank , Founder, Chairman, and Chief Executive Officer. "As a result of our investments to transform our technology and to drive resilient growth, we're in a strong position to deliver compelling long-term shareholder value and thrive in a broad range of possible economic scenarios."
The quarter included the following adjusting items that increase/(decrease) earnings:
(Dollars in millions, except per share data)
Pre-Tax
Impact
After-Tax Diluted EPS
Impact
Insurance recoveries and legal reserve activity
$ (177)
$ (0.35)
Restructuring Charges
$ 72
$ 0.14
All comparisons below are for the fourth quarter of 2022 compared with the third quarter of 2022 unless otherwise noted.
(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 Table 15 in Exhibit 99.2 for a reconciliation of our selected reported results to these non-GAAP measures.
Fourth Quarter 2022 Income Statement Summary:
Total net revenue increased 3 percent to $9.0 billion . Total non-interest expense increased 3 percent to $5.1 billion : 14 percent increase in marketing. less than 1 percent decrease in operating expenses. Pre-provision earnings(1) increased 3 percent to $4.0 billion . Provision for credit losses increased $747 million to $2.4 billion : Net charge-offs of $1.4 billion . $1.0 billion loan reserve build.Net interest margin of 6.84 percent, an increase of 4 basis points. Efficiency ratio of 56.19 percent. Adjusted efficiency ratio(2) of 57.36 percent. Operating efficiency ratio of 43.83 percent. Adjusted operating efficiency ratio(2) of 44.99 percent. Fourth Quarter 2022 Balance Sheet Summary:
Common equity Tier 1 capital ratio under Basel III Standardized Approach of 12.5 percent at December 31, 2022 . Period-end loans held for investment in the quarter increased $8.4 billion , or 3 percent, to $312.3 billion . Credit Card period-end loans increased $10.8 billion , or 9 percent, to $137.7 billion . Domestic Card period-end loans increased $10.3 billion , or 8 percent, to $131.6 billion . Consumer Banking period-end loans decreased $1.3 billion , or 2 percent, to $79.9 billion . Auto period-end loans decreased $1.2 billion , or 2 percent, to $78.4 billion . Commercial Banking period-end loans decreased $1.2 billion , or 1 percent, to $94.7 billion . Average loans held for investment in the quarter increased $6.7 billion , or 2 percent, to $306.9 billion . Credit Card average loans increased $7.3 billion , or 6 percent, to $130.7 billion . Domestic Card average loans increased $7.3 billion , or 6 percent, to $124.8 billion . Consumer Banking average loans decreased $639 million , or 1 percent, to $80.7 billion . Auto average loans decreased $633 million , or 1 percent, to $79.1 billion . Commercial Banking average loans increased $39 million , or less than 1 percent, to $95.5 billion . Period-end total deposits increased $15.8 billion , or 5 percent, to $333.0 billion , while average deposits increased $14.6 billion , or 5 percent, to $326.6 billion . Interest-bearing deposits rate paid increased 82 basis points to 1.82 percent. 2022 Full Year Income Statement Summary:
Total net revenue increased 13% to $34.3 billion . Total non-interest expense increased 16 percent to $19.2 billion : 40 percent increase in marketing. 11 percent increase in operating expenses. Pre-provision earnings(1) increased 9 percent to $15.1 billion . Provision for credit losses increased $7.8 billion to $5.8 billion . Net interest margin of 6.67 percent, an increase of 46 basis points. Efficiency ratio of 55.95 percent. Adjusted efficiency ratio(2) of 56.26 percent. Operating efficiency ratio of 44.22 percent. Adjusted operating efficiency ratio(2) of 44.53 percent.
(1) Pre-provision earnings is calculated based on the sum of net interest income and non-interest income, less non-interest expense for the period. Management believes that this financial metric is useful in enabling investors and others to assess the Company's ability to generate income to cover credit losses through a credit cycle, which can vary significantly between periods.
(2) 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 Table 15 in Exhibit 99.2 for a reconciliation of our selected reported results to these non-GAAP measures.
Earnings Conference Call Webcast Information
The company will hold an earnings conference call on January 24, 2023 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 February 7, 2023 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, 2021 .
About Capital One
Capital One Financial Corporation (www.capitalone.com ) is a financial holding company which, along with its subsidiaries, had $333.0 billion in deposits and $455.2 billion in total assets as of December 31, 2022 . 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)
Fourth Quarter 2022
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 Annual Report on Form 10-K for the period ended December 31, 2022 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
2022 Q4 vs
Year Ended December 31,
(Dollars in millions, except per share data and as noted)
2022
Q4
2022
Q3
2022
Q2
2022
Q1
2021
Q4
2022
Q3
2021
Q4
2022
2021
2022 vs.
2021
Income Statement
Net interest income
$ 7,197
$ 7,003
$ 6,517
$ 6,397
$ 6,450
3 %
12 %
$ 27,114
$ 24,171
12 %
Non-interest income
1,843
1,802
1,715
1,776
1,668
2
10
7,136
6,264
14
Total net revenue(1)
9,040
8,805
8,232
8,173
8,118
3
11
34,250
30,435
13
Provision (benefit) for credit losses
2,416
1,669
1,085
677
381
45
**
5,847
(1,944)
**
Non-interest expense:
Marketing
1,118
978
1,003
918
999
14
12
4,017
2,871
40
Operating expense
3,962
3,971
3,580
3,633
3,679
—
8
15,146
13,699
11
Total non-interest expense
5,080
4,949
4,583
4,551
4,678
3
9
19,163
16,570
16
Income from continuing operations before income taxes
1,544
2,187
2,564
2,945
3,059
(29)
(50)
9,240
15,809
(42)
Income tax provision
312
493
533
542
633
(37)
(51)
1,880
3,415
(45)
Income from continuing operations, net of tax
1,232
1,694
2,031
2,403
2,426
(27)
(49)
7,360
12,394
(41)
Income (loss) from discontinued operations, net of tax
—
—
—
—
(1)
—
**
—
(4)
**
Net income
1,232
1,694
2,031
2,403
2,425
(27)
(49)
7,360
12,390
(41)
Dividends and undistributed earnings allocated to participating securities(2)
(14)
(21)
(25)
(28)
(21)
(33)
(33)
(88)
(105)
(16)
Preferred stock dividends
(57)
(57)
(57)
(57)
(74)
—
(23)
(228)
(274)
(17)
Issuance cost for redeemed preferred stock(3)
—
—
—
—
(34)
—
**
—
(46)
**
Net income available to common stockholders
$ 1,161
$ 1,616
$ 1,949
$ 2,318
$ 2,296
(28)
(49)
$ 7,044
$ 11,965
(41)
Common Share Statistics
Basic earnings per common share:(2)
Net income from continuing operations
$ 3.03
$ 4.21
$ 4.98
$ 5.65
$ 5.43
(28) %
(44) %
$ 17.98
$ 27.05
(34) %
Income (loss) from discontinued operations
—
—
—
—
—
—
—
—
(0.01)
**
Net income per basic common share
$ 3.03
$ 4.21
$ 4.98
$ 5.65
$ 5.43
(28)
(44)
$ 17.98
$ 27.04
(34)
Diluted earnings per common share:(2)
Net income from continuing operations
$ 3.03
$ 4.20
$ 4.96
$ 5.62
$ 5.41
(28) %
(44) %
$ 17.91
$ 26.95
(34) %
Income (loss) from discontinued operations
—
—
—
—
—
—
—
—
(0.01)
**
Net income per diluted common share
$ 3.03
$ 4.20
$ 4.96
$ 5.62
$ 5.41
(28)
(44)
$ 17.91
$ 26.94
(34)
Weighted-average common shares outstanding (in millions):
Basic
382.6
383.4
391.2
410.4
422.5
—
(9) %
391.8
442.5
(11) %
Diluted
383.7
384.6
392.6
412.2
424.3
—
(10)
393.2
444.2
(11)
Common shares outstanding (period-end, in millions)
381.3
382.0
383.8
399.0
413.9
—
(8)
381.3
413.9
(8)
Dividends declared and paid per common share
$ 0.60
$ 0.60
$ 0.60
$ 0.60
$ 0.60
—
—
$ 2.40
$ 2.60
(8)
Tangible book value per common share (period-end)(4)
86.11
81.38
87.84
91.77
99.74
6 %
(14)
86.11
99.74
(14)
2022 Q4 vs
Year Ended December 31,
(Dollars in millions)
2022
Q4
2022
Q3
2022
Q2
2022
Q1
2021
Q4
2022
Q3
2021
Q4
2022
2021
2022 vs.
2021
Balance Sheet (Period-End)
Loans held for investment
$ 312,331
$ 303,943
$ 296,384
$ 280,466
$ 277,340
3 %
13 %
$ 312,331
$ 277,340
13 %
Interest-earning assets
427,248
415,262
406,565
398,241
397,341
3
8
427,248
397,341
8
Total assets
455,249
444,232
440,288
434,195
432,381
2
5
455,249
432,381
5
Interest-bearing deposits
300,789
282,802
270,881
275,648
272,937
6
10
300,789
272,937
10
Total deposits
332,992
317,193
307,885
313,429
310,980
5
7
332,992
310,980
7
Borrowings
48,715
54,607
58,938
45,358
43,086
(11)
13
48,715
43,086
13
Common equity
47,737
46,015
48,564
51,499
56,184
4
(15)
47,737
56,184
(15)
Total stockholders' equity
52,582
50,861
53,410
56,345
61,029
3
(14)
52,582
61,029
(14)
Balance Sheet (Average Balances)
Loans held for investment
$ 306,881
$ 300,186
$ 286,110
$ 275,342
$ 267,159
2 %
15 %
$ 292,238
$ 252,730
16 %
Interest-earning assets
421,051
412,171
398,934
394,082
390,868
2
8
406,646
389,336
4
Total assets
449,659
447,088
435,327
430,372
427,845
1
5
440,538
424,521
4
Interest-bearing deposits
292,793
275,900
268,104
271,823
269,951
6
8
277,208
271,500
2
Total deposits
326,558
311,928
305,954
309,597
307,272
5
6
313,551
306,397
2
Borrowings
49,747
58,628
53,208
42,277
39,943
(15)
25
51,006
38,590
32
Common equity
47,594
49,696
49,319
54,591
56,946
(4)
(16)
50,279
56,966
(12)
Total stockholders' equity
52,439
54,541
54,165
59,437
62,498
(4)
(16)
55,125
62,556
(12)
CAPITAL ONE FINANCIAL CORPORATION (COF)
Table 2: Selected Metrics—Consolidated
2022 Q4 vs
Year Ended December 31,
(Dollars in millions, except as noted)
2022
Q4
2022
Q3
2022
Q2
2022
Q1
2021
Q4
2022
Q3
2021
Q4
2022
2021
2022 vs.
2021
Performance Metrics
Net interest income growth (period over period)
3 %
7 %
2 %
(1 %)
5 %
**
**
12 %
5 %
**
Non-interest income growth (period over period)
2
5
(3)
6
—
**
**
14
12
**
Total net revenue growth (period over period)
3
7
1
1
4
**
**
13
7
**
Total net revenue margin(5)
8.59
8.55
8.25
8.30
8.31
4 bps
28 bps
8.42
7.82
60 bps
Net interest margin(6)
6.84
6.80
6.54
6.49
6.60
4
24
6.67
6.21
46
Return on average assets
1.10
1.52
1.87
2.23
2.27
(42)
(117)
1.67
2.92
(125)
Return on average tangible assets(7)
1.13
1.57
1.93
2.31
2.35
(44)
(122)
1.73
3.03
(130)
Return on average common equity(8)
9.76
13.01
15.81
16.98
16.13
(325)
(6) %
14.01
21.01
(7) %
Return on average tangible common equity(9)
14.22
18.59
22.63
23.36
21.82
(4) %
(8)
19.91
28.39
(8)
Efficiency ratio(10)
56.19
56.21
55.67
55.68
57.63
(2) bps
(144) bps
55.95
54.44
151 bps
Operating efficiency ratio(11)
43.83
45.10
43.49
44.45
45.32
(127)
(149)
44.22
45.01
(79)
Effective income tax rate for continuing operations
20.2
22.5
20.8
18.4
20.7
(230)
(50)
20.3
21.6
(130)
Employees (period-end, in thousands)
56.0
55.1
53.6
51.5
50.8
2 %
10 %
56.0
50.8
10 %
Credit Quality Metrics
Allowance for credit losses
$ 13,240
$ 12,209
$ 11,491
$ 11,308
$ 11,430
8 %
16 %
$ 13,240
$ 11,430
16 %
Allowance coverage ratio
4.24 %
4.02 %
3.88 %
4.03 %
4.12 %
22 bps
12 bps
4.24 %
4.12 %
12 bps
Net charge-offs
$ 1,430
$ 931
$ 845
$ 767
$ 527
54 %
171 %
$ 3,973
$ 2,234
78 %
Net charge-off rate(12)
1.86 %
1.24 %
1.18 %
1.11 %
0.79 %
62 bps
107 bps
1.36 %
0.88 %
48 bps
30+ day performing delinquency rate
2.96
2.58
2.36
2.08
2.25
38
71
2.96
2.25
71
30+ day delinquency rate
3.21
2.78
2.54
2.21
2.41
43
80
3.21
2.41
80
Capital Ratios(13)
Common equity Tier 1 capital
12.5 %
12.2 %
12.1 %
12.7 %
13.1 %
30 bps
(60) bps
12.5 %
13.1 %
(60) bps
Tier 1 capital
13.9
13.6
13.5
14.1
14.5
30
(60)
13.9
14.5
(60)
Total capital
15.8
15.7
15.7
16.4
16.9
10
(110)
15.8
16.9
(110)
Tier 1 leverage
11.1
11.0
11.1
11.3
11.6
10
(50)
11.1
11.6
(50)
Tangible common equity ("TCE")(14)
7.5
7.2
7.9
8.7
9.9
30
(240)
7.5
9.9
(240)
CAPITAL ONE FINANCIAL CORPORATION (COF)
Table 3: Consolidated Statements of Income
2022 Q4 vs
Year Ended December 31,
(Dollars in millions, except as noted)
2022
Q4
2022
Q3
2022
Q2
2022
Q1
2021
Q4
2022
Q3
2021
Q4
2022
2021
2022 vs.
2021
Interest income:
Loans, including loans held for sale
$ 8,360
$ 7,578
$ 6,605
$ 6,367
$ 6,451
10 %
30 %
$ 28,910
$ 24,263
19 %
Investment securities
548
499
435
402
368
10
49
1,884
1,446
30
Other
250
123
55
15
12
103
**
443
60
**
Total interest income
9,158
8,200
7,095
6,784
6,831
12
34
31,237
25,769
21
Interest expense:
Deposits
1,335
689
293
218
222
94
**
2,535
956
165
Securitized debt obligations
170
120
65
29
30
42
**
384
119
**
Senior and subordinated notes
430
319
194
131
121
35
**
1,074
488
120
Other borrowings
26
69
26
9
8
(62)
**
130
35
**
Total interest expense
1,961
1,197
578
387
381
64
**
4,123
1,598
158
Net interest income
7,197
7,003
6,517
6,397
6,450
3
12
27,114
24,171
12
Provision (benefit) for credit losses
2,416
1,669
1,085
677
381
45
**
5,847
(1,944)
**
Net interest income after provision for credit losses
4,781
5,334
5,432
5,720
6,069
(10)
(21)
21,267
26,115
(19)
Non-interest income:
Interchange fees, net
1,177
1,195
1,201
1,033
1,005
(2)
17
4,606
3,860
19
Service charges and other customer-related fees
395
415
415
400
435
(5)
(9)
1,625
1,578
3
Other
271
192
99
343
228
41
19
905
826
10
Total non-interest income
1,843
1,802
1,715
1,776
1,668
2
10
7,136
6,264
14
Non-interest expense:
Salaries and associate benefits
2,266
2,187
1,946
2,026
1,941
4
17
8,425
7,421
14
Occupancy and equipment
554
502
481
513
527
10
5
2,050
2,003
2
Marketing
1,118
978
1,003
918
999
14
12
4,017
2,871
40
Professional services
481
471
458
397
449
2
7
1,807
1,440
25
Communications and data processing
352
349
339
339
326
1
8
1,379
1,262
9
Amortization of intangibles
25
17
14
14
13
47
92
70
29
141
Other
284
445
342
344
423
(36)
(33)
1,415
1,544
(8)
Total non-interest expense
5,080
4,949
4,583
4,551
4,678
3
9
19,163
16,570
16
Income from continuing operations before income taxes
1,544
2,187
2,564
2,945
3,059
(29)
(50)
9,240
15,809
(42)
Income tax provision
312
493
533
542
633
(37)
(51)
1,880
3,415
(45)
Income from continuing operations, net of tax
1,232
1,694
2,031
2,403
2,426
(27)
(49)
7,360
12,394
(41)
Income (loss) from discontinued operations, net of tax
—
—
—
—
(1)
—
**
—
(4)
**
Net income
1,232
1,694
2,031
2,403
2,425
(27)
(49)
7,360
12,390
(41)
Dividends and undistributed earnings allocated to participating securities(2)
(14)
(21)
(25)
(28)
(21)
(33)
(33)
(88)
(105)
(16)
Preferred stock dividends
(57)
(57)
(57)
(57)
(74)
—
(23)
(228)
(274)
(17)
Issuance cost for redeemed preferred stock(3)
—
—
—
—
(34)
—
**
—
(46)
**
Net income available to common stockholders
$ 1,161
$ 1,616
$ 1,949
$ 2,318
$ 2,296
(28)
(49)
$ 7,044
$ 11,965
(41)
2022 Q4 vs
Year Ended December 31,
2022
Q4
2022
Q3
2022
Q2
2022
Q1
2021
Q4
2022
Q3
2021
Q4
2022
2021
2022 vs.
2021
Basic earnings per common share:(2)
Net income from continuing operations
$ 3.03
$ 4.21
$ 4.98
$ 5.65
$ 5.43
(28) %
(44) %
$ 17.98
$ 27.05
(34) %
Income (loss) from discontinued operations
—
—
—
—
—
—
—
—
(0.01)
**
Net income per basic common share
$ 3.03
$ 4.21
$ 4.98
$ 5.65
$ 5.43
(28)
(44)
$ 17.98
$ 27.04
(34)
Diluted earnings per common share:(2)
Net income from continuing operations
$ 3.03
$ 4.20
$ 4.96
$ 5.62
$ 5.41
(28)
(44)
$ 17.91
$ 26.95
(34)
Income (loss) from discontinued operations
—
—
—
—
—
—
—
—
(0.01)
**
Net income per diluted common share
$ 3.03
$ 4.20
$ 4.96
$ 5.62
$ 5.41
(28)
(44)
$ 17.91
$ 26.94
(34)
Weighted-average common shares outstanding (in millions):
Basic common shares
382.6
383.4
391.2
410.4
422.5
—
(9)
391.8
442.5
(11)
Diluted common shares
383.7
384.6
392.6
412.2
424.3
—
(10)
393.2
444.2
(11)
CAPITAL ONE FINANCIAL CORPORATION (COF)
Table 4: Consolidated Balance Sheets
2022 Q4 vs
(Dollars in millions)
2022
Q4
2022
Q3
2022
Q2
2022
Q1
2021
Q4
2022
Q3
2021
Q4
Assets:
Cash and cash equivalents:
Cash and due from banks
$ 5,193
$ 3,716
$ 4,825
$ 5,107
$ 4,164
40 %
25 %
Interest-bearing deposits and other short-term investments
25,663
21,176
16,728
21,697
17,582
21
46
Total cash and cash equivalents
30,856
24,892
21,553
26,804
21,746
24
42
Restricted cash for securitization investors
400
399
697
281
308
—
30
Securities available for sale
76,919
75,303
83,022
89,076
95,261
2
(19)
Loans held for investment:
Unsecuritized loans held for investment
283,282
277,576
271,339
257,505
252,468
2
12
Loans held in consolidated trusts
29,049
26,367
25,045
22,961
24,872
10
17
Total loans held for investment
312,331
303,943
296,384
280,466
277,340
3
13
Allowance for credit losses
(13,240)
(12,209)
(11,491)
(11,308)
(11,430)
8
16
Net loans held for investment
299,091
291,734
284,893
269,158
265,910
3
12
Loans held for sale
203
1,729
875
1,155
5,888
(88)
(97)
Premises and equipment, net
4,351
4,265
4,238
4,238
4,210
2
3
Interest receivable
2,104
1,853
1,611
1,479
1,460
14
44
Goodwill
14,777
14,771
14,778
14,784
14,782
—
—
Other assets
26,548
29,286
28,621
27,220
22,816
(9)
16
Total assets
$ 455,249
$ 444,232
$ 440,288
$ 434,195
$ 432,381
2
5
2022 Q4 vs
(Dollars in millions)
2022
Q4
2022
Q3
2022
Q2
2022
Q1
2021
Q4
2022
Q3
2021
Q4
Liabilities:
Interest payable
$ 527
$ 433
$ 333
$ 261
$ 281
22 %
88 %
Deposits:
Non-interest-bearing deposits
32,203
34,391
37,004
37,781
38,043
(6)
(15)
Interest-bearing deposits
300,789
282,802
270,881
275,648
272,937
6
10
Total deposits
332,992
317,193
307,885
313,429
310,980
5
7
Securitized debt obligations
16,973
15,926
17,466
13,740
14,994
7
13
Other debt:
Federal funds purchased and securities loaned or sold under agreements to repurchase
883
528
440
594
820
67
8
Senior and subordinated notes
30,826
30,615
30,489
26,976
27,219
1
13
Other borrowings
33
7,538
10,543
4,048
53
(100)
(38)
Total other debt
31,742
38,681
41,472
31,618
28,092
(18)
13
Other liabilities
20,433
21,138
19,722
18,802
17,005
(3)
20
Total liabilities
402,667
393,371
386,878
377,850
371,352
2
8
Stockholders' equity:
Preferred stock
0
0
0
0
0
—
—
Common stock
7
7
7
7
7
—
—
Additional paid-in capital, net
34,725
34,579
34,425
34,286
34,112
—
2
Retained earnings
57,184
56,240
54,836
53,099
51,006
2
12
Accumulated other comprehensive income (loss)
(9,916)
(10,704)
(6,916)
(4,093)
374
(7)
**
Treasury stock, at cost
(29,418)
(29,261)
(28,942)
(26,954)
(24,470)
1
20
Total stockholders' equity
52,582
50,861
53,410
56,345
61,029
3
(14)
Total liabilities and stockholders' equity
$ 455,249
$ 444,232
$ 440,288
$ 434,195
$ 432,381
2
5
CAPITAL ONE FINANCIAL CORPORATION (COF)
Table 5: Notes to Financial Summary, Selected Metrics and Consolidated Financial Statements (Tables 1—4)
(1)
Total net revenue was reduced by $321 million in Q4 2022, $222 million in Q3 2022, $211 million in Q2 2022, $192 million in Q1 2022 and $151 million in Q4 2021 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)
On September 1, 2021, we redeemed all outstanding shares of our fixed-to-floating rate non-cumulative perpetual preferred stock Series E, which reduced our net income available to common shareholders by $12 million in Q3 2021. On December 1, 2021, we redeemed all outstanding shares of our fixed rate 5.20% non-cumulative perpetual preferred stock Series G and our fixed rate 6.00% non-cumulative perpetual preferred stock Series H, which together reduced our net income available to common shareholders by $34 million in Q4 2021.
(4)
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.
(5)
Total net revenue margin is calculated based on total net revenue for the period divided by average interest-earning assets for the period.
(6)
Net interest margin is calculated based on annualized net interest income for the period divided by average interest-earning assets for the period.
(7)
Return on average tangible assets is a non-GAAP measure calculated based on annualized income (loss) from continuing operations, net of tax, for the period divided by average tangible assets for the period. See "Table 15: Calculation of Regulatory Capital Measures and Reconciliation of Non-GAAP Measures" for additional information on non-GAAP measures.
(8)
Return on average common equity is calculated based on net income (loss) available to common stockholders less income (loss) from discontinued operations, net of tax, for the period, divided by average common equity. Our calculation of return on average common equity may not be comparable to similarly-titled measures reported by other companies.
(9)
Return on average tangible common equity is a non-GAAP measure calculated based on net income (loss) available to common stockholders less income (loss) from discontinued operations, net of tax, for the period, divided by average TCE. See "Table 15: Calculation of Regulatory Capital Measures and Reconciliation of Non-GAAP Measures" for additional information on non-GAAP measures.
(10)
Efficiency ratio is calculated based on total non-interest expense for the period divided by total net revenue for the period. We also provide an adjusted efficiency ratio, which is a non-GAAP measure. See "Table 15: Calculation of Regulatory Capital Measures and Reconciliation of Non-GAAP Measures" for additional information on our non-GAAP measures.
(11)
Operating efficiency ratio is calculated based on operating expense for the period divided by total net revenue for the period. We also provide an adjusted operating efficiency ratio, which is a non-GAAP measure. See "Table 15: Calculation of Regulatory Capital Measures and Reconciliation of Non-GAAP Measures" for additional information on our non-GAAP measures.
(12)
Net charge-off rate is calculated based on annualized net charge-offs for the period divided by average loans held for investment for the period.
(13)
Capital ratios as of the end of Q4 2022 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.
**
Not meaningful.
CAPITAL ONE FINANCIAL CORPORATION (COF)
Table 6: Average Balances, Net Interest Income and Net Interest Margin
2022 Q4
2022 Q3
2021 Q4
(Dollars in millions, except as noted)
Average Balance
Interest Income/ Expense
Yield/Rate(1)
Average Balance
Interest Income/ Expense
Yield/Rate(1)
Average Balance
Interest Income/ Expense
Yield/Rate
Interest-earning assets:
Loans, including loans held for sale
$ 307,852
$ 8,360
10.86 %
$ 300,952
$ 7,578
10.07 %
$ 272,805
$ 6,451
9.46 %
Investment securities
87,110
548
2.52
88,666
499
2.25
96,421
368
1.53
Cash equivalents and other
26,089
250
3.84
22,553
123
2.19
21,642
12
0.22
Total interest-earning assets
$ 421,051
$ 9,158
8.70
$ 412,171
$ 8,200
7.96
$ 390,868
$ 6,831
6.99
Interest-bearing liabilities:
Interest-bearing deposits
$ 292,793
$ 1,335
1.82
$ 275,900
$ 689
1.00
$ 269,951
$ 222
0.33
Securitized debt obligations
16,478
170
4.13
17,108
120
2.81
13,775
30
0.87
Senior and subordinated notes
30,718
430
5.59
30,962
319
4.13
25,454
121
1.90
Other borrowings and liabilities
4,289
26
2.50
12,296
69
2.20
2,279
8
1.50
Total interest-bearing liabilities
$ 344,278
$ 1,961
2.28
$ 336,266
$ 1,197
1.42
$ 311,459
$ 381
0.49
Net interest income/spread
$ 7,197
6.42
$ 7,003
6.53
$ 6,450
6.50
Impact of non-interest-bearing funding
0.42
0.27
0.10
Net interest margin
6.84 %
6.80 %
6.60 %
Year Ended December 31,
2022
2021
(Dollars in millions, except as noted)
Average Balance
Interest Income/ Expense
Yield/Rate(1)
Average Balance
Interest Income/ Expense
Yield/Rate
Interest-earning assets:
Loans, including loans held for sale
$ 293,839
$ 28,910
9.84 %
$ 257,328
$ 24,263
9.43 %
Investment securities
90,608
1,884
2.08
98,394
1,446
1.47
Cash equivalents and other
22,199
443
2.00
33,614
60
0.18
Total interest-earning assets
$ 406,646
$ 31,237
7.68
$ 389,336
$ 25,769
6.62
Interest-bearing liabilities:
Interest-bearing deposits
$ 277,208
$ 2,535
0.91
$ 271,500
$ 956
0.35
Securitized debt obligations
15,603
384
2.46
12,336
119
0.96
Senior and subordinated notes
29,286
1,074
3.67
25,530
488
1.91
Other borrowings and liabilities
7,800
130
1.67
2,261
35
1.57
Total interest-bearing liabilities
$ 329,897
$ 4,123
1.25
$ 311,627
$ 1,598
0.51
Net interest income/spread
$ 27,114
6.43
$ 24,171
6.11
Impact of non-interest-bearing funding
0.24
0.10
Net interest margin
6.67 %
6.21 %
CAPITAL ONE FINANCIAL CORPORATION (COF)
Table 7: Loan Information and Performance Statistics
2022 Q4 vs
Year Ended December 31,
(Dollars in millions, except as noted)
2022
Q4
2022
Q3
2022
Q2
2022
Q1
2021
Q4
2022
Q3
2021
Q4
2022
2021
2022 vs. 2021
Loans Held for Investment (Period-End)
Credit card:
Domestic credit card
$ 131,581
$ 121,279
$ 115,004
$ 107,987
$ 108,723
8 %
21 %
$ 131,581
$ 108,723
21 %
International card businesses
6,149
5,634
5,876
5,975
6,049
9
2
6,149
6,049
2
Total credit card
137,730
126,913
120,880
113,962
114,772
9
20
137,730
114,772
20
Consumer banking:
Auto
78,373
79,580
79,926
78,604
75,779
(2)
3
78,373
75,779
3
Retail banking
1,552
1,619
1,605
1,726
1,867
(4)
(17)
1,552
1,867
(17)
Total consumer banking
79,925
81,199
81,531
80,330
77,646
(2)
3
79,925
77,646
3
Commercial banking:
Commercial and multifamily real estate
37,453
38,225
37,845
34,354
35,262
(2)
6
37,453
35,262
6
Commercial and industrial
57,223
57,606
56,128
51,820
49,660
(1)
15
57,223
49,660
15
Total commercial banking
94,676
95,831
93,973
86,174
84,922
(1)
11
94,676
84,922
11
Total loans held for investment
$ 312,331
$ 303,943
$ 296,384
$ 280,466
$ 277,340
3
13
$ 312,331
$ 277,340
13
Loans Held for Investment (Average)
Credit card:
Domestic credit card
$ 124,816
$ 117,467
$ 109,962
$ 105,536
$ 102,717
6 %
22 %
$ 114,506
$ 95,818
20 %
International card businesses
5,836
5,890
5,873
5,944
5,871
(1)
(1)
5,886
6,913
(15)
Total credit card
130,652
123,357
115,835
111,480
108,588
6
20
120,392
102,731
17
Consumer banking:
Auto
79,108
79,741
79,313
76,892
75,284
(1)
5
78,772
71,108
11
Retail banking
1,592
1,598
1,668
1,797
2,160
—
(26)
1,663
2,765
(40)
Total consumer banking
80,700
81,339
80,981
78,689
77,444
(1)
4
80,435
73,873
9
Commercial banking:
Commercial and multifamily real estate
37,848
38,230
35,754
34,671
33,591
(1)
13
36,639
30,980
18
Commercial and industrial
57,681
57,260
53,540
50,502
47,536
1
21
54,772
45,146
21
Total commercial banking
95,529
95,490
89,294
85,173
81,127
—
18
91,411
76,126
20
Total average loans held for investment
$ 306,881
$ 300,186
$ 286,110
$ 275,342
$ 267,159
2
15
$ 292,238
$ 252,730
16
2022 Q4 vs
Year Ended December 31,
2022
Q4
2022
Q3
2022
Q2
2022
Q1
2021
Q4
2022
Q3
2021
Q4
2022
2021
2022 vs. 2021
Net Charge-Off (Recovery) Rates
Credit card:
Domestic credit card(2)
3.22 %
2.20 %
2.26 %
2.12 %
1.49 %
102 bps
173 bps
2.47 %
1.90 %
57 bps
International card businesses
4.29
3.30
3.82
3.20
0.14
99
415
3.65
1.96
169
Total credit card
3.27
2.25
2.34
2.18
1.42
102
185
2.53
1.90
63
Consumer banking:
Auto
1.66
1.05
0.61
0.66
0.58
61
108
1.00
0.28
72
Retail banking
5.15
3.89
3.62
4.31
6.69
126
(154)
4.24
2.77
147
Total consumer banking
1.73
1.10
0.67
0.75
0.75
63
98
1.06
0.37
69
Commercial banking:
Commercial and multifamily real estate
0.05
0.03
(0.08)
—
—
2
5
—
0.03
(3)
Commercial and industrial
0.06
0.06
0.29
0.11
(0.03)
—
9
0.13
(0.01)
14
Total commercial banking
0.06
0.05
0.14
0.06
(0.02)
1
8
0.08
—
8
Total net charge-offs
1.86
1.24
1.18
1.11
0.79
62
107
1.36
0.88
48
30+ Day Performing Delinquency Rates
Credit card:
Domestic credit card
3.43 %
2.97 %
2.35 %
2.32 %
2.22 %
46 bps
121 bps
3.43 %
2.22 %
121 bps
International card businesses
4.03
3.90
3.67
3.58
3.42
13
61
4.03
3.42
61
Total credit card
3.46
3.01
2.42
2.38
2.28
45
118
3.46
2.28
118
Consumer banking:
Auto
5.62
4.85
4.47
3.85
4.32
77
130
5.62
4.32
130
Retail banking
1.02
0.84
0.67
0.74
1.92
18
(90)
1.02
1.92
(90)
Total consumer banking
5.53
4.77
4.39
3.78
4.26
76
127
5.53
4.26
127
Nonperforming Loans and Nonperforming Assets Rates(3)(4)
Credit card:
International card businesses
0.14 %
0.14 %
0.13 %
0.14 %
0.16 %
—
(2) bps
0.14 %
0.16 %
(2) bps
Total credit card
0.01
0.01
0.01
0.01
0.01
—
—
0.01
0.01
—
Consumer banking:
Auto
0.76
0.60
0.50
0.41
0.45
16 bps
31
0.76
0.45
31
Retail banking
2.49
2.62
2.61
2.63
2.51
(13)
(2)
2.49
2.51
(2)
Total consumer banking
0.79
0.64
0.54
0.46
0.50
15
29
0.79
0.50
29
Commercial banking:
Commercial and multifamily real estate
0.72
0.64
0.78
0.98
1.09
8
(37)
0.72
1.09
(37)
Commercial and industrial
0.75
0.53
0.64
0.69
0.64
22
11
0.75
0.64
11
Total commercial banking
0.74
0.57
0.70
0.81
0.82
17
(8)
0.74
0.82
(8)
Total nonperforming loans
0.43
0.35
0.37
0.38
0.40
8
3
0.43
0.40
3
Total nonperforming assets
0.45
0.37
0.39
0.40
0.41
8
4
0.45
0.41
4
CAPITAL ONE FINANCIAL CORPORATION (COF)
Table 8: Allowance for Credit Losses and Reserve for Unfunded Lending Commitments Activity
Three Months Ended December 31, 2022
Credit Card
Consumer Banking
(Dollars in millions)
Domestic Card
International Card Businesses
Total Credit Card
Auto
Retail Banking
Total Consumer Banking
Commercial Banking
Total
Allowance for credit losses:
Balance as of September 30, 2022
$ 8,370
$ 346
$ 8,716
$ 2,057
$ 51
$ 2,108
$ 1,385
$ 12,209
Charge-offs
(1,257)
(94)
(1,351)
(499)
(25)
(524)
(15)
(1,890)
Recoveries
252
31
283
171
5
176
1
460
Net charge-offs
(1,005)
(63)
(1,068)
(328)
(20)
(348)
(14)
(1,430)
Provision for credit losses
1,800
78
1,878
458
19
477
87
2,442
Allowance build for credit losses
795
15
810
130
(1)
129
73
1,012
Other changes(5)
—
19
19
—
—
—
—
19
Balance as of December 31, 2022
9,165
380
9,545
2,187
50
2,237
1,458
13,240
Reserve for unfunded lending commitments:
Balance as of September 30, 2022
—
—
—
—
—
—
243
243
Provision (benefit) for losses on unfunded lending commitments
—
—
—
—
—
—
(25)
(25)
Balance as of December 31, 2022
—
—
—
—
—
—
218
218
Combined allowance and reserve as of December 31, 2022
$ 9,165
$ 380
$ 9,545
$ 2,187
$ 50
$ 2,237
$ 1,676
$ 13,458
Year Ended December 31, 2022
Credit Card
Consumer Banking
(Dollars in millions)
Domestic Card
International Card Businesses
Total Credit Card
Auto
Retail Banking
Total Consumer Banking
Commercial Banking
Total
Allowance for credit losses:
Balance as of December 31, 2021
$ 7,968
$ 377
$ 8,345
$ 1,852
$ 66
$ 1,918
$ 1,167
$ 11,430
Charge-offs
(4,004)
(358)
(4,362)
(1,525)
(89)
(1,614)
(88)
(6,064)
Recoveries
1,171
143
1,314
741
19
760
17
2,091
Net charge-offs
(2,833)
(215)
(3,048)
(784)
(70)
(854)
(71)
(3,973)
Provision for credit losses
4,020
245
4,265
1,119
54
1,173
362
5,800
Allowance build (release) for credit losses
1,187
30
1,217
335
(16)
319
291
1,827
Other changes(5)
10
(27)
(17)
—
—
—
—
(17)
Balance as of December 31, 2022
9,165
380
9,545
2,187
50
2,237
1,458
13,240
Reserve for unfunded lending commitments:
Balance as of December 31, 2021
—
—
—
—
—
—
165
165
Provision (benefit) for losses on unfunded lending commitments
—
—
—
—
—
—
53
53
Balance as of December 31, 2022
—
—
—
—
—
—
218
218
Combined allowance and reserve as of December 31, 2022
$ 9,165
$ 380
$ 9,545
$ 2,187
$ 50
$ 2,237
$ 1,676
$ 13,458
CAPITAL ONE FINANCIAL CORPORATION (COF)
Table 9: Financial Summary—Business Segment Results
Three Months Ended December 31, 2022
Year Ended December 31, 2022
(Dollars in millions)
Credit Card
Consumer Banking
Commercial Banking(6)
Other(6)
Total
Credit Card
Consumer Banking
Commercial Banking(6)
Other(6)
Total
Net interest income (loss)
$ 4,533
$ 2,394
$ 520
$ (250)
$ 7,197
$ 16,584
$ 8,965
$ 2,461
$ (896)
$ 27,114
Non-interest income (loss)
1,449
139
261
(6)
1,843
5,771
469
1,129
(233)
7,136
Total net revenue (loss)
5,982
2,533
781
(256)
9,040
22,355
9,434
3,590
(1,129)
34,250
Provision (benefit) for credit losses
1,878
477
62
(1)
2,416
4,265
1,173
415
(6)
5,847
Non-interest expense
3,069
1,450
555
6
5,080
11,627
5,312
2,070
154
19,163
Income (loss) from continuing operations before income taxes
1,035
606
164
(261)
1,544
6,463
2,949
1,105
(1,277)
9,240
Income tax provision (benefit)
245
144
39
(116)
312
1,536
699
262
(617)
1,880
Income (loss) from continuing operations, net of tax
$ 790
$ 462
$ 125
$ (145)
$ 1,232
$ 4,927
$ 2,250
$ 843
$ (660)
$ 7,360
Three Months Ended September 30, 2022
(Dollars in millions)
Credit Card
Consumer Banking
Commercial Banking(6)
Other(6)
Total
Net interest income (loss)
$ 4,313
$ 2,311
$ 699
$ (320)
$ 7,003
Non-interest income (loss)
1,454
129
319
(100)
1,802
Total net revenue (loss)
5,767
2,440
1,018
(420)
8,805
Provision (benefit) for credit losses
1,261
285
123
—
1,669
Non-interest expense
3,004
1,340
542
63
4,949
Income (loss) from continuing operations before income taxes
1,502
815
353
(483)
2,187
Income tax provision (benefit)
356
193
83
(139)
493
Income (loss) from continuing operations, net of tax
$ 1,146
$ 622
$ 270
$ (344)
$ 1,694
Three Months Ended December 31, 2021
Year Ended December 31, 2021
(Dollars in millions)
Credit Card
Consumer Banking
Commercial Banking(6)
Other(6)
Total
Credit Card
Consumer Banking
Commercial Banking(6)
Other(6)
Total
Net interest income (loss)
$ 3,865
$ 2,158
$ 595
$ (168)
$ 6,450
$ 14,074
$ 8,448
$ 2,153
$ (504)
$ 24,171
Non-interest income (loss)
1,261
142
345
(80)
1,668
4,806
554
1,148
(244)
6,264
Total net revenue (loss)
5,126
2,300
940
(248)
8,118
18,880
9,002
3,301
(748)
30,435
Provision (benefit) for credit losses
423
2
(44)
—
381
(902)
(521)
(519)
(2)
(1,944)
Non-interest expense
2,799
1,285
520
74
4,678
9,621
4,711
1,815
423
16,570
Income (loss) from continuing operations before income taxes
1,904
1,013
464
(322)
3,059
10,161
4,812
2,005
(1,169)
15,809
Income tax provision (benefit)
451
239
109
(166)
633
2,403
1,136
473
(597)
3,415
Income (loss) from continuing operations, net of tax
$ 1,453
$ 774
$ 355
$ (156)
$ 2,426
$ 7,758
$ 3,676
$ 1,532
$ (572)
$ 12,394
CAPITAL ONE FINANCIAL CORPORATION (COF)
Table 10: Financial & Statistical Summary—Credit Card Business
2022 Q4 vs
Year Ended December 31,
(Dollars in millions, except as noted)
2022
Q4
2022
Q3
2022
Q2
2022
Q1
2021
Q4
2022
Q3
2021
Q4
2022
2021
2022 vs.
2021
Credit Card
Earnings:
Net interest income
$ 4,533
$ 4,313
$ 3,899
$ 3,839
$ 3,865
5 %
17 %
$ 16,584
$ 14,074
18 %
Non-interest income
1,449
1,454
1,410
1,458
1,261
—
15
5,771
4,806
20
Total net revenue
5,982
5,767
5,309
5,297
5,126
4
17
22,355
18,880
18
Provision (benefit) for credit losses
1,878
1,261
581
545
423
49
**
4,265
(902)
**
Non-interest expense
3,069
3,004
2,771
2,783
2,799
2
10
11,627
9,621
21
Income from continuing operations before income taxes
1,035
1,502
1,957
1,969
1,904
(31)
(46)
6,463
10,161
(36)
Income tax provision
245
356
466
469
451
(31)
(46)
1,536
2,403
(36)
Income from continuing operations, net of tax
$ 790
$ 1,146
$ 1,491
$ 1,500
$ 1,453
(31)
(46)
$ 4,927
$ 7,758
(36)
Selected performance metrics:
Period-end loans held for investment
$ 137,730
$ 126,913
$ 120,880
$ 113,962
$ 114,772
9
20
$ 137,730
$ 114,772
20
Average loans held for investment
130,652
123,357
115,835
111,480
108,588
6
20
120,392
102,731
17
Average yield on loans outstanding(1)
17.69 %
16.74 %
15.24 %
14.97 %
14.94 %
95 bps
275 bps
16.21 %
14.60 %
161 bps
Total net revenue margin(7)
18.32
18.70
18.33
18.56
18.11
(38)
21
18.47
17.81
66
Net charge-off rate
3.27
2.25
2.34
2.18
1.42
102
185
2.53
1.90
63
30+ day performing delinquency rate
3.46
3.01
2.42
2.38
2.28
45
118
3.46
2.28
118
30+ day delinquency rate
3.46
3.02
2.42
2.39
2.29
44
117
3.46
2.29
117
Nonperforming loan rate(3)
0.01
0.01
0.01
0.01
0.01
—
—
0.01
0.01
—
Purchase volume(8)
$ 155,633
$ 149,497
$ 148,491
$ 133,662
$ 149,982
4 %
4 %
$ 587,283
$ 527,605
11 %
2022 Q4 vs
Year Ended December 31,
(Dollars in millions, except as noted)
2022
Q4
2022
Q3
2022
Q2
2022
Q1
2021
Q4
2022
Q3
2021
Q4
2022
2021
2022 vs.
2021
Domestic Card
Earnings:
Net interest income
$ 4,280
$ 4,065
$ 3,651
$ 3,620
$ 3,558
5 %
20 %
$ 15,616
$ 12,916
21 %
Non-interest income
1,392
1,383
1,340
1,248
1,190
1
17
5,363
4,532
18
Total net revenue
5,672
5,448
4,991
4,868
4,748
4
19
20,979
17,448
20
Provision (benefit) for credit losses
1,800
1,167
494
559
384
54
**
4,020
(868)
**
Non-interest expense
2,866
2,803
2,594
2,564
2,564
2
12
10,827
8,712
24
Income from continuing operations before income taxes
1,006
1,478
1,903
1,745
1,800
(32)
(44)
6,132
9,604
(36)
Income tax provision
238
351
450
414
424
(32)
(44)
1,453
2,266
(36)
Income from continuing operations, net of tax
$ 768
$ 1,127
$ 1,453
$ 1,331
$ 1,376
(32)
(44)
$ 4,679
$ 7,338
(36)
Selected performance metrics:
Period-end loans held for investment
$ 131,581
$ 121,279
$ 115,004
$ 107,987
$ 108,723
8
21
$ 131,581
$ 108,723
21
Average loans held for investment
124,816
117,467
109,962
105,536
102,717
6
22
114,506
95,818
20
Average yield on loans outstanding(1)
17.58 %
16.61 %
15.03 %
14.82 %
14.86 %
97 bps
272 bps
16.07 %
14.49 %
158 bps
Total net revenue margin(7)
18.18
18.55
18.16
18.28
18.14
(37)
4
18.28
17.85
43
Net charge-off rate(2)
3.22
2.20
2.26
2.12
1.49
102
173
2.47
1.90
57
30+ day performing delinquency rate
3.43
2.97
2.35
2.32
2.22
46
121
3.43
2.22
121
Purchase volume(8)
$ 151,995
$ 145,805
$ 144,668
$ 126,284
$ 138,825
4 %
9 %
$ 568,752
$ 487,297
17 %
Refreshed FICO scores:(9)
Greater than 660
69 %
70 %
70 %
70 %
71 %
(1)
(2)
69 %
71 %
(2)
660 or below
31
30
30
30
29
1
2
31
29
2
Total
100 %
100 %
100 %
100 %
100 %
100 %
100 %
CAPITAL ONE FINANCIAL CORPORATION (COF)
Table 11: Financial & Statistical Summary—Consumer Banking Business
2022 Q4 vs
Year Ended December 31,
(Dollars in millions, except as noted)
2022
Q4
2022
Q3
2022
Q2
2022 Q1
2021
Q4
2022
Q3
2021
Q4
2022
2021
2022 vs.
2021
Consumer Banking
Earnings:
Net interest income
$ 2,394
$ 2,311
$ 2,147
$ 2,113
$ 2,158
4 %
11 %
$ 8,965
$ 8,448
6 %
Non-interest income
139
129
96
105
142
8
(2)
469
554
(15)
Total net revenue
2,533
2,440
2,243
2,218
2,300
4
10
9,434
9,002
5
Provision (benefit) for credit losses
477
285
281
130
2
67
**
1,173
(521)
**
Non-interest expense
1,450
1,340
1,286
1,236
1,285
8
13
5,312
4,711
13
Income from continuing operations before income taxes
606
815
676
852
1,013
(26)
(40)
2,949
4,812
(39)
Income tax provision
144
193
160
202
239
(25)
(40)
699
1,136
(38)
Income from continuing operations, net of tax
$ 462
$ 622
$ 516
$ 650
$ 774
(26)
(40)
$ 2,250
$ 3,676
(39)
Selected performance metrics:
Period-end loans held for investment
$ 79,925
$ 81,199
$ 81,531
$ 80,330
$ 77,646
(2)
3
$ 79,925
$ 77,646
3
Average loans held for investment
80,700
81,339
80,981
78,689
77,444
(1)
4
80,435
73,873
9
Average yield on loans held for investment(1)
7.31 %
7.20 %
7.08 %
7.17 %
7.55 %
11 bps
(24) bps
7.19 %
7.86 %
(67) bps
Auto loan originations
$ 6,635
$ 8,289
$ 10,328
$ 11,713
$ 9,721
(20) %
(32) %
$ 36,965
$ 43,083
(14) %
Period-end deposits
270,592
256,661
255,904
258,359
256,407
5
6
270,592
256,407
6
Average deposits
262,844
255,843
254,336
255,265
253,372
3
4
257,089
251,676
2
Average deposits interest rate
1.42 %
0.79 %
0.38 %
0.29 %
0.30 %
63 bps
112 bps
0.72 %
0.32 %
40 bps
Net charge-off rate
1.73
1.10
0.67
0.75
0.75
63
98
1.06
0.37
69
30+ day performing delinquency rate
5.53
4.77
4.39
3.78
4.26
76
127
5.53
4.26
127
30+ day delinquency rate
6.18
5.28
4.81
4.13
4.66
90
152
6.18
4.66
152
Nonperforming loan rate(3)
0.79
0.64
0.54
0.46
0.50
15
29
0.79
0.50
29
Nonperforming asset rate(4)
0.87
0.71
0.60
0.52
0.56
16
31
0.87
0.56
31
Auto—At origination FICO scores:(10)
Greater than 660
53 %
52 %
52 %
51 %
50 %
1 %
3 %
53 %
50 %
3 %
621 - 660
20
20
20
20
20
—
—
20
20
—
620 or below
27
28
28
29
30
(1)
(3)
27
30
(3)
Total
100 %
100 %
100 %
100 %
100 %
100 %
100 %
CAPITAL ONE FINANCIAL CORPORATION (COF)
Table 12: Financial & Statistical Summary—Commercial Banking Business
2022 Q4 vs
Year Ended December 31,
(Dollars in millions, except as noted)
2022
Q4
2022
Q3
2022
Q2
2022
Q1
2021
Q4
2022
Q3
2021
Q4
2022
2021
2022 vs.
2021
Commercial Banking
Earnings:
Net Interest Income(11)
$ 520
$ 699
$ 635
$ 607
$ 595
(26) %
(13) %
$ 2,461
$ 2,153
14 %
Non-interest income
261
319
272
277
345
(18)
(24)
1,129
1,148
(2)
Total net revenue(6)
781
1,018
907
884
940
(23)
(17)
3,590
3,301
9
Provision (benefit) for credit losses
62
123
222
8
(44)
(50)
**
415
(519)
**
Non-interest expense
555
542
485
488
520
2
7
2,070
1,815
14
Income from continuing operations before income taxes
164
353
200
388
464
(54)
(65)
1,105
2,005
(45)
Income tax provision
39
83
48
92
109
(53)
(64)
262
473
(45)
Income from continuing operations, net of tax
$ 125
$ 270
$ 152
$ 296
$ 355
(54)
(65)
$ 843
$ 1,532
(45)
Selected performance metrics:
Period-end loans held for investment
$ 94,676
$ 95,831
$ 93,973
$ 86,174
$ 84,922
(1)
11
$ 94,676
$ 84,922
11
Average loans held for investment
95,529
95,490
89,294
85,173
81,127
—
18
91,411
76,126
20
Average yield on loans held for investment(1)(6)
5.63 %
4.40 %
3.18 %
2.66 %
2.71 %
123 bps
292 bps
4.02 %
2.74 %
128 bps
Period-end deposits
$ 40,808
$ 41,058
$ 38,844
$ 45,232
$ 44,809
(1) %
(9) %
$ 40,808
$ 44,809
(9) %
Average deposits
42,779
39,799
40,536
45,008
44,206
7
(3)
42,018
42,350
(1)
Average deposits interest rate
1.80 %
0.83 %
0.19 %
0.12 %
0.12 %
97 bps
168 bps
0.73 %
0.14 %
59 bps
Net charge-off (recovery) rate
0.06
0.05
0.14
0.06
(0.02)
1
8
0.08
—
8
Nonperforming loan rate(3)
0.74
0.57
0.70
0.81
0.82
17
(8)
0.74
0.82
(8)
Nonperforming asset rate(4)
0.74
0.57
0.70
0.81
0.82
17
(8)
0.74
0.82
(8)
Risk category:(12)
Noncriticized
$ 87,620
$ 89,559
$ 88,349
$ 80,586
$ 79,014
(2) %
11 %
$ 87,620
$ 79,014
11 %
Criticized performing
6,355
5,722
4,969
4,893
5,209
11
22
6,355
5,209
22
Criticized nonperforming
701
550
655
695
699
27
—
701
699
—
Total commercial banking loans
$ 94,676
$ 95,831
$ 93,973
$ 86,174
$ 84,922
(1)
11
$ 94,676
$ 84,922
11
Risk category as a percentage of period-end loans held for investment:(12)
Noncriticized
92.55 %
93.46 %
94.01 %
93.51 %
93.05 %
(91) bps
(50) bps
92.55 %
93.05 %
(50) bps
Criticized performing
6.71
5.97
5.29
5.68
6.13
74
58
6.71
6.13
58
Criticized nonperforming
0.74
0.57
0.70
0.81
0.82
17
(8)
0.74
0.82
(8)
Total commercial banking loans
100.00 %
100.00 %
100.00 %
100.00 %
100.00 %
100.00 %
100.00 %
CAPITAL ONE FINANCIAL CORPORATION (COF)
Table 13: Financial & Statistical Summary—Other and Total
2022 Q4 vs
Year Ended December 31,
(Dollars in millions)
2022
Q4
2022
Q3
2022
Q2
2022
Q1
2021
Q4
2022
Q3
2021
Q4
2022
2021
2022 vs.
2021
Other
Earnings:
Net Interest Loss(11)
$ (250)
$ (320)
$ (164)
$ (162)
$ (168)
(22) %
49 %
$ (896)
$ (504)
78 %
Non-interest loss
(6)
(100)
(63)
(64)
(80)
(94)
(93)
(233)
(244)
(5)
Total net loss(6)
(256)
(420)
(227)
(226)
(248)
(39)
3
(1,129)
(748)
51
Provision (benefit) for credit losses
(1)
—
1
(6)
—
**
**
(6)
(2)
**
Non-interest expense(13)
6
63
41
44
74
(90)
(92)
154
423
(64)
Loss from continuing operations before income taxes
(261)
(483)
(269)
(264)
(322)
(46)
(19)
(1,277)
(1,169)
9
Income tax benefit
(116)
(139)
(141)
(221)
(166)
(17)
(30)
(617)
(597)
3
Loss from continuing operations, net of tax
$ (145)
$ (344)
$ (128)
$ (43)
$ (156)
(58)
(7)
$ (660)
$ (572)
15
Selected performance metrics:
Period-end deposits
$ 21,592
$ 19,474
$ 13,137
$ 9,838
$ 9,764
11
121
$ 21,592
$ 9,764
121
Average deposits
20,935
16,286
11,082
9,324
9,694
29
116
14,444
12,371
17
Total
Earnings:
Net interest income
$ 7,197
$ 7,003
$ 6,517
$ 6,397
$ 6,450
3 %
12 %
$ 27,114
$ 24,171
12 %
Non-interest income
1,843
1,802
1,715
1,776
1,668
2
10
7,136
6,264
14
Total net revenue
9,040
8,805
8,232
8,173
8,118
3
11
34,250
30,435
13
Provision (benefit) for credit losses
2,416
1,669
1,085
677
381
45
**
5,847
(1,944)
**
Non-interest expense
5,080
4,949
4,583
4,551
4,678
3
9
19,163
16,570
16
Income from continuing operations before income taxes
1,544
2,187
2,564
2,945
3,059
(29)
(50)
9,240
15,809
(42)
Income tax provision
312
493
533
542
633
(37)
(51)
1,880
3,415
(45)
Income from continuing operations, net of tax
$ 1,232
$ 1,694
$ 2,031
$ 2,403
$ 2,426
(27)
(49)
$ 7,360
$ 12,394
(41)
Selected performance metrics:
Period-end loans held for investment
$ 312,331
$ 303,943
$ 296,384
$ 280,466
$ 277,340
3
13
$ 312,331
$ 277,340
13
Average loans held for investment
306,881
300,186
286,110
275,342
267,159
2
15
292,238
252,730
16
Period-end deposits
332,992
317,193
307,885
313,429
310,980
5
7
332,992
310,980
7
Average deposits
326,558
311,928
305,954
309,597
307,272
5
6
313,551
306,397
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)
In August 2022, in addition to our normal recovery activity, we sold a pool of charged-off loans that resulted in elevated debt sale recovery activity of approximately $33 million , which decreased the Domestic Credit Card net charge-off rate for the third quarter of 2022 by approximately 11 basis points. Excluding the impact, the Domestic Credit Card net charge-off rate would have been 2.31% for the third quarter of 2022.
(3)
Nonperforming loan rates are calculated based on nonperforming loans for each category divided by period-end total loans held for investment for each respective category. For Commercial Banking, loans categorized as nonperforming are considered criticized nonperforming.
(4)
Nonperforming assets consist of nonperforming loans, repossessed assets and other foreclosed assets. The total nonperforming asset rate is calculated based on total nonperforming assets divided by the combined period-end total loans held for investment, repossessed assets and other foreclosed assets.
(5)
Primarily represents foreign currency translation adjustments and, in periods of acquisition, initial allowance builds for purchase credit-deteriorated loans.
(6)
Some of our commercial investments generate tax-exempt income, tax credits or other tax benefits. Accordingly, we present our Commercial Banking revenue and yields on a taxable-equivalent basis, calculated using the federal statutory tax rate of 21% and state taxes where applicable, with offsetting reductions to the Other category.
(7)
Total net revenue margin is calculated based on annualized total net revenue for the period divided by average loans outstanding during the period.
(8)
Purchase volume consists of purchase transactions, net of returns, for the period, and excludes cash advance and balance transfer transactions.
(9)
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.
(10)
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.
(11)
In the fourth quarter of 2022, an internal funds transfer pricing impact of $176 million decreased net interest income in the Commercial Banking business and increased the Other category, and was therefore neutral to the company.
(12)
Criticized exposures correspond to the "Special Mention," "Substandard" and "Doubtful" asset categories defined by bank regulatory authorities.
(13)
Includes charges incurred as a result of restructuring activities.
**
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)
December 31, 2022
September 30,
2022
June 30,
2022
March 31,
2022
December 31,
2021
Regulatory Capital Metrics
Common equity excluding AOCI
$ 59,450
$ 58,516
$ 57,278
$ 57,390
$ 58,206
Adjustments:
AOCI, net of tax(2)
(17)
(120)
(72)
(20)
(23)
Goodwill, net of related deferred tax liabilities
(14,540)
(14,537)
(14,548)
(14,559)
(14,562)
Other Intangible and deferred tax assets, net of deferred tax liabilities
(162)
(194)
(95)
(110)
(120)
Common equity Tier 1 capital
$ 44,731
$ 43,665
$ 42,563
$ 42,701
$ 43,501
Tier 1 capital
$ 49,576
$ 48,510
$ 47,408
$ 47,547
$ 48,346
Total capital(3)
56,715
55,938
55,100
55,059
56,089
Risk-weighted assets
357,939
356,801
351,746
336,739
332,673
Adjusted average assets(4)
444,704
439,479
427,446
418,957
415,141
Capital Ratios
Common equity Tier 1 capital(5)
12.5 %
12.2 %
12.1 %
12.7 %
13.1 %
Tier 1 capital(6)
13.9
13.6
13.5
14.1
14.5
Total capital(7)
15.8
15.7
15.7
16.4
16.9
Tier 1 leverage(4)
11.1
11.0
11.1
11.3
11.6
TCE(8)
7.5
7.2
7.9
8.7
9.9
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)
2022
Q4
2022
Q3
2022
Q2
2022
Q1
2021
Q4
Year Ended December 31,
2022
2021
Adjusted diluted earnings per share ("EPS"):
Net income available to common stockholders (GAAP)
$ 1,161
$ 1,616
$ 1,949
$ 2,318
$ 2,296
$ 7,044
$ 11,965
Insurance recoveries and legal reserve activity
(177)
—
—
—
—
(177)
100
Restructuring Charges
72
—
—
—
—
72
—
Adjusted net income available to common stockholders before income tax impacts (non-GAAP)
1,056
1,616
1,949
2,318
2,296
6,939
12,065
Income tax impacts
25
—
—
—
—
25
(24)
Adjusted net income available to common stockholders (non-GAAP)
$ 1,081
$ 1,616
$ 1,949
$ 2,318
$ 2,296
$ 6,964
$ 12,041
Diluted weighted-average common shares outstanding (in millions) (GAAP)
383.7
384.6
392.6
412.2
424.3
393.2
444.2
Diluted EPS (GAAP)
$ 3.03
$ 4.20
$ 4.96
$ 5.62
$ 5.41
$ 17.91
$ 26.94
Impact of adjustments noted above
(0.21)
—
—
—
—
(0.20)
0.17
Adjusted diluted EPS (non-GAAP)
$ 2.82
$ 4.20
$ 4.96
$ 5.62
$ 5.41
$ 17.71
$ 27.11
Adjusted efficiency ratio:
Non-interest expense (GAAP)
$ 5,080
$ 4,949
$ 4,583
$ 4,551
$ 4,678
$ 19,163
$ 16,570
Insurance recoveries and legal reserve activity
177
—
—
—
—
177
(100)
Restructuring Charges
(72)
—
—
—
—
(72)
—
Adjusted non-interest expense (non-GAAP)
$ 5,185
$ 4,949
$ 4,583
$ 4,551
$ 4,678
$ 19,268
$ 16,470
Total net revenue (GAAP)
$ 9,040
$ 8,805
$ 8,232
$ 8,173
$ 8,118
$ 34,250
$ 30,435
Efficiency ratio (GAAP)
56.19 %
56.21 %
55.67 %
55.68 %
57.63 %
55.95 %
54.44 %
Impact of adjustments noted above
117 bps
—
—
—
—
31 bps
(32) bps
Adjusted efficiency ratio (non-GAAP)
57.36 %
56.21 %
55.67 %
55.68 %
57.63 %
56.26 %
54.12 %
Adjusted operating efficiency ratio:
Operating expense (GAAP)
$ 3,962
$ 3,971
$ 3,580
$ 3,633
$ 3,679
$ 15,146
$ 13,699
Insurance recoveries and legal reserve activity
177
—
—
—
—
177
(100)
Restructuring Charges
(72)
—
—
—
—
(72)
—
Adjusted operating expense (non-GAAP)
$ 4,067
$ 3,971
$ 3,580
$ 3,633
$ 3,679
$ 15,251
$ 13,599
Total net revenue (GAAP)
$ 9,040
$ 8,805
$ 8,232
$ 8,173
$ 8,118
$ 34,250
$ 30,435
Operating efficiency ratio (GAAP)
43.83 %
45.10 %
43.49 %
44.45 %
45.32 %
44.22 %
45.01 %
Impact of adjustments noted above
116 bps
—
—
—
—
31 bps
(33) bps
Adjusted operating efficiency ratio (non-GAAP)
44.99 %
45.10 %
43.49 %
44.45 %
45.32 %
44.53 %
44.68 %
Reconciliation of Non-GAAP Measures
The following non-GAAP measures consist of TCE, tangible assets and metrics computed using these amounts, which include
tangible book value per common share, return on average tangible assets, return on average TCE and TCE ratio. We consider
these metrics to be key financial performance measures that management uses in assessing capital adequacy and the level of
returns generated. While our non-GAAP measures are widely used by investors, analysts and bank regulatory agencies to
assess the capital position of financial services companies, they may not be comparable to similarly-titled measures reported
by other companies. The following tables present reconciliations of these non-GAAP measures to the applicable amounts measured
in accordance with GAAP.
(Dollars in millions)
2022
Q4
2022
Q3
2022
Q2
2022
Q1
2021
Q4
Tangible Common Equity (Period-End)
Stockholders' equity
$ 52,582
$ 50,861
$ 53,410
$ 56,345
$ 61,029
Goodwill and intangible assets(9)
(14,902)
(14,932)
(14,850)
(14,883)
(14,907)
Noncumulative perpetual preferred stock
(4,845)
(4,845)
(4,845)
(4,845)
(4,845)
Tangible common equity
$ 32,835
$ 31,084
$ 33,715
$ 36,617
$ 41,277
Tangible Common Equity (Average)
Stockholders' equity
$ 52,439
$ 54,541
$ 54,165
$ 59,437
$ 62,498
Goodwill and intangible assets(9)
(14,926)
(14,916)
(14,875)
(14,904)
(14,847)
Noncumulative perpetual preferred stock
(4,845)
(4,845)
(4,845)
(4,845)
(5,552)
Tangible common equity
$ 32,668
$ 34,780
$ 34,445
$ 39,688
$ 42,099
Tangible Assets (Period-End)
Total assets
$ 455,249
$ 444,232
$ 440,288
$ 434,195
$ 432,381
Goodwill and intangible assets(9)
(14,902)
(14,932)
(14,850)
(14,883)
(14,907)
Tangible assets
$ 440,347
$ 429,300
$ 425,438
$ 419,312
$ 417,474
Tangible Assets (Average)
Total assets
$ 449,659
$ 447,088
$ 435,327
$ 430,372
$ 427,845
Goodwill and intangible assets(9)
(14,926)
(14,916)
(14,875)
(14,904)
(14,847)
Tangible assets
$ 434,733
$ 432,172
$ 420,452
$ 415,468
$ 412,998
__________
(1)
Regulatory capital metrics and capital ratios as of December 31, 2022 are preliminary and therefore subject to change.
(2)
Excludes certain components of AOCI as permitted under the Tailoring Rules.
(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)
Includes impact of related deferred taxes.
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SOURCE Capital One Financial Corporation
Capital One Financial Corp.
COF Rankings
#2530 Ranked by Stock Gains
COF Stock Data
Industry
Credit Card Issuing
Sector
Finance and Insurance
Tags
Finance, Major Banks, Finance and Insurance, Credit Card Issuing
Country
US
City
Mc Lean
About COF
capital one financial corporation, incorporated in july 21, 1994, is a diversified banking company focused primarily on consumer and commercial lending and deposit origination. its principal business segments are local banking and national lending. local banking includes consumer, small business and commercial deposits, and lending conducted within its branch network. the national lending segment consists of three sub-segments: the u.s. card sub-segment, which consists of domestic consumer credit and debit card activities; the auto finance sub-segment, which includes automobile and other motor vehicle financing activities, and the global financial services sub-segment consisting of international lending activities, small business lending, installment loans, home loans, healthcare financing and other diversified activities.