Capital One Reports Second Quarter 2021 Net Income of $3.5 billion, or $7.62 per share
07/22/2021 - 04:05 PM
MCLEAN, Va. , July 22, 2021 /PRNewswire/ -- Capital One Financial Corporation (NYSE: COF) today announced net income for the second quarter of 2021 of $3.5 billion , or $7.62 per diluted common share, compared with net income of $3 .3 billion, or $7.03 per diluted common share in the first quarter of 2021, and with a net loss of $918 million , or $2.21 per diluted common share in the second quarter of 2020. Excluding adjusting items, net income for the second quarter of 2021 was $7.71 per diluted common share.(1)
"We are seeing increasing near-term opportunities to build our franchise as we emerge from the pandemic," said Richard D. Fairbank , Founder, Chairman and Chief Executive Officer. "Our modern technology is powering our current performance and setting us up to capitalize on the accelerating digital revolution in banking."
The quarter included the following adjusting item:
(Dollars in millions, except per share data)
Pre-Tax
Impact
Diluted EPS
Impact
Legal reserve build
$
55
$
0.09
All comparisons below are for the second quarter of 2021 compared with the first quarter of 2021 unless otherwise noted.
Second Quarter 2021 Income Statement Summary:
Total net revenue increased 4 percent to $7.4 billion . Total non-interest expense increased 6 percent to $4.0 billion : 24 percent increase in marketing. 3 percent increase in operating expenses. Pre-provision earnings increased 1 percent to $3.4 billion .(2) Provision (benefit) for credit losses decreased $337 million to $(1.2) billion : Net charge-offs of $541 million . $1.7 billion loan reserve release.Net interest margin of 5.89 percent, a decrease of 10 basis points. Efficiency ratio of 53.78 percent. Efficiency ratio excluding adjusting items of 53.04 percent.(1) Operating efficiency ratio of 45.38 percent. Operating efficiency ratio excluding adjusting items of 44.63 percent.(1) Second Quarter 2021 Balance Sheet Summary:
Common equity Tier 1 capital ratio under Basel III Standardized Approach of 14.5 percent at June 30, 2021 . Period-end loans held for investment in the quarter increased $6.5 billion , or 3 percent, to $249.6 billion . Credit Card period-end loans increased $1.9 billion , or 2 percent, to $101.0 billion . Domestic Card period-end loans increased $4.2 billion , or 5 percent, to $95.3 billion . Consumer Banking period-end loans increased $4.6 billion , or 6 percent, to $74.8 billion . Auto period-end loans increased $4.7 billion , or 7 percent, to $71.7 billion . Commercial Banking period-end loans increased $19 million , or less than 1 percent, to $73.8 billion . Average loans held for investment in the quarter increased $2.5 billion , or 1 percent, to $246.5 billion . Credit Card average loans decreased $860 million , or 1 percent, to $99.7 billion . Domestic Card average loans decreased $1.1 billion , or 1 percent, to $91.5 billion . Consumer Banking average loans increased $3.5 billion , or 5 percent, to $72.7 billion . Auto average loans increased $3.4 billion , or 5 percent, to $69.5 billion . Commercial Banking average loans decreased $85 million , or less than 1 percent, to $74.1 billion . Period-end total deposits decreased $4.0 billion , or 1 percent, to $306.3 billion , while average deposits increased $3.2 billion , or 1 percent, to $308.2 billion . Interest-bearing deposits rate paid decreased 4 basis points to 0.35 percent.
(1)
Amounts excluding adjusting items are non-GAAP measures that we believe help investors and users of our financial information understand the effect of adjusting items on our selected reported results and provide alternate measurements of our performance, 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.
(2)
Pre-provision earnings is calculated based on the sum of net interest income and non-interest income, less non-interest expense for the period. 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.
Earnings Conference Call Webcast Information
The company will hold an earnings conference call on July 22, 2021 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 August 5, 2021 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, 2020 .
About Capital One
Capital One Financial Corporation (www.capitalone.com ) is a financial holding company whose subsidiaries, which include Capital One, N.A., and Capital One Bank (USA ), N.A., had $306.3 billion in deposits and $423.4 billion in total assets as of June 30, 2021. Headquartered in McLean, Virginia , Capital One offers a broad spectrum of financial products and services to consumers, small businesses and commercial clients through a variety of channels. Capital One, N.A. has branches located primarily in New York , Louisiana , Texas , Maryland , Virginia , New Jersey and the District of Columbia . A Fortune 500 company, Capital One trades on the New York Stock Exchange under the symbol "COF" and is included in the S&P 100 index.
Exhibit 99.2
Capital One Financial Corporation
Financial Supplement(1)(2)
Second Quarter 2021
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
7
Table 5:
Notes to Financial Summary, Selected Metrics and Consolidated Financial Statements (Tables 1—4)
10
Table 6:
Average Balances, Net Interest Income and Net Interest Margin
11
Table 7:
Loan Information and Performance Statistics
12
Table 8:
Allowance for Credit Losses and Reserve for Unfunded Lending Commitments Activity
14
Business Segment Results
Table 9:
Financial Summary—Business Segment Results
15
Table 10:
Financial & Statistical Summary—Credit Card Business
16
Table 11:
Financial & Statistical Summary—Consumer Banking Business
18
Table 12:
Financial & Statistical Summary—Commercial Banking Business
19
Table 13:
Financial & Statistical Summary—Other and Total
20
Other
Table 14:
Notes to Loan, Allowance and Business Segment Disclosures (Tables 7—13)
21
Table 15:
Calculation of Regulatory Capital Measures and Reconciliation of Non-GAAP Measures
22
__________
(1)
The information contained in this Financial Supplement is preliminary and based on data available at the time of the earnings presentation. Investors should refer to our Quarterly Report on Form 10-Q for the period ended June 30, 2021 once it is filed with the Securities and Exchange Commission.
(2)
This Financial Supplement includes non-GAAP measures. We believe these non-GAAP measures are useful to investors and users of our financial information as they provide an alternate measurement of our performance and assist in assessing our capital adequacy and the level of return generated. These non-GAAP measures should not be viewed as a substitute for reported results determined in accordance with generally accepted accounting principles in the U.S. ("GAAP"), nor are they necessarily comparable to non-GAAP measures that may be presented by other companies.
CAPITAL ONE FINANCIAL CORPORATION (COF)
Table 1: Financial Summary—Consolidated
2021 Q2 vs.
Six Months Ended June 30,
(Dollars in millions, except per share data and as noted)
2021
2021
2020
2020
2020
2021
2020
2021 vs.
Q2
Q1
Q4
Q3
Q2
Q1
Q2
2021
2020
2020
Income Statement
Net interest income
$
5,743
$
5,822
$
5,873
$
5,555
$
5,460
(1)
%
5
%
$
11,565
$
11,485
1
%
Non-interest income
1,631
1,291
1,464
1,826
1,096
26
49
2,922
2,320
26
Total net revenue(1)
7,374
7,113
7,337
7,381
6,556
4
12
14,487
13,805
5
Provision (benefit) for credit losses
(1,160)
(823)
264
331
4,246
41
**
(1,983)
9,669
**
Non-interest expense:
Marketing
620
501
563
283
273
24
127
1,121
764
47
Operating expense
3,346
3,239
3,446
3,265
3,497
3
(4)
6,585
6,735
(2)
Total non-interest expense
3,966
3,740
4,009
3,548
3,770
6
5
7,706
7,499
3
Income (loss) from continuing operations before income taxes
4,568
4,196
3,064
3,502
(1,460)
9
**
8,764
(3,363)
**
Income tax provision (benefit)
1,031
869
496
1,096
(543)
19
**
1,900
(1,106)
**
Income (loss) from continuing operations, net of tax
3,537
3,327
2,568
2,406
(917)
6
**
6,864
(2,257)
**
Loss from discontinued operations, net of tax
(1)
(2)
(2)
—
(1)
(50)
—
(3)
(1)
**
Net income (loss)
3,536
3,325
2,566
2,406
(918)
6
**
6,861
(2,258)
**
Dividends and undistributed earnings allocated to participating securities(2)
(30)
(28)
(19)
(20)
(1)
7
**
(58)
(4)
**
Preferred stock dividends
(60)
(61)
(68)
(67)
(90)
(2)
(33)
(121)
(145)
(17)
Issuance cost for redeemed preferred stock(3)
—
—
(17)
—
—
—
—
—
(22)
**
Net income (loss) available to common stockholders
$
3,446
$
3,236
$
2,462
$
2,319
$
(1,009)
6
**
$
6,682
$
(2,429)
**
Common Share Statistics
Basic earnings per common share:(2)
Net income (loss) from continuing operations
$
7.65
$
7.06
$
5.36
$
5.07
$
(2.21)
8
%
**
$
14.70
$
(5.31)
**
Net income (loss) per basic common share
$
7.65
$
7.06
$
5.36
$
5.07
$
(2.21)
8
**
$
14.70
$
(5.31)
**
Diluted earnings per common share:(2)
Net income (loss) from continuing operations
$
7.62
$
7.03
$
5.35
$
5.06
$
(2.21)
8
**
$
14.65
$
(5.31)
**
Net income (loss) per diluted common share
$
7.62
$
7.03
$
5.35
$
5.06
$
(2.21)
8
**
$
14.65
$
(5.31)
**
Weighted-average common shares outstanding (in millions):
Basic
450.6
458.6
459.1
457.8
456.7
(2)
(1)
%
454.6
457.1
(1)
%
Diluted
452.3
460.1
460.2
458.5
456.7
(2)
(1)
456.2
457.1
—
Common shares outstanding (period-end, in millions)
446.1
456.8
459.0
457.4
456.3
(2)
(2)
446.1
456.3
(2)
Dividends declared and paid per common share
$
0.40
$
0.40
$
0.10
$
0.10
$
0.40
—
—
$
0.80
$
0.80
—
Tangible book value per common share (period-end)(4)
97.20
90.96
88.34
83.67
78.82
7
23
97.20
78.82
23
2021 Q2 vs.
Six Months Ended June 30,
(Dollars in millions)
2021
2021
2020
2020
2020
2021
2020
2021 vs.
Q2
Q1
Q4
Q3
Q2
Q1
Q2
2021
2020
2020
Balance Sheet (Period-End)
Loans held for investment
$
249,597
$
243,131
$
251,624
$
248,223
$
251,512
3
%
(1)
%
$
249,597
$
251,512
(1)
%
Interest-earning assets
387,295
392,485
388,917
390,040
389,829
(1)
(1)
387,295
389,829
(1)
Total assets
423,420
425,175
421,602
421,883
421,296
—
1
423,420
421,296
1
Interest-bearing deposits
271,314
276,325
274,300
276,092
275,183
(2)
(1)
271,314
275,183
(1)
Total deposits
306,308
310,328
305,442
305,725
304,238
(1)
1
306,308
304,238
1
Borrowings
36,343
38,450
40,539
42,795
44,900
(5)
(19)
36,343
44,900
(19)
Common equity
58,136
56,341
55,356
53,093
50,835
3
14
58,136
50,835
14
Total stockholders' equity
64,624
61,188
60,204
58,424
56,045
6
15
64,624
56,045
15
Balance Sheet (Average Balances)
Loans held for investment
$
246,463
$
243,937
$
247,689
$
249,511
$
253,358
1
%
(3)
%
$
245,207
$
258,124
(5)
%
Interest-earning assets
390,129
388,572
388,252
391,451
378,145
—
3
389,355
366,746
6
Total assets
424,099
421,808
420,011
422,854
411,075
1
3
422,959
400,845
6
Interest-bearing deposits
273,476
273,358
274,142
276,339
261,256
—
5
273,417
251,185
9
Total deposits
308,217
305,056
304,513
305,516
288,344
1
7
306,645
276,498
11
Borrowings
37,054
39,911
40,662
44,161
49,827
(7)
(26)
38,475
50,810
(24)
Common equity
56,885
55,775
54,220
51,995
52,413
2
9
56,333
52,799
7
Total stockholders' equity
62,376
60,623
59,389
57,223
57,623
3
8
61,504
58,096
6
CAPITAL ONE FINANCIAL CORPORATION (COF)
Table 2: Selected Metrics—Consolidated
2021 Q2 vs.
Six Months Ended June 30,
(Dollars in millions, except as noted)
2021
2021
2020
2020
2020
2021
2020
2021 vs.
Q2
Q1
Q4
Q3
Q2
Q1
Q2
2021
2020
2020
Performance Metrics
Net interest income growth (period over period)
(1)
%
(1)
%
6
%
2
%
(9)
%
**
**
1
%
—
**
Non-interest income growth (period over period)
26
(12)
(20)
67
(10)
**
**
26
(13)
%
**
Total net revenue growth (period over period)
4
(3)
(1)
13
(10)
**
**
5
(3)
**
Total net revenue margin(5)
7.56
7.32
7.56
7.54
6.93
24
bps
63
bps
7.44
7.53
(9)
bps
Net interest margin(6)
5.89
5.99
6.05
5.68
5.78
(10)
11
5.94
6.26
(32)
Return on average assets
3.34
3.16
2.45
2.28
(0.89)
18
4
%
3.25
(1.13)
4
%
Return on average tangible assets(7)
3.46
3.27
2.54
2.36
(0.93)
19
4
3.36
(1.17)
5
Return on average common equity(8)
24.24
23.22
18.18
17.84
(7.69)
102
32
23.73
(9.20)
33
Return on average tangible common equity(9)
32.75
31.61
25.02
24.98
(10.74)
114
43
32.19
(12.81)
45
Non-interest expense as a percentage of average loans held for investment
6.44
6.13
6.47
5.69
5.95
31
49
bps
6.29
5.81
48
bps
Efficiency ratio(10)
53.78
52.58
54.64
48.07
57.50
120
(4)
%
53.19
54.32
(113)
Operating efficiency ratio(11)
45.38
45.54
46.97
44.24
53.34
(16)
(8)
45.45
48.79
(334)
Effective income tax rate for continuing operations
22.6
20.7
16.2
31.3
37.2
190
(15)
21.7
32.9
(11)
%
Employees (period-end, in thousands)
52.0
51.7
52.0
52.5
53.1
1
%
(2)
52.0
53.1
(2)
Credit Quality Metrics
Allowance for credit losses
$
12,346
$
14,017
$
15,564
$
16,129
$
16,832
(12)
%
(27)
%
$
12,346
$
16,832
(27)
%
Allowance coverage ratio
4.95
%
5.77
%
6.19
%
6.50
%
6.69
%
(82)
bps
(174)
bps
4.95
%
6.69
%
(174)
bps
Net charge-offs
$
541
$
740
$
856
$
1,073
$
1,505
(27)
%
(64)
%
$
1,281
$
3,296
(61)
%
Net charge-off rate(12)
0.88
%
1.21
%
1.38
%
1.72
%
2.38
%
(33)
bps
(150)
bps
1.04
%
2.55
%
(151)
bps
30+ day performing delinquency rate(13)
1.75
1.82
2.41
1.97
2.09
(7)
(34)
1.75
2.09
(34)
30+ day delinquency rate(13)
1.89
1.98
2.61
2.22
2.30
(9)
(41)
1.89
2.30
(41)
Capital Ratios(14)
Common equity Tier 1 capital
14.5
%
14.6
%
13.7
%
13.0
%
12.4
%
(10)
bps
210
bps
14.5
%
12.4
%
210
bps
Tier 1 capital
16.6
16.2
15.3
14.8
14.2
40
240
16.6
14.2
240
Total capital
18.8
18.6
17.7
17.3
16.7
20
210
18.8
16.7
210
Tier 1 leverage
12.4
11.7
11.2
10.6
10.3
70
210
12.4
10.3
210
Tangible common equity ("TCE")(15)
10.6
10.1
10.0
9.4
8.8
50
180
10.6
8.8
180
CAPITAL ONE FINANCIAL CORPORATION (COF)
Table 3: Consolidated Statements of Income
2021 Q2 vs.
Six Months Ended June 30,
2021
2021
2020
2020
2020
2021
2020
2021 vs.
(Dollars in millions, except per share data and as noted)
Q2
Q1
Q4
Q3
Q2
Q1
Q2
2021
2020
2020
Interest income:
Loans, including loans held for sale
$
5,753
$
5,854
$
5,954
$
5,758
$
5,820
(2)
%
(1)
%
$
11,607
$
12,362
(6)
%
Investment securities
370
391
422
443
482
(5)
(23)
761
1,012
(25)
Other
16
16
15
14
16
—
—
32
53
(40)
Total interest income
6,139
6,261
6,391
6,215
6,318
(2)
(3)
12,400
13,427
(8)
Interest expense:
Deposits
237
269
347
476
611
(12)
(61)
506
1,342
(62)
Securitized debt obligations
28
32
34
43
56
(13)
(50)
60
155
(61)
Senior and subordinated notes
122
129
128
132
180
(5)
(32)
251
419
(40)
Other borrowings
9
9
9
9
11
—
(18)
18
26
(31)
Total interest expense
396
439
518
660
858
(10)
(54)
835
1,942
(57)
Net interest income
5,743
5,822
5,873
5,555
5,460
(1)
5
11,565
11,485
1
Provision (benefit) for credit losses
(1,160)
(823)
264
331
4,246
41
**
(1,983)
9,669
**
Net interest income after provision for credit losses
6,903
6,645
5,609
5,224
1,214
4
**
13,548
1,816
**
Non-interest income:
Interchange fees, net
1,016
817
818
775
672
24
51
1,833
1,424
29
Service charges and other customer-related fees
384
352
338
320
258
9
49
736
585
26
Net securities gains
—
4
—
25
—
**
—
4
—
**
Other
231
118
308
706
166
96
39
349
311
12
Total non-interest income
1,631
1,291
1,464
1,826
1,096
26
49
2,922
2,320
26
Non-interest expense:
Salaries and associate benefits
1,781
1,847
1,755
1,719
1,704
(4)
5
3,628
3,331
9
Occupancy and equipment
523
472
572
506
523
11
—
995
1,040
(4)
Marketing
620
501
563
283
273
24
127
1,121
764
47
Professional services
341
292
394
327
304
17
12
633
591
7
Communications and data processing
315
302
295
310
308
4
2
617
610
1
Amortization of intangibles
5
6
8
14
16
(17)
(69)
11
38
(71)
Other
381
320
422
389
642
19
(41)
701
1,125
(38)
Total non-interest expense
3,966
3,740
4,009
3,548
3,770
6
5
7,706
7,499
3
Income (loss) from continuing operations before income taxes
4,568
4,196
3,064
3,502
(1,460)
9
**
8,764
(3,363)
**
Income tax provision (benefit)
1,031
869
496
1,096
(543)
19
**
1,900
(1,106)
**
Income (loss) from continuing operations, net of tax
3,537
3,327
2,568
2,406
(917)
6
**
6,864
(2,257)
**
Loss from discontinued operations, net of tax
(1)
(2)
(2)
—
(1)
(50)
—
(3)
(1)
**
Net income (loss)
3,536
3,325
2,566
2,406
(918)
6
**
6,861
(2,258)
**
Dividends and undistributed earnings allocated to participating securities(2)
(30)
(28)
(19)
(20)
(1)
7
**
(58)
(4)
**
Preferred stock dividends
(60)
(61)
(68)
(67)
(90)
(2)
(33)
(121)
(145)
(17)
Issuance cost for redeemed preferred stock(3)
—
—
(17)
—
—
—
—
—
(22)
**
Net income (loss) available to common stockholders
$
3,446
$
3,236
$
2,462
$
2,319
$
(1,009)
6
**
$
6,682
$
(2,429)
**
2021 Q2 vs.
Six Months Ended June 30,
2021
2021
2020
2020
2020
2021
2020
2021 vs.
(Dollars in millions, except per share data and as noted)
Q2
Q1
Q4
Q3
Q2
Q1
Q2
2021
2020
2020
Basic earnings per common share:(2)
Net income (loss) from continuing operations
$
7.65
$
7.06
$
5.36
$
5.07
$
(2.21)
8
%
**
$
14.70
$
(5.31)
**
Net income (loss) per basic common share
$
7.65
$
7.06
$
5.36
$
5.07
$
(2.21)
8
**
$
14.70
$
(5.31)
**
Diluted earnings per common share:(2)
Net income (loss) from continuing operations
$
7.62
$
7.03
$
5.35
$
5.06
$
(2.21)
8
**
$
14.65
$
(5.31)
**
Net income (loss) per diluted common share
$
7.62
$
7.03
$
5.35
$
5.06
$
(2.21)
8
**
$
14.65
$
(5.31)
**
Weighted-average common shares outstanding (in millions):
Basic common shares
450.6
458.6
459.1
457.8
456.7
(2)
(1)
%
454.6
457.1
(1)
%
Diluted common shares
452.3
460.1
460.2
458.5
456.7
(2)
(1)
456.2
457.1
—
CAPITAL ONE FINANCIAL CORPORATION (COF)
Table 4: Consolidated Balance Sheets
2021 Q2 vs.
2021
2021
2020
2020
2020
2021
2020
(Dollars in millions)
Q2
Q1
Q4
Q3
Q2
Q1
Q2
Assets:
Cash and cash equivalents:
Cash and due from banks
$
5,312
$
4,670
$
4,708
$
4,267
$
4,583
14
%
16
%
Interest-bearing deposits and other short-term investments
29,534
45,825
35,801
39,839
51,235
(36)
(42)
Total cash and cash equivalents
34,846
50,495
40,509
44,106
55,818
(31)
(38)
Restricted cash for securitization investors
242
1,779
262
895
740
(86)
(67)
Securities available for sale
101,766
99,165
100,445
99,853
87,859
3
16
Loans held for investment:
Unsecuritized loans held for investment
226,130
219,182
225,698
217,878
222,310
3
2
Loans held in consolidated trusts
23,467
23,949
25,926
30,345
29,202
(2)
(20)
Total loans held for investment
249,597
243,131
251,624
248,223
251,512
3
(1)
Allowance for credit losses
(12,346)
(14,017)
(15,564)
(16,129)
(16,832)
(12)
(27)
Net loans held for investment
237,251
229,114
236,060
232,094
234,680
4
1
Loans held for sale
6,522
2,896
2,710
3,433
711
125
**
Premises and equipment, net
4,227
4,277
4,287
4,333
4,324
(1)
(2)
Interest receivable
1,372
1,380
1,471
1,551
1,574
(1)
(13)
Goodwill
14,654
14,654
14,653
14,648
14,645
—
—
Other assets
22,540
21,415
21,205
20,970
20,945
5
8
Total assets
$
423,420
$
425,175
$
421,602
$
421,883
$
421,296
—
1
2021 Q2 vs.
2021
2021
2020
2020
2020
2021
2020
(Dollars in millions)
Q2
Q1
Q4
Q3
Q2
Q1
Q2
Liabilities:
Interest payable
$
301
$
288
$
352
$
332
$
380
5
%
(21)
%
Deposits:
Non-interest-bearing deposits
34,994
34,003
31,142
29,633
29,055
3
20
Interest-bearing deposits
271,314
276,325
274,300
276,092
275,183
(2)
(1)
Total deposits
306,308
310,328
305,442
305,725
304,238
(1)
1
Securitized debt obligations
10,561
12,071
12,414
13,566
15,761
(13)
(33)
Other debt:
Federal funds purchased and securities loaned or sold under agreements to repurchase
845
842
668
702
573
—
47
Senior and subordinated notes
24,878
25,467
27,382
28,448
28,481
(2)
(13)
Other borrowings
59
70
75
79
85
(16)
(31)
Total other debt
25,782
26,379
28,125
29,229
29,139
(2)
(12)
Other liabilities
15,844
14,921
15,065
14,607
15,733
6
1
Total liabilities
358,796
363,987
361,398
363,459
365,251
(1)
(2)
Stockholders' equity:
Preferred stock
0
0
0
0
0
—
—
Common stock
7
7
7
7
7
—
—
Additional paid-in capital, net
35,472
33,671
33,480
33,793
33,556
5
6
Retained earnings
46,461
43,167
40,088
37,653
35,361
8
31
Accumulated other comprehensive income
1,792
1,783
3,494
3,833
3,981
1
(55)
Treasury stock, at cost
(19,108)
(17,440)
(16,865)
(16,862)
(16,860)
10
13
Total stockholders' equity
64,624
61,188
60,204
58,424
56,045
6
15
Total liabilities and stockholders' equity
$
423,420
$
425,175
$
421,602
$
421,883
$
421,296
—
1
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 $175 million in Q2 2021, $180 million in Q1 2021, $177 million in Q4 2020, $235 million in Q3 2020 and $318 million in Q2 2020 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 December 1, 2020, we redeemed all outstanding shares of our fixed rate 6.20% non-cumulative perpetual preferred stock Series F, which reduced our net income available to common shareholders by $17 million in Q4 2020. On March 2, 2020, we redeemed all outstanding shares of our fixed rate 6.00% non-cumulative perpetual preferred stock Series B, which increased our net loss available to common shareholders by $22 million in Q1 2020.
(4)
Tangible book value per common share is a non-GAAP measure calculated based on tangible common equity divided by common shares outstanding. See "Table 15: Calculation of Regulatory Capital Measures and Reconciliation of Non-GAAP Measures" for additional information on non-GAAP measures.
(5)
Total net revenue margin is calculated based on annualized 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 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.
(9)
Return on average tangible common equity ("ROTCE") 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 tangible common equity ("TCE"). Our calculation of return on average TCE may not be comparable to similarly-titled measures reported by other companies. See "Table 15: Calculation of Regulatory Capital Measures and Reconciliation of Non-GAAP Measures" for additional information on non-GAAP measures.
(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)
Metrics include the impact of COVID-19 customer assistance programs where applicable.
(14)
Capital ratios as of the end of Q2 2021 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.
(15)
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
2021 Q2
2021 Q1
2020 Q2
(Dollars in millions, except as noted)
Average Balance
Interest Income/ Expense
Yield/Rate
Average Balance
Interest Income/ Expense
Yield/Rate
Average Balance
Interest Income/ Expense
Yield/Rate
Interest-earning assets:
Loans, including loans held for sale
$
249,280
$
5,753
9.23
%
$
246,675
$
5,854
9.49
%
$
254,402
$
5,820
9.15
%
Investment securities
100,071
370
1.48
98,296
391
1.59
81,095
482
2.38
Cash equivalents and other
40,778
16
0.16
43,601
16
0.15
42,648
16
0.15
Total interest-earning assets
$
390,129
$
6,139
6.29
$
388,572
$
6,261
6.45
$
378,145
$
6,318
6.68
Interest-bearing liabilities:
Interest-bearing deposits
$
273,476
$
237
0.35
$
273,358
$
269
0.39
$
261,256
$
611
0.94
Securitized debt obligations
10,890
28
1.03
12,240
32
1.05
16,432
56
1.37
Senior and subordinated notes
25,487
122
1.92
26,968
129
1.91
31,294
180
2.30
Other borrowings and liabilities
2,198
9
1.67
2,210
9
1.62
3,554
11
1.21
Total interest-bearing liabilities
$
312,051
$
396
0.50
$
314,776
$
439
0.56
$
312,536
$
858
1.10
Net interest income/spread
$
5,743
5.79
$
5,822
5.89
$
5,460
5.58
Impact of non-interest-bearing funding
0.10
0.10
0.20
Net interest margin
5.89
%
5.99
%
5.78
%
Six Months Ended June 30,
2021
2020
Average Balance
Interest Income/ Expense
Yield/Rate
Average Balance
Interest Income/ Expense
Yield/Rate
(Dollars in millions, except as noted)
Interest-earning assets:
Loans, including loans held for sale
$
247,984
$
11,607
9.36
%
$
259,017
$
12,362
9.55
%
Investment securities
99,189
761
1.53
79,654
1,012
2.54
Cash equivalents and other
42,182
32
0.15
28,075
53
0.38
Total interest-earning assets
$
389,355
$
12,400
6.37
$
366,746
$
13,427
7.32
Interest-bearing liabilities:
Interest-bearing deposits
$
273,417
$
506
0.37
$
251,185
$
1,342
1.07
Securitized debt obligations
11,561
60
1.04
17,243
155
1.80
Senior and subordinated notes
26,223
251
1.92
31,318
419
2.67
Other borrowings and liabilities
2,205
18
1.65
3,667
26
1.42
Total interest-bearing liabilities
$
313,406
$
835
0.53
$
303,413
$
1,942
1.28
Net interest income/spread
$
11,565
5.84
$
11,485
6.04
Impact of non-interest-bearing funding
0.10
0.22
Net interest margin
5.94
%
6.26
%
CAPITAL ONE FINANCIAL CORPORATION (COF)
Table 7: Loan Information and Performance Statistics
2021 Q2 vs.
Six Months Ended June 30,
2021
2021
2020
2020
2020
2021
2020
2021
2020
2021 vs. 2020
(Dollars in millions, except as noted)
Q2
Q1
Q4
Q3
Q2
Q1
Q2
Loans Held for Investment (Period-End)
Credit card:
Domestic credit card(1)
$
95,309
$
91,099
$
98,504
$
95,541
$
99,390
5
%
(4)
%
$
95,309
$
99,390
(4)
%
International card businesses(2)
5,708
8,028
8,452
8,100
7,920
(29)
(28)
5,708
7,920
(28)
Total credit card
101,017
99,127
106,956
103,641
107,310
2
(6)
101,017
107,310
(6)
Consumer banking:
Auto
71,713
67,059
65,762
65,394
63,319
7
13
71,713
63,319
13
Retail banking
3,046
3,143
3,126
3,294
3,393
(3)
(10)
3,046
3,393
(10)
Total consumer banking
74,759
70,202
68,888
68,688
66,712
6
12
74,759
66,712
12
Commercial banking:
Commercial and multifamily real estate(3)
29,616
30,008
30,681
31,197
30,953
(1)
(4)
29,616
30,953
(4)
Commercial and industrial
44,205
43,794
45,099
44,697
46,537
1
(5)
44,205
46,537
(5)
Total commercial banking
73,821
73,802
75,780
75,894
77,490
—
(5)
73,821
77,490
(5)
Total loans held for investment
249,597
243,131
251,624
248,223
251,512
3
(1)
249,597
251,512
(1)
Loans Held for Investment (Average)
Credit card:
Domestic credit card
$
91,535
$
92,594
$
95,453
$
97,306
$
100,996
(1)
%
(9)
%
$
92,062
$
107,354
(14)
%
International card businesses
8,139
7,940
8,108
8,061
7,752
3
5
8,040
8,408
(4)
Total credit card
99,674
100,534
103,561
105,367
108,748
(1)
(8)
100,102
115,762
(14)
Consumer banking:
Auto
69,543
66,185
65,590
64,476
61,798
5
13
67,873
61,401
11
Retail banking
3,162
3,049
3,218
3,346
3,053
4
4
3,106
2,860
9
Total consumer banking
72,705
69,234
68,808
67,822
64,851
5
12
70,979
64,261
10
Commercial banking:
Commercial and multifamily real estate
30,124
29,856
30,825
30,918
31,723
1
(5)
29,991
31,402
(4)
Commercial and industrial
43,960
44,313
44,495
45,404
48,036
(1)
(8)
44,135
46,699
(5)
Total commercial banking
74,084
74,169
75,320
76,322
79,759
—
(7)
74,126
78,101
(5)
Total average loans held for investment
$
246,463
$
243,937
$
247,689
$
249,511
$
253,358
1
(3)
$
245,207
$
258,124
(5)
2021 Q2 vs.
Six Months Ended June 30,
2021
2021
2020
2020
2020
2021
2020
2021
2020
2021 vs. 2020
Q2
Q1
Q4
Q3
Q2
Q1
Q2
Net Charge-Off (Recovery) Rates
Credit card:
Domestic credit card
2.28
%
2.54
%
2.69
%
3.64
%
4.53
%
(26)
bps
(225)
bps
2.41
%
4.61
%
(220)
bps
International card businesses
2.41
2.30
1.86
2.89
3.47
11
(106)
2.36
4.11
(175)
Total credit card
2.29
2.52
2.63
3.58
4.46
(23)
(217)
2.41
4.57
(216)
Consumer banking:
Auto
(0.12)
0.47
0.47
0.23
1.16
(59)
(128)
0.17
1.33
(116)
Retail banking
1.41
1.68
1.88
1.38
1.78
(27)
(37)
1.54
2.05
(51)
Total consumer banking
(0.06)
0.52
0.53
0.28
1.19
(58)
(125)
0.23
1.36
(113)
Commercial banking:
Commercial and multifamily real estate
0.04
0.06
0.02
0.41
0.09
(2)
(5)
0.05
0.04
1
Commercial and industrial
(0.21)
0.11
0.74
0.45
0.78
(32)
(99)
(0.05)
0.87
(92)
Total commercial banking
(0.11)
0.09
0.45
0.43
0.51
(20)
(62)
(0.01)
0.54
(55)
Total net charge-offs
0.88
1.21
1.38
1.72
2.38
(33)
(150)
1.04
2.55
(151)
30+ Day Performing Delinquency Rates(4)
Credit card:
Domestic credit card
1.68
%
2.24
%
2.42
%
2.21
%
2.74
%
(56)
bps
(106)
bps
1.68
%
2.74
%
(106)
bps
International card businesses
2.89
2.51
2.61
2.15
2.71
38
18
2.89
2.71
18
Total credit card
1.75
2.26
2.44
2.20
2.74
(51)
(99)
1.75
2.74
(99)
Consumer banking:
Auto
3.26
3.12
4.78
3.76
3.28
14
(2)
3.26
3.28
(2)
Retail banking
0.79
1.02
1.32
0.83
0.89
(23)
(10)
0.79
0.89
(10)
Total consumer banking
3.16
3.03
4.62
3.62
3.16
13
—
3.16
3.16
—
Nonperforming Loans and Nonperforming Assets Rates(5)(6)
Credit card:
International card businesses
0.20
%
0.17
%
0.24
%
0.25
%
0.29
%
3
bps
(9)
bps
0.20
%
0.29
%
(9)
bps
Total credit card
0.01
0.01
0.02
0.02
0.02
—
(1)
0.01
0.02
(1)
Consumer banking:
Auto
0.29
0.29
0.45
0.36
0.41
—
(12)
0.29
0.41
(12)
Retail banking
1.75
1.16
0.96
0.77
0.70
59
105
1.75
0.70
105
Total consumer banking
0.35
0.33
0.47
0.38
0.43
2
(8)
0.35
0.43
(8)
Commercial banking:
Commercial and multifamily real estate
1.02
0.78
0.65
0.58
0.54
24
48
1.02
0.54
48
Commercial and industrial
1.03
1.02
1.00
1.31
1.06
1
(3)
1.03
1.06
(3)
Total commercial banking
1.03
0.92
0.86
1.01
0.85
11
18
1.03
0.85
18
Total nonperforming loans
0.41
0.38
0.40
0.42
0.38
3
3
0.41
0.38
3
Total nonperforming assets
0.43
0.40
0.41
0.44
0.39
3
4
0.43
0.39
4
CAPITAL ONE FINANCIAL CORPORATION (COF)
Table 8: Allowance for Credit Losses and Reserve for Unfunded Lending Commitments Activity
Three Months Ended June 30, 2021
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 March 31, 2021
$
9,572
$
500
$
10,072
$
2,405
$
93
$
2,498
$
1,447
$
14,017
Charge-offs
(874)
(93)
(967)
(245)
(15)
(260)
(8)
(1,235)
Recoveries
352
44
396
267
4
271
27
694
Net recoveries (charge-offs)
(522)
(49)
(571)
22
(11)
11
19
(541)
Provision (benefit) for credit losses
(561)
(74)
(635)
(305)
(1)
(306)
(196)
(1,137)
Allowance build (release) for credit losses
(1,083)
(123)
(1,206)
(283)
(12)
(295)
(177)
(1,678)
Other changes(7)
—
7
7
—
—
—
—
7
Balance as of June 30, 2021
8,489
384
8,873
2,122
81
2,203
1,270
12,346
Reserve for unfunded lending commitments:
Balance as of March 31, 2021
—
—
—
—
—
—
187
187
Provision (benefit) for losses on unfunded lending commitments
—
—
—
—
—
—
(23)
(23)
Balance as of June 30, 2021
—
—
—
—
—
—
164
164
Combined allowance and reserve as of June 30, 2021
$
8,489
$
384
$
8,873
$
2,122
$
81
$
2,203
$
1,434
$
12,510
Six Months Ended June 30, 2021
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, 2020
$
10,650
$
541
$
11,191
$
2,615
$
100
$
2,715
$
1,658
$
15,564
Charge-offs
(1,778)
(182)
(1,960)
(569)
(33)
(602)
(27)
(2,589)
Recoveries
669
87
756
513
9
522
30
1,308
Net recoveries (charge-offs)
(1,109)
(95)
(1,204)
(56)
(24)
(80)
3
(1,281)
Provision (benefit) for credit losses
(1,052)
(75)
(1,127)
(437)
5
(432)
(391)
(1,950)
Allowance build (release) for credit losses
(2,161)
(170)
(2,331)
(493)
(19)
(512)
(388)
(3,231)
Other changes(7)
—
13
13
—
—
—
—
13
Balance as of June 30, 2021
8,489
384
8,873
2,122
81
2,203
1,270
12,346
Reserve for unfunded lending commitments:
Balance as of December 31, 2020
—
—
—
—
—
—
195
195
Provision (benefit) for losses on unfunded lending commitments
—
—
—
—
—
—
(31)
(31)
Balance as of June 30, 2021
—
—
—
—
—
—
164
164
Combined allowance and reserve as of June 30, 2021
$
8,489
$
384
$
8,873
$
2,122
$
81
$
2,203
$
1,434
$
12,510
CAPITAL ONE FINANCIAL CORPORATION (COF)
Table 9: Financial Summary—Business Segment Results
Three Months Ended June 30, 2021
Six Months Ended June 30, 2021
(Dollars in millions)
Credit Card
Consumer Banking
Commercial Banking(8)
Other(8)
Total
Credit Card
Consumer Banking
Commercial Banking(8)
Other(8)
Total
Net interest income (loss)
$
3,217
$
2,101
$
460
$
(35)
$
5,743
$
6,589
$
4,131
$
980
$
(135)
$
11,565
Non-interest income (loss)
1,253
144
257
(23)
1,631
2,282
285
497
(142)
2,922
Total net revenue (loss)
4,470
2,245
717
(58)
7,374
8,871
4,416
1,477
(277)
14,487
Provision (benefit) for credit losses
(635)
(306)
(219)
—
(1,160)
(1,127)
(432)
(422)
(2)
(1,983)
Non-interest expense
2,263
1,123
417
163
3,966
4,398
2,240
836
232
7,706
Income (loss) from continuing operations before income taxes
2,842
1,428
519
(221)
4,568
5,600
2,608
1,063
(507)
8,764
Income tax provision (benefit)
672
337
123
(101)
1,031
1,325
615
251
(291)
1,900
Income (loss) from continuing operations, net of tax
$
2,170
$
1,091
$
396
$
(120)
$
3,537
$
4,275
$
1,993
$
812
$
(216)
$
6,864
Three Months Ended March 31, 2021
(Dollars in millions)
Credit Card
Consumer Banking
Commercial Banking(8)
Other(8)
Total
Net interest income (loss)
$
3,372
$
2,030
$
520
$
(100)
$
5,822
Non-interest income (loss)
1,029
141
240
(119)
1,291
Total net revenue (loss)
4,401
2,171
760
(219)
7,113
Provision (benefit) for credit losses
(492)
(126)
(203)
(2)
(823)
Non-interest expense
2,135
1,117
419
69
3,740
Income (loss) from continuing operations before income taxes
2,758
1,180
544
(286)
4,196
Income tax provision (benefit)
653
278
128
(190)
869
Income (loss) from continuing operations, net of tax
$
2,105
$
902
$
416
$
(96)
$
3,327
Three Months Ended June 30, 2020
Six Months Ended June 30, 2020
(Dollars in millions)
Credit Card
Consumer Banking
Commercial Banking(8)
Other(8)
Total
Credit Card
Consumer Banking
Commercial Banking(8)
Other(8)
Total
Net interest income (loss)
$
3,369
$
1,665
$
518
$
(92)
$
5,460
$
7,071
$
3,322
$
1,009
$
83
$
11,485
Non-interest income (loss)
845
97
180
(26)
1,096
1,756
223
418
(77)
2,320
Total net revenue (loss)
4,214
1,762
698
(118)
6,556
8,827
3,545
1,427
6
13,805
Provision (benefit) for credit losses
2,944
876
427
(1)
4,246
6,646
1,736
1,283
4
9,669
Non-interest expense
1,969
1,036
425
340
3,770
4,177
2,027
837
458
7,499
Loss from continuing operations before income taxes
(699)
(150)
(154)
(457)
(1,460)
(1,996)
(218)
(693)
(456)
(3,363)
Income tax benefit
(166)
(36)
(36)
(305)
(543)
(472)
(52)
(164)
(418)
(1,106)
Loss from continuing operations, net of tax
$
(533)
$
(114)
$
(118)
$
(152)
$
(917)
$
(1,524)
$
(166)
$
(529)
$
(38)
$
(2,257)
CAPITAL ONE FINANCIAL CORPORATION (COF)
Table 10: Financial & Statistical Summary—Credit Card Business
2021 Q2 vs.
Six Months Ended June 30,
2021
2021
2020
2020
2020
2021
2020
2021 vs.
(Dollars in millions, except as noted)
Q2
Q1
Q4
Q3
Q2
Q1
Q2
2021
2020
2020
Credit Card
Earnings:
Net interest income
$
3,217
$
3,372
$
3,413
$
3,292
$
3,369
(5)
%
(5)
%
$
6,589
$
7,071
(7)
%
Non-interest income
1,253
1,029
1,054
1,013
845
22
48
2,282
1,756
30
Total net revenue
4,470
4,401
4,467
4,305
4,214
2
6
8,871
8,827
—
Provision (benefit) for credit losses
(635)
(492)
231
450
2,944
29
**
(1,127)
6,646
**
Non-interest expense
2,263
2,135
2,311
2,003
1,969
6
15
4,398
4,177
5
Income (loss) from continuing operations before income taxes
2,842
2,758
1,925
1,852
(699)
3
**
5,600
(1,996)
**
Income tax provision (benefit)
672
653
454
438
(166)
3
**
1,325
(472)
**
Income (loss) from continuing operations, net of tax
$
2,170
$
2,105
$
1,471
$
1,414
$
(533)
3
**
$
4,275
$
(1,524)
**
Selected performance metrics:
Period-end loans held for investment(1)(2)
$
101,017
$
99,127
$
106,956
$
103,641
$
107,310
2
(6)
$
101,017
$
107,310
(6)
Average loans held for investment
99,674
100,534
103,561
105,367
108,748
(1)
(8)
100,102
115,762
(14)
Average yield on loans outstanding(9)
14.04
%
14.49
%
14.24
%
13.83
%
13.72
%
(45)
bps
32
bps
14.26
%
14.11
%
15
bps
Total net revenue margin(10)
17.59
17.17
16.92
16.34
15.50
42
209
17.38
15.25
213
Net charge-off rate
2.29
2.52
2.63
3.58
4.46
(23)
(217)
2.41
4.57
(216)
30+ day performing delinquency rate
1.75
2.26
2.44
2.20
2.74
(51)
(99)
1.75
2.74
(99)
30+ day delinquency rate
1.75
2.27
2.45
2.21
2.75
(52)
(100)
1.75
2.75
(100)
Nonperforming loan rate(5)
0.01
0.01
0.02
0.02
0.02
—
(1)
0.01
0.02
(1)
Purchase volume(11)
$
132,676
$
108,333
$
117,141
$
107,102
$
90,149
22
%
47
%
$
241,009
$
190,069
27
%
2021 Q2 vs.
Six Months Ended June 30,
2021
2021
2020
2020
2020
2021
2020
2021 vs.
(Dollars in millions, except as noted)
Q2
Q1
Q4
Q3
Q2
Q1
Q2
2021
2020
2020
Domestic Card
Earnings:
Net interest income
$
2,944
$
3,095
$
3,129
$
2,995
$
3,094
(5)
%
(5)
%
$
6,039
$
6,475
(7)
%
Non-interest income
1,183
959
994
952
795
23
49
2,142
1,637
31
Total net revenue
4,127
4,054
4,123
3,947
3,889
2
6
8,181
8,112
1
Provision (benefit) for credit losses
(561)
(491)
231
378
2,906
14
**
(1,052)
6,370
**
Non-interest expense
2,034
1,923
2,063
1,802
1,776
6
15
3,957
3,760
5
Income (loss) from continuing operations before income taxes
2,654
2,622
1,829
1,767
(793)
1
**
5,276
(2,018)
**
Income tax provision (benefit)
626
619
433
419
(188)
1
**
1,245
(478)
**
Income (loss) from continuing operations, net of tax
$
2,028
$
2,003
$
1,396
$
1,348
$
(605)
1
**
$
4,031
$
(1,540)
**
Selected performance metrics:
Period-end loans held for investment(1)
$
95,309
$
91,099
$
98,504
$
95,541
$
99,390
5
(4)
$
95,309
$
99,390
(4)
Average loans held for investment
91,535
92,594
95,453
97,306
100,996
(1)
(9)
92,062
107,354
(14)
Average yield on loans outstanding(9)
13.91
%
14.34
%
14.07
%
13.57
%
13.52
%
(43)
bps
39
bps
14.13
%
13.93
%
20
bps
Total net revenue margin(10)
17.66
17.15
16.91
16.22
15.40
51
226
17.40
15.11
229
Net charge-off rate
2.28
2.54
2.69
3.64
4.53
(26)
(225)
2.41
4.61
(220)
30+ day performing delinquency rate
1.68
2.24
2.42
2.21
2.74
(56)
(106)
1.68
2.74
(106)
Purchase volume(11)
$
122,456
$
99,960
$
107,572
$
98,107
$
82,860
23
%
48
%
$
222,416
$
175,108
27
%
Refreshed FICO scores:(12)
Greater than 660
72
%
70
%
69
%
69
%
67
%
2
5
72
%
67
%
5
660 or below
28
30
31
31
33
(2)
(5)
28
33
(5)
Total
100
%
100
%
100
%
100
%
100
%
100
%
100
%
CAPITAL ONE FINANCIAL CORPORATION (COF)
Table 11: Financial & Statistical Summary—Consumer Banking Business
2021 Q2 vs.
Six Months Ended June 30,
2021
2021
2020
2020
2020
2021
2020
2021 vs.
(Dollars in millions, except as noted)
Q2
Q1
Q4
Q3
Q2
Q1
Q2
2021
2020
2020
Consumer Banking
Earnings:
Net interest income
$
2,101
$
2,030
$
2,012
$
1,904
$
1,665
3
%
26
%
$
4,131
$
3,322
24
%
Non-interest income
144
141
136
107
97
2
48
285
223
28
Total net revenue
2,245
2,171
2,148
2,011
1,762
3
27
4,416
3,545
25
Provision (benefit) for credit losses
(306)
(126)
60
(43)
876
143
**
(432)
1,736
**
Non-interest expense
1,123
1,117
1,121
1,011
1,036
1
8
2,240
2,027
11
Income (loss) from continuing operations before income taxes
1,428
1,180
967
1,043
(150)
21
**
2,608
(218)
**
Income tax provision (benefit)
337
278
230
247
(36)
21
**
615
(52)
**
Income (loss) from continuing operations, net of tax
$
1,091
$
902
$
737
$
796
$
(114)
21
**
$
1,993
$
(166)
**
Selected performance metrics:
Period-end loans held for investment
$
74,759
$
70,202
$
68,888
$
68,688
$
66,712
6
12
$
74,759
$
66,712
12
Average loans held for investment
72,705
69,234
68,808
67,822
64,851
5
12
70,979
64,261
10
Average yield on loans held for investment(9)
7.99
%
8.16
%
8.28
%
8.36
%
8.41
%
(17)
bps
(42)
bps
8.07
%
8.44
%
(37)
bps
Auto loan originations
$
12,959
$
8,833
$
7,371
$
8,979
$
8,292
47
%
56
%
$
21,792
$
15,931
37
%
Period-end deposits
251,155
254,001
249,815
249,684
246,804
(1)
2
251,155
246,804
2
Average deposits
252,488
249,499
249,419
248,418
232,293
1
9
251,002
223,682
12
Average deposits interest rate
0.31
%
0.36
%
0.47
%
0.66
%
0.89
%
(5)
bps
(58)
bps
0.33
%
0.97
%
(64)
bps
Net charge-off (recovery) rate
(0.06)
0.52
0.53
0.28
1.19
(58)
(125)
0.23
1.36
(113)
30+ day performing delinquency rate
3.16
3.03
4.62
3.62
3.16
13
—
3.16
3.16
—
30+ day delinquency rate
3.40
3.25
5.00
3.90
3.48
15
(8)
3.40
3.48
(8)
Nonperforming loan rate(5)
0.35
0.33
0.47
0.38
0.43
2
(8)
0.35
0.43
(8)
Nonperforming asset rate(6)
0.40
0.39
0.54
0.43
0.46
1
(6)
0.40
0.46
(6)
Auto—At origination FICO scores:(13)
Greater than 660
48
%
47
%
46
%
46
%
46
%
1
%
2
%
48
%
46
%
2
%
621 - 660
20
20
20
20
20
—
—
20
20
—
620 or below
32
33
34
34
34
(1)
(2)
32
34
(2)
Total
100
%
100
%
100
%
100
%
100
%
100
%
100
%
CAPITAL ONE FINANCIAL CORPORATION (COF)
Table 12: Financial & Statistical Summary—Commercial Banking Business
2021 Q2 vs.
Six Months Ended June 30,
2021
2021
2020
2020
2020
2021
2020
2021 vs.
(Dollars in millions, except as noted)
Q2
Q1
Q4
Q3
Q2
Q1
Q2
2021
2020
2020
Commercial Banking
Earnings:
Net interest income
$
460
$
520
$
522
$
517
$
518
(12)
%
(11)
%
$
980
$
1,009
(3)
%
Non-interest income
257
240
268
237
180
7
43
497
418
19
Total net revenue(8)
717
760
790
754
698
(6)
3
1,477
1,427
4
Provision (benefit) for credit losses
(219)
(203)
(28)
(74)
427
8
**
(422)
1,283
**
Non-interest expense
417
419
445
424
425
—
(2)
836
837
—
Income (loss) from continuing operations before income taxes
519
544
373
404
(154)
(5)
**
1,063
(693)
**
Income tax provision (benefit)
123
128
88
95
(36)
(4)
**
251
(164)
**
Income (loss) from continuing operations, net of tax
$
396
$
416
$
285
$
309
$
(118)
(5)
**
$
812
$
(529)
**
Selected performance metrics:
Period-end loans held for investment(3)
$
73,821
$
73,802
$
75,780
$
75,894
$
77,490
—
(5)
$
73,821
$
77,490
(5)
Average loans held for investment
74,084
74,169
75,320
76,322
79,759
—
(7)
74,126
78,101
(5)
Average yield on loans held for investment(8)(9)
2.72
%
2.76
%
2.83
%
2.82
%
3.00
%
(4)
bps
(28)
bps
2.74
%
3.43
%
(69)
bps
Period-end deposits
$
42,973
$
41,552
$
39,590
$
36,783
$
35,669
3
%
20
%
$
42,973
$
35,669
20
%
Average deposits
42,311
40,107
38,676
36,278
34,635
5
22
41,215
33,437
23
Average deposits interest rate
0.14
%
0.18
%
0.23
%
0.25
%
0.30
%
(4)
bps
(16)
bps
0.16
%
0.58
%
(42)
bps
Net charge-off (recovery) rate
(0.11)
0.09
0.45
0.43
0.51
(20)
(62)
(0.01)
0.54
(55)
Nonperforming loan rate(5)
1.03
0.92
0.86
1.01
0.85
11
18
1.03
0.85
18
Nonperforming asset rate(6)
1.03
0.92
0.86
1.01
0.85
11
18
1.03
0.85
18
Risk category:(14)
Noncriticized
$
67,481
$
66,299
$
67,964
$
68,533
$
70,881
2
%
(5)
%
$
67,481
$
70,881
(5)
%
Criticized performing
5,581
6,821
7,166
6,593
5,949
(18)
(6)
5,581
5,949
(6)
Criticized nonperforming
759
682
650
768
660
11
15
759
660
15
Total commercial banking loans
$
73,821
$
73,802
$
75,780
$
75,894
$
77,490
—
(5)
$
73,821
$
77,490
(5)
Risk category as a percentage of period-end loans held for investment:(14)
Noncriticized
91.4
%
89.9
%
89.6
%
90.3
%
91.4
%
150
bps
—
91.4
%
91.4
%
—
Criticized performing
7.6
9.2
9.5
8.7
7.7
(160)
(10)
bps
7.6
7.7
(10)
bps
Criticized nonperforming
1.0
0.9
0.9
1.0
0.9
10
10
1.0
0.9
10
Total commercial banking loans
100.0
%
100.0
%
100.0
%
100.0
%
100.0
%
100.0
%
100.0
%
CAPITAL ONE FINANCIAL CORPORATION (COF)
Table 13: Financial & Statistical Summary—Other and Total
2021 Q2 vs.
Six Months Ended June 30,
2021
2021
2020
2020
2020
2021
2020
2021 vs.
(Dollars in millions)
Q2
Q1
Q4
Q3
Q2
Q1
Q2
2021
2020
2020
Other
Earnings:
Net interest income (loss)
$
(35)
$
(100)
$
(74)
$
(158)
$
(92)
(65)
%
(62)
%
$
(135)
$
83
**
Non-interest income (loss)
(23)
(119)
6
469
(26)
(81)
(12)
(142)
(77)
84
%
Total net revenue (loss)(8)
(58)
(219)
(68)
311
(118)
(74)
(51)
(277)
6
**
Provision (benefit) for credit losses
—
(2)
1
(2)
(1)
**
**
(2)
4
**
Non-interest expense(15)
163
69
132
110
340
136
(52)
232
458
(49)
Income (loss) from continuing operations before income taxes
(221)
(286)
(201)
203
(457)
(23)
(52)
(507)
(456)
11
Income tax provision (benefit)
(101)
(190)
(276)
316
(305)
(47)
(67)
(291)
(418)
(30)
Income (loss) from continuing operations, net of tax
$
(120)
$
(96)
$
75
$
(113)
$
(152)
25
(21)
$
(216)
$
(38)
**
Selected performance metrics:
Period-end deposits
$
12,180
$
14,775
$
16,037
$
19,258
$
21,765
(18)
(44)
$
12,180
$
21,765
(44)
Average deposits
13,418
15,450
16,418
20,820
21,416
(13)
(37)
14,428
19,379
(26)
Total
Earnings:
Net interest income
$
5,743
$
5,822
$
5,873
$
5,555
$
5,460
(1)
%
5
%
$
11,565
$
11,485
1
%
Non-interest income
1,631
1,291
1,464
1,826
1,096
26
49
2,922
2,320
26
Total net revenue
7,374
7,113
7,337
7,381
6,556
4
12
14,487
13,805
5
Provision (benefit) for credit losses
(1,160)
(823)
264
331
4,246
41
**
(1,983)
9,669
**
Non-interest expense
3,966
3,740
4,009
3,548
3,770
6
5
7,706
7,499
3
Income (loss) from continuing operations before income taxes
4,568
4,196
3,064
3,502
(1,460)
9
**
8,764
(3,363)
**
Income tax provision (benefit)
1,031
869
496
1,096
(543)
19
**
1,900
(1,106)
**
Income (loss) from continuing operations, net of tax
$
3,537
$
3,327
$
2,568
$
2,406
$
(917)
6
**
$
6,864
$
(2,257)
**
Selected performance metrics:
Period-end loans held for investment
$
249,597
$
243,131
$
251,624
$
248,223
$
251,512
3
(1)
$
249,597
$
251,512
(1)
Average loans held for investment
246,463
243,937
247,689
249,511
253,358
1
(3)
245,207
258,124
(5)
Period-end deposits
306,308
310,328
305,442
305,725
304,238
(1)
1
306,308
304,238
1
Average deposits
308,217
305,056
304,513
305,516
288,344
1
7
306,645
276,498
11
CAPITAL ONE FINANCIAL CORPORATION (COF)
Table 14: Notes to Loan, Allowance and Business Segment Disclosures (Tables 7—13)
(1)
We reclassified $2.1 billion in partnership loans to held for sale as of September 30, 2020.
(2)
We reclassified $2.6 billion in international partnership loans to held for sale as of June 30, 2021.
(3)
We reclassified $1.5 billion in commercial loans to held for sale as of June 30, 2021.
(4)
Metrics include the impact of COVID-19 customer assistance programs where applicable.
(5)
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.
(6)
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.
(7)
Represents foreign currency translation adjustments.
(8)
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.
(9)
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.
(10)
Total net revenue margin is calculated based on total net revenue for the period divided by average loans outstanding during the period.
(11)
Purchase volume consists of purchase transactions, net of returns, for the period, and excludes cash advance and balance transfer transactions.
(12)
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.
(13)
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.
(14)
Criticized exposures correspond to the "Special Mention," "Substandard" and "Doubtful" asset categories defined by bank regulatory authorities.
(15)
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)
June 30,
2021
March 31,
2021
December 31,
2020
September 30,
2020
June 30,
2020
Regulatory Capital Metrics
Common equity excluding AOCI
$
58,969
$
57,607
$
55,299
$
52,839
$
50,614
Adjustments:
AOCI, net of tax(2)
(5)
(13)
(29)
(122)
(145)
Goodwill, net of related deferred tax liabilities
(14,440)
(14,444)
(14,448)
(14,448)
(14,449)
Intangible assets, net of related deferred tax liabilities
(76)
(81)
(86)
(95)
(135)
Other
(16)
(18)
—
—
—
Common equity Tier 1 capital
$
44,432
$
43,051
$
40,736
$
38,174
$
35,885
Tier 1 capital
$
50,920
$
47,898
$
45,583
$
43,505
$
41,094
Total capital(3)
57,932
54,780
52,788
50,955
48,508
Risk-weighted assets
307,372
295,209
297,903
293,852
290,222
Adjusted average assets(4)
411,032
408,596
406,762
409,602
398,062
Capital Ratios
Common equity Tier 1 capital(5)
14.5
%
14.6
%
13.7
%
13.0
%
12.4
%
Tier 1 capital(6)
16.6
16.2
15.3
14.8
14.2
Total capital(7)
18.8
18.6
17.7
17.3
16.7
Tier 1 leverage(4)
12.4
11.7
11.2
10.6
10.3
Tangible common equity ("TCE")(8)
10.6
10.1
10.0
9.4
8.8
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. 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.
2021
2020
Six Months Ended June 30,
(Dollars in millions, except per share data and as noted)
Q2
Q1
Q2
Q1
2021
2020
Adjusted diluted EPS:
Net income (loss) available to common stockholders (GAAP)
$
3,446
$
3,236
$
(1,009)
$
(1,420)
$
6,682
$
(2,429)
Legal reserve activity, including insurance recoveries
55
—
265
45
55
310
Cybersecurity Incident expenses, net of insurance
—
—
11
4
—
15
Adjusted net income (loss) available to common stockholders before income tax impacts (non-GAAP)
3,501
3,236
(733)
(1,371)
6,737
(2,104)
Income tax impacts
(13)
—
(3)
(12)
(13)
(15)
Adjusted net income (loss) available to common stockholders (non-GAAP)
$
3,488
$
3,236
$
(736)
$
(1,383)
$
6,724
$
(2,119)
Diluted weighted-average common shares outstanding (in millions) (GAAP)
452.3
460.1
456.7
457.6
456.2
457.1
Diluted EPS (GAAP)
$
7.62
$
7.03
$
(2.21)
$
(3.10)
$
14.65
$
(5.31)
Impact of adjustments noted above
0.09
—
0.60
0.08
0.09
0.67
Adjusted diluted EPS (non-GAAP)
$
7.71
$
7.03
$
(1.61)
$
(3.02)
$
14.74
$
(4.64)
Adjusted efficiency ratio:
Non-interest expense (GAAP)
$
3,966
$
3,740
$
3,770
$
3,729
$
7,706
$
7,499
Legal reserve activity, including insurance recoveries
(55)
—
(265)
(45)
(55)
(310)
Cybersecurity Incident expenses, net of insurance
—
—
(11)
(4)
—
(15)
Adjusted non-interest expense (non-GAAP)
$
3,911
$
3,740
$
3,494
$
3,680
$
7,651
$
7,174
Total net revenue (GAAP)
$
7,374
$
7,113
$
6,556
$
7,249
$
14,487
$
13,805
Efficiency ratio (GAAP)
53.78
%
52.58
%
57.50
%
51.44
%
53.19
%
54.32
%
Impact of adjustments noted above
(74)
bps
—
bps
(421)
bps
(67)
bps
(38)
bps
(235)
bps
Adjusted efficiency ratio (non-GAAP)
53.04
%
52.58
%
53.29
%
50.77
%
52.81
%
51.97
%
Adjusted operating efficiency ratio:
Operating expense (GAAP)
$
3,346
$
3,239
$
3,497
$
3,238
$
6,585
$
6,735
Legal reserve activity, including insurance recoveries
(55)
—
(265)
(45)
(55)
(310)
Cybersecurity Incident expenses, net of insurance
—
—
(11)
(4)
—
(15)
Adjusted operating expense (non-GAAP)
$
3,291
$
3,239
$
3,221
$
3,189
$
6,530
$
6,410
Total net revenue (GAAP)
$
7,374
$
7,113
$
6,556
$
7,249
$
14,487
$
13,805
Operating efficiency ratio (GAAP)
45.38
%
45.54
%
53.34
%
44.67
%
45.45
%
48.79
%
Impact of adjustments noted above
(75)
bps
—
bps
(421)
bps
(68)
bps
(38)
bps
(236)
bps
Adjusted operating efficiency ratio (non-GAAP)
44.63
%
45.54
%
49.13
%
43.99
%
45.07
%
46.43
%
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.
2021
2021
2020
2020
2020
(Dollars in millions)
Q2
Q1
Q4
Q3
Q2
Tangible Common Equity (Period-End)
Stockholders' equity
$
64,624
$
61,188
$
60,204
$
58,424
$
56,045
Goodwill and intangible assets(9)
(14,774)
(14,789)
(14,809)
(14,825)
(14,869)
Noncumulative perpetual preferred stock
(6,488)
(4,847)
(4,847)
(5,330)
(5,209)
Tangible common equity
$
43,362
$
41,552
$
40,548
$
38,269
$
35,967
Tangible Common Equity (Average)
Stockholders' equity
$
62,376
$
60,623
$
59,389
$
57,223
$
57,623
Goodwill and intangible assets(9)
(14,788)
(14,807)
(14,824)
(14,867)
(14,880)
Noncumulative perpetual preferred stock
(5,491)
(4,847)
(5,168)
(5,228)
(5,209)
Tangible common equity
$
42,097
$
40,969
$
39,397
$
37,128
$
37,534
Tangible Assets (Period-End)
Total assets
$
423,420
$
425,175
$
421,602
$
421,883
$
421,296
Goodwill and intangible assets(9)
(14,774)
(14,789)
(14,809)
(14,825)
(14,869)
Tangible assets
$
408,646
$
410,386
$
406,793
$
407,058
$
406,427
Tangible Assets (Average)
Total assets
$
424,099
$
421,808
$
420,011
$
422,854
$
411,075
Goodwill and intangible assets(9)
(14,788)
(14,807)
(14,824)
(14,867)
(14,880)
Tangible assets
$
409,311
$
407,001
$
405,187
$
407,987
$
396,195
__________
(1)
Regulatory capital metrics and capital ratios as of June 30, 2021 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.