MCLEAN, Va., Jul 16, 2003 /PRNewswire-FirstCall via COMTEX/ -- Capital One Financial
Corporation (NYSE: COF) today announced that its second quarter of 2003
earnings per share increased by 34 percent over the same period in the prior
year. This increase in earnings was driven primarily by the improved
profitability of its auto and international businesses.
Earnings for the second quarter of 2003 were $286.8 million, or $1.23 per
share (fully diluted) compared with earnings of $213.1 million, or $0.92 per
share, for the second quarter of 2002. Earnings in the first quarter of 2003
were $309.1 million, or $1.35 per share.
The managed charge-off rate declined to 6.32 percent in the second quarter
of 2003, from 6.47 percent in the previous quarter. The managed delinquency
rate declined to 4.95 percent from 4.97 percent at the end of the previous
quarter.
"We continue to expect that we will report earnings per share of at least
$4.55 for 2003, as we increase our marketing and Allowance for Loan Losses to
support the more robust portfolio growth we expect in the second half," said
Richard D. Fairbank, Capital One's Chairman and Chief Executive Officer. "We
are pleased that charge-offs declined in the quarter, as predicted, to 6.32
percent and we expect additional improvement in the second half of the year."
The company continues to shift its portfolio mix to higher quality loans.
As a consequence, Capital One's managed revenue margin declined to 14.85
percent in the second quarter of 2003 from 15.70 percent in the previous
quarter. The managed risk-adjusted margin declined to 9.23 percent from 9.77
percent in the previous quarter. The company expects that the revenue margin
will drift lower as it continues to shift its mix to higher quality loans.
Capital One's managed loan balance increased by $1.5 billion to $60.7
billion at the end of the second quarter. Also, during the second quarter, as
part of its ongoing program of auto-loan sales, the company sold $1.3 billion
in auto loans, recording a gain of $35.0 million. The company expects to
continue to sell auto loans in the second half of the year, yet hold a higher
proportion of auto loan growth on its balance sheet. The company's accounts
declined by 638 thousand to 45.8 million at the end of the second quarter.
"We continue to expect managed loan growth of 15 to 20 percent in 2003,"
said David R. Lawson, Capital One's Chief Financial Officer. "Our diversified
efforts in auto finance and international will be an increasing contributor to
the earnings growth of Capital One this year."
Marketing expenses for the second quarter of 2003 increased $28.9 million
to $270.6 million from $241.7 million in the first quarter. Marketing
expenses were $320.4 million in the comparable period of the prior year.
Other non-interest expenses (excluding marketing) for the second quarter of
2003 were $880.0 million versus $931.2 million for the first quarter and
$833.2 million in the comparable period of the prior year. Annualized
operating cost per account decreased to $76.35 for the second quarter of 2003
from $79.43 in the prior quarter.
The company generates earnings from its managed loan portfolio which
includes both on-balance sheet loans and off-balance sheet loans. For this
reason the company believes the managed financial measures to be useful to
stakeholders. In compliance with Regulation G of the Securities and Exchange
Commission, the company is providing a numerical reconciliation of managed
financial measures to comparable measures calculated on a reported basis using
generally accepted accounting principles. Please see the schedule entitled
"Reconciliation to GAAP Financial Measures" attached to this release for more
information.
The company cautioned that its current expectations for 2003 earnings,
charge-off rates, margins, marketing expense, Allowance for Loan Losses, and
future loan growth are forward-looking statements and actual results could
differ materially from current expectations due to a number of factors,
including: competition in the credit card industry; the actual account and
balance growth achieved by the company; the company's ability to access the
capital markets at attractive rates and terms to fund its operations and
future growth; and general economic conditions affecting consumer income and
spending, which may affect consumer bankruptcies, defaults and charge-offs.
A discussion of these and other factors can be found in Capital One's
annual and other reports filed with the Securities and Exchange Commission,
including, but not limited to, Capital One's report on Form 10-Q for the
quarter ended March 31, 2003.
Headquartered in McLean, Virginia, Capital One Financial Corporation
(www.capitalone.com) is a holding company whose principal subsidiaries
include: Capital One Bank and Capital One, F.S.B., which offer consumer
lending products, and Capital One Auto Finance, Inc., which offers auto loan
products. Capital One's subsidiaries collectively had 45.8 million managed
accounts and $60.7 billion in managed loans outstanding as of June 30, 2003.
Capital One, a Fortune 500 company, is one of the largest providers of
MasterCard and Visa credit cards in the world. Capital One trades on the New
York Stock Exchange under the symbol "COF" and is included in the S&P 500
index.
CAPITAL ONE FINANCIAL CORPORATION (COF)
FINANCIAL & STATISTICAL SUMMARY REPORTED BASIS(5)
2003 2003
Q2 Q1
(in millions, except per share data
and as noted)
Earnings (Reported Basis)
Net Interest Income $ 682.3 $ 734.8
Non-Interest Income 1,310.6 1,304.6
Total Revenue(1) 1,992.9 2,039.4
Provision for Loan Losses 387.1 375.9
Marketing Expenses 270.6 241.7
Operating Expenses 880.0 931.2
Income Before Taxes 455.2 490.6
Tax Rate 37.0 % 37.0 %
Net Income $ 286.8 $ 309.1
Common Share Statistics
Basic EPS $ 1.28 $ 1.39
Diluted EPS $ 1.23 $ 1.35
Dividends Per Share $ 0.03 $ 0.03
Book Value Per Share (period end) $ 23.37 $ 21.78
Stock Price Per Share (period end) $ 49.18 $ 30.01
Total Market Capitalization (period end) $11,170.0 $ 6,791.8
Shares Outstanding (period end) 227.1 226.3
Shares Used to Compute Basic EPS 223.7 223.0
Shares Used to Compute Diluted EPS 232.6 228.4
Reported Balance Sheet Statistics
(period avg.)
Average Loans $ 27,101 $ 27,316
Average Earning Assets $ 36,298 $ 34,144
Average Assets $ 39,678 $ 38,318
Average Equity $ 5,148 $ 4,823
Net Interest Margin 7.52 % 8.61 %
Revenue Margin 21.96 % 23.89 %
Risk Adjusted Margin (2) 17.16 % 18.49 %
Return on Average Assets (ROA) 2.89 % 3.23 %
Return on Average Equity (ROE) 22.28 % 25.64 %
Net Charge-Off Rate 6.43 % 6.76 %
Net Charge-Offs $ 435.6 $ 461.5
Reported Balance Sheet Statistics
(period end)
Loans $ 26,849 $ 27,634
Delinquency Rate (30+ days) 5.61 % 5.39 %
Total Assets $ 40,367 $ 37,911
Allowance as a % of reported loans 5.92 % 5.92 %
Capital (4) $ 6,130.4 $ 5,749.0
Capital to Assets Ratio 15.19 % 15.16 %
Capital plus Allowance to Assets Ratio 19.24 % 19.48 %
(1) In accordance with the Company's finance charge and fee revenue
recognition policy, the amounts billed to customers but not recognized
as revenue were as follows: Q2 2003 - $497.3 million, Q1 2003 -
$519.7 million, Q4 2002 - $675.7 million, Q3 2002 - $489.6 million and
Q2 2002 - $574.4 million.
(2) Risk adjusted margin is total revenue less net charge-offs as a
percentage of average earning assets.
(3) Includes $110.0 million of one-time charges in Q3 2002.
(4) Includes preferred interests and mandatory convertible securities.
(5) Certain prior period amounts have been reclassified to conform to the
current period presentation related to the adoption of Financial
Accounting Standards Board Staff Position, "Accrued Interest
Receivable", that was issued in April 2003.
CAPITAL ONE FINANCIAL CORPORATION (COF)
FINANCIAL & STATISTICAL SUMMARY REPORTED BASIS(5)
2002 2002 2002
Q4 Q3 Q2
(in millions, except per share data
and as noted)
Earnings (Reported Basis)
Net Interest Income $ 731.0 $ 722.4 $ 654.4
Non-Interest Income 1,320.3 1,520.2 1,384.8
Total Revenue(1) 2,051.4 2,242.6 2,039.2
Provision for Loan Losses 543.8 674.1 541.8
Marketing Expenses 210.8 185.8 320.4
Operating Expenses 910.2 965.2(3) 833.2
Income Before Taxes 386.6 417.5 343.7
Tax Rate 38.0 % 38.0 % 38.0 %
Net Income $ 239.7 $ 258.8 $ 213.1
Common Share Statistics
Basic EPS $ 1.08 $ 1.17 $ 0.97
Diluted EPS $ 1.05 $ 1.13 $ 0.92
Dividends Per Share $ 0.03 $ 0.03 $ 0.03
Book Value Per Share (period end) $ 20.44 $ 19.55 $ 18.13
Stock Price Per Share (period end) $ 29.72 $ 34.92 $ 61.05
Total Market Capitalization (period
end) $ 6,722.5 $ 7,744.2 $13,512.9
Shares Outstanding (period end) 226.2 221.8 221.3
Shares Used to Compute Basic EPS 221.8 220.6 220.0
Shares Used to Compute Diluted EPS 228.2 228.4 231.7
Reported Balance Sheet Statistics
(period avg.)
Average Loans $ 27,260 $ 26,058 $ 24,876
Average Earning Assets $ 34,075 $ 32,449 $ 30,678
Average Assets $ 37,208 $ 35,470 $ 34,040
Average Equity $ 4,568 $ 4,418 $ 4,021
Net Interest Margin 8.58 % 8.91 % 8.53 %
Revenue Margin 24.08 % 27.64 % 26.59 %
Risk Adjusted Margin (2) 19.18 % 23.90 % 22.69 %
Return on Average Assets (ROA) 2.58 % 2.92 % 2.50 %
Return on Average Equity (ROE) 20.99 % 23.44 % 21.20 %
Net Charge-Off Rate 6.13 % 4.66 % 4.81 %
Net Charge-Offs $ 417.7 $ 303.9 $ 299.4
Reported Balance Sheet Statistics
(period end)
Loans $ 27,344 $ 27,598 $ 24,496
Delinquency Rate (30+ days) 6.12 % 5.71 % 4.51 %
Total Assets $ 37,382 $ 36,910 $ 33,834
Allowance as a % of reported loans 6.29 % 5.78 % 5.05 %
Capital (4) $ 5,440.4 $ 5,149.6 $ 4,823.6
Capital to Assets Ratio 14.55 % 13.95 % 14.26 %
Capital plus Allowance to Assets
Ratio 19.15 % 18.27 % 17.91 %
(1) In accordance with the Company's finance charge and fee revenue
recognition policy, the amounts billed to customers but not recognized
as revenue were as follows: Q2 2003 - $497.3 million, Q1 2003 -
$519.7 million, Q4 2002 - $675.7 million, Q3 2002 - $489.6 million and
Q2 2002 - $574.4 million.
(2) Risk adjusted margin is total revenue less net charge-offs as a
percentage of average earning assets.
(3) Includes $110.0 million of one-time charges in Q3 2002.
(4) Includes preferred interests and mandatory convertible securities.
(5) Certain prior period amounts have been reclassified to conform to the
current period presentation related to the adoption of Financial
Accounting Standards Board Staff Position, "Accrued Interest
Receivable", that was issued in April 2003.
CAPITAL ONE FINANCIAL CORPORATION (COF)
FINANCIAL & STATISTICAL SUPPLEMENT REPORTED BASIS(1)
2003 2003
Q2 Q1
(in millions, except per share data
and as noted)
Revenue & Expense Statistics (Reported)
Net interest income growth (annualized) (29)% 2 %
Non interest income growth (annualized) 2 % (5)%
Revenue growth (annualized) (9)% (2)%
Revenue margin (average loans) 29.41 % 29.86 %
Risk adjusted margin (average loans) 22.98 % 23.11 %
Ops cost as a % of revenues 44.16 % 45.66 %
Ops cost as a % of average loans
(annualized) 12.99 % 13.64 %
Per Account Statistics (Reported)
Net interest income per account
(annualized) $ 59.19 $ 62.68
Non interest income per account
(annualized) $ 113.71 $ 111.28
Revenue per account (annualized) $ 172.90 $ 173.95
Growth Statistics (Reported)
Net new loans $ (785) $ 290
% loan growth Q over Q (annualized) (11)% 4 %
% loan growth Y over Y 10 % 15 %
(1) Certain prior period amounts have been reclassified to conform to the
current period presentation related to the adoption of Financial
Accounting Standards Board Staff Position, "Accrued Interest
Receivable", that was issued in April 2003.
CAPITAL ONE FINANCIAL CORPORATION (COF)
FINANCIAL & STATISTICAL SUPPLEMENT REPORTED BASIS(1)
2002 2002 2002
Q4 Q3 Q2
(in millions, except per share data
and as noted)
Revenue & Expense Statistics
(Reported)
Net interest income growth
(annualized) 5 % 42 % 28 %
Non interest income growth
(annualized) (53)% 39 % 46 %
Revenue growth (annualized) (34)% 40 % 40 %
Revenue margin (average loans) 30.10 % 34.43 % 32.79 %
Risk adjusted margin (average loans) 23.97 % 29.76 % 27.98 %
Ops cost as a % of revenues 44.37 % 43.04 % 40.86 %
Ops cost as a % of average loans
(annualized) 13.36 % 14.82 % 13.40 %
Per Account Statistics (Reported)
Net interest income per account
(annualized) $ 61.22 $ 59.72 $ 54.97
Non interest income per account
(annualized) $ 110.57 $ 125.67 $ 116.33
Revenue per account (annualized) $ 171.78 $ 185.39 $ 171.30
Growth Statistics (Reported)
Net new loans $ (254) $ 3,102 $ 532
% loan growth Q over Q (annualized) (4)% 51 % 9 %
% loan growth Y over Y 31 % 58 % 50 %
(1) Certain prior period amounts have been reclassified to conform to the
current period presentation related to the adoption of Financial
Accounting Standards Board Staff Position, "Accrued Interest
Receivable", that was issued in April 2003.
CAPITAL ONE FINANCIAL CORPORATION (COF)
FINANCIAL & STATISTICAL SUMMARY MANAGED BASIS(4)
2003 2003
Q2 Q1
(in millions, except per share data
and as noted)
Earnings (Managed Basis)
Net Interest Income $ 1,457.5 $ 1,508.0
Non-Interest Income 1,046.0 1,027.9
Total Revenue(1) 2,503.5 2,535.9
Provision for Loan Losses 897.7 872.3
Marketing Expenses 270.6 241.7
Operating Expenses 880.0 931.2
Income Before Taxes 455.2 490.6
Tax Rate 37.0 % 37.0 %
Net Income $ 286.8 $ 309.1
Managed Balance Sheet Statistics
(period avg.)
Average Loans $ 59,916 $ 59,250
Average Earning Assets $ 67,451 $ 64,602
Average Assets $ 71,913 $ 69,670
Net Interest Margin 8.64 % 9.34 %
Revenue Margin 14.85 % 15.70 %
Risk Adjusted Margin (2) 9.23 % 9.77 %
Return on Average Assets (ROA) 1.60 % 1.77 %
Net Charge-Off Rate 6.32 % 6.47 %
Net Charge-Offs $ 946.3 $ 957.9
Cost Per Account (in dollars) $ 76.35 $ 79.43
Managed Balance Sheet Statistics
(period end)
Loans $ 60,736 $ 59,214
Delinquency Rate (30+ days) 4.95 % 4.97 %
plus Allowance to Assets Ratio 10.48 % 10.71 %
(1) In accordance with the Company's finance charge and fee revenue
recognition policy, the amounts billed to customers but not recognized
as revenue were as follows: Q2 2003 - $497.3 million, Q1 2003 -
$519.7 million, Q4 2002 - $675.7 million, Q3 2002 - $489.6 million and
Q2 2002 - $574.4 million.
(2) Risk adjusted margin is total revenue less net charge-offs as a
percentage of average earning assets.
(3) Includes $110.0 million of one-time charges in Q3 2002.
(4) The information in this statistical summary reflects the adjustment to
add back the effect of securitized loans. See accompanying schedule -
"Reconciliation to GAAP Financial Measures".
CAPITAL ONE FINANCIAL CORPORATION (COF)
FINANCIAL & STATISTICAL SUMMARY MANAGED BASIS(4)
2002 2002 2002
Q4 Q3 Q2
(in millions, except per share data
and as noted)
Earnings (Managed Basis)
Net Interest Income $ 1,442.2 $ 1,435.3 $ 1,234.3
Non-Interest Income 1,086.9 1,189.1 1,145.0
Total Revenue(1) 2,529.1 2,624.4 2,379.3
Provision for Loan Losses 1,021.5 1,055.9 881.9
Marketing Expenses 210.8 185.8 320.4
Operating Expenses 910.2 965.2(3) 833.2
Income Before Taxes 386.6 417.5 343.7
Tax Rate 38.0 % 38.0 % 38.0 %
Net Income $ 239.7 $ 258.8 $ 213.1
Managed Balance Sheet Statistics
(period avg.)
Average Loans $ 57,669 $ 55,350 $ 51,343
Average Earning Assets $ 62,789 $ 60,016 $ 55,559
Average Assets $ 67,037 $ 64,193 $ 59,989
Net Interest Margin 9.19 % 9.57 % 8.89 %
Revenue Margin 16.11 % 17.49 % 17.13 %
Risk Adjusted Margin (2) 10.41 % 12.92 % 12.53 %
Return on Average Assets (ROA) 1.43 % 1.61 % 1.42 %
Net Charge-Off Rate 6.21 % 4.96 % 4.98 %
Net Charge-Offs $ 895.5 $ 685.7 $ 639.4
Cost Per Account (in dollars) $ 76.22 $ 79.79 $ 69.99
Managed Balance Sheet Statistics
(period end)
Loans $ 59,747 $ 56,883 $ 53,208
Delinquency Rate (30+ days) 5.60 % 5.31 % 4.43 %
Number of Accounts (000's) 47,369 48,163 48,612
Total Assets $ 69,205 $ 65,614 $ 62,022
Capital to Assets Ratio 7.86 % 7.85 % 7.78 %
Capital plus Allowance to Assets
Ratio 10.35 % 10.28 % 9.77 %
(1) In accordance with the Company's finance charge and fee revenue
recognition policy, the amounts billed to customers but not recognized
as revenue were as follows: Q2 2003 - $497.3 million, Q1 2003 -
$519.7 million, Q4 2002 - $675.7 million, Q3 2002 - $489.6 million and
Q2 2002 - $574.4 million.
(2) Risk adjusted margin is total revenue less net charge-offs as a
percentage of average earning assets.
(3) Includes $110.0 million of one-time charges in Q3 2002.
(4) The information in this statistical summary reflects the adjustment to
add back the effect of securitized loans. See accompanying schedule -
"Reconciliation to GAAP Financial Measures".
CAPITAL ONE FINANCIAL CORPORATION (COF)
FINANCIAL & STATISTICAL SUPPLEMENT MANAGED BASIS(1)
2003 2003
Q2 Q1
(in millions, except per share data
and as noted)
Revenue & Expense Statistics (Managed)
Net interest income growth (annualized) (13)% 18 %
Non interest income growth (annualized) 7 % (22)%
Revenue growth (annualized) (5)% 1 %
Revenue margin (average loans) 16.71 % 17.12 %
Risk adjusted margin (average loans) 10.40 % 10.65 %
Ops cost as a % of revenues 35.15 % 36.72 %
Ops cost as a % of average loans
(annualized) 5.87 % 6.29 %
Per Account Statistics (Managed)
Net interest income per account
(annualized) $ 126.45 $ 128.62
Non interest income per account
(annualized) $ 90.75 $ 87.68
Revenue per account (annualized) $ 217.21 $ 216.30
Net income per account (annualized) $ 24.88 $ 26.37
Growth Statistics (Managed)
Average accounts (000's) 46,104 46,896
Net new accounts per quarter (000's) (638) (946)
% account growth Q over Q (annualized) (5)% (8)%
% account growth Y over Y (6)% - %
Net new loans $ 1,522 $ (533)
% loan growth Q over Q (annualized) 10 % (4)%
% loan growth Y over Y 14 % 22 %
Balance Sheet Measures
% off-balance sheet securitizations 55 % 53 %
% at introductory rate 10 % 9 %
Segment Statistics
Consumer Lending:
Loans receivable $ 47,182 $ 45,963
Net income (loss) $ 289.8 $ 309.2
Net charge-off rate 6.95 % 7.12 %
Delinquency rate 4.83 % 4.99 %
Auto Finance:
Loans receivable $ 7,380 $ 7,742
Net income (loss) $ 44.0 $ (6.5)
Net charge-off rate 4.22 % 4.91 %
Delinquency rate 6.97 % 5.37 %
International:
Loans receivable $ 6,061 $ 5,390
Net income (loss) $ 13.6 $ 18.1
Net charge-off rate 4.48 % 4.28 %
Delinquency rate 3.92 % 4.22 %
(1) The information in this statistical summary supplement reflects the
adjustment to add back the effect of securitized loans. See
accompanying schedule -- "Reconciliation to GAAP Financial Measures".
CAPITAL ONE FINANCIAL CORPORATION (COF)
FINANCIAL & STATISTICAL SUPPLEMENT MANAGED BASIS(1)
2002 2002 2002
Q4 Q3 Q2
(in millions, except per share data
and as noted)
Revenue & Expense Statistics
(Managed)
Net interest income growth
(annualized) 2 % 65 % 21 %
Non interest income growth
(annualized) (34)% 15 % 63 %
Revenue growth (annualized) (15)% 41 % 40 %
Revenue margin (average loans) 17.54 % 18.97 % 18.54 %
Risk adjusted margin (average loans) 11.33 % 14.01 % 13.55 %
Ops cost as a % of revenues 35.99 % 36.78 % 35.02 %
Ops cost as a % of average loans
(annualized) 6.31 % 6.98 % 6.49 %
Per Account Statistics (Managed)
Net interest income per account
(annualized) $ 120.77 $ 118.65 $ 103.69
Non interest income per account
(annualized) $ 91.02 $ 98.30 $ 96.18
Revenue per account (annualized) $ 211.79 $ 216.95 $ 199.87
Net income per account (annualized) $ 20.07 $ 21.39 $ 17.90
Growth Statistics (Managed)
Average accounts (000's) 47,766 48,388 47,618
Net new accounts per quarter (000's) (794) (449) 1,989
% account growth Q over Q
(annualized) (7)% (4)% 17 %
% account growth Y over Y 8 % 20 % 27 %
Net new loans $ 2,864 $ 3,675 $ 4,644
% loan growth Q over Q (annualized) 20 % 28 % 38 %
% loan growth Y over Y 32 % 48 % 51 %
Balance Sheet Measures
% off-balance sheet securitizations 53 % 51 % 53 %
% at introductory rate 10 % 11 % 12 %
Segment Statistics
Consumer Lending:
Loans receivable $ 47,290 $ 45,021 $ 42,819
Net income (loss) $ 183.1 $ 291.3 $ 296.6
Net charge-off rate 6.45 % 5.16 % 5.46 %
Delinquency rate 5.54 % 5.41 % 4.51 %
Auto Finance:
Loans receivable $ 6,992 $ 6,496 $ 5,354
Net income (loss) $ 8.8 $ (3.4) $ 14.9
Net charge-off rate 4.83 % 3.97 % 2.84 %
Delinquency rate 7.15 % 6.30 % 5.38 %
International:
Loans receivable $ 5,331 $ 5,255 $ 4,985
Net income (loss) $ (6.2) $ (1.1) $ (19.8)
Net charge-off rate 3.92 % 3.61 % 3.91 %
Delinquency rate 4.18 % 3.78 % 3.78 %
(1) The information in this statistical summary supplement reflects the
adjustment to add back the effect of securitized loans. See
accompanying schedule -- "Reconciliation to GAAP Financial Measures".
CAPITAL ONE FINANCIAL CORPORATION
Reconciliation to GAAP Financial Measures
For the Three Months Ended June 30, 2003
(dollars in thousands)(unaudited)
The Company's consolidated financial statements prepared in accordance
with generally accepted accounting principles ("GAAP") are referred to as its
"reported" financial statements. Loans included in securitization
transactions which qualified as sales under GAAP have been removed from the
Company's "reported" balance sheet. However, interest income, interchange,
fees and recoveries generated from the securitized loan portfolio net of
charge-offs in excess of the interest paid to investors of asset-backed
securitizations are recognized as non-interest income on the "reported" income
statement.
The Company's "managed" consolidated financial statements add back the
effects of securitization transactions qualifying as sales under GAAP. The
Company generates earnings from its "managed" loan portfolio which includes
both the on-balance sheet loans and off-balance sheet loans. The Company's
"managed" income statement takes the components of the non-interest income
generated from the securitized portfolio and distributes the revenue to
appropriate income statement line items from which it originated. For this
reason the Company believes the "managed" consolidated financial statements
and related managed metrics to be useful to stakeholders.
Total Total
Reported Adjustments(1) Managed(2)
Income Statement Measures
Net interest income $ 682,263 $ 775,254 $ 1,457,517
Non-interest income $ 1,310,622 $ (264,610)$ 1,046,012
Total revenue $ 1,992,885 $ 510,644 $ 2,503,529
Provision for loan losses $ 387,097 $ 510,644 $897,741
Balance Sheet Measures
Consumer loans $ 26,848,578 $ 33,887,231 $ 60,735,809
Total assets $ 40,366,651 $ 33,269,431 $ 73,636,082
Average consumer loans $ 27,101,042 $ 32,814,755 $ 59,915,797
Average earning assets $ 36,297,922 $ 31,152,917 $ 67,450,839
Average total assets $ 39,678,236 $ 32,235,014 $ 71,913,250
Delinquencies $ 1,506,812 $ 1,497,314 $ 3,004,126
(1) Includes adjustments made related to the effects of securitization
transactions qualifying as sales under GAAP and adjustments made to
reclassify to "managed" loans outstanding the collectible portion of
billed finance charge and fee income on the investors' interest in
securitized loans excluded from loans outstanding on the "reported"
balance sheet in accordance with Financial Accounting Standards Board
Staff Position, "Accrued Interest Receivable", issued April 2003.
(2) The Managed loan portfolio does not include auto loans which have been
sold in whole loan sale transactions where the company has retained
servicing rights.
CAPITAL ONE FINANCIAL CORPORATION
Consolidated Balance Sheets(1)
(in thousands)(unaudited)
June 30 March 31 June 30
2003 2003 2002
Assets:
Cash and due from banks $ 296,551 $ 328,791 $ 244,857
Federal funds sold and resale
agreements 2,320,658 864,036 432,124
Interest-bearing deposits at other
banks 578,479 247,560 448,363
Cash and cash equivalents 3,195,688 1,440,387 1,125,344
Securities available for sale 5,418,817 4,817,322 4,538,223
Consumer loans 26,848,578 27,634,440 24,496,006
Less: Allowance for loan losses (1,590,000) (1,635,000) (1,237,000)
Net loans 25,258,578 25,999,440 23,259,006
Accounts receivable from
securitizations 4,092,961 3,378,593 2,886,979
Premises and equipment, net 760,376 769,112 808,972
Interest receivable 200,517 208,998 151,828
Other 1,439,714 1,297,115 1,064,127
Total assets $ 40,366,651 $ 37,910,967 $ 33,834,479
Liabilities:
Interest-bearing deposits $ 19,821,881 $ 18,489,388 $ 16,014,392
Senior notes 5,987,125 5,116,591 6,069,719
Other borrowings 6,237,419 6,576,876 4,590,716
Interest payable 230,836 194,629 235,108
Other 2,782,400 2,604,818 2,910,638
Total liabilities 35,059,661 32,982,302 29,820,573
Stockholders' Equity:
Common stock 2,284 2,275 2,222
Paid-in capital, net 1,762,469 1,730,883 1,600,489
Retained earnings and cumulative
other comprehensive income 3,591,403 3,244,673 2,446,147
Less: Treasury stock, at cost (49,166) (49,166) (34,952)
Total stockholders' equity 5,306,990 4,928,665 4,013,906
Total liabilities and
stockholders' equity $ 40,366,651 $ 37,910,967 $ 33,834,479
(1) Certain prior period amounts have been reclassified to conform to the
current period presentation for the Financial Accounting Standards
Board Staff Position, "Accrued Interest Receivable", that was issued
in April 2003.
CAPITAL ONE FINANCIAL CORPORATION
Consolidated Statements of Income(1)
(in thousands, except per share data)(unaudited)
Three Months Ended
June 30 March 31 June 30
2003 2003 2002
Interest Income:
Consumer loans, including past-due
fees $ 960,124 $1,013,282 $ 930,751
Securities available for sale 47,895 42,931 45,815
Other 62,261 50,353 48,095
Total interest income 1,070,280 1,106,566 1,024,661
Interest Expense:
Deposits 220,640 209,308 203,112
Senior notes 106,151 104,097 109,687
Other borrowings 61,226 58,357 57,450
Total interest expense 388,017 371,762 370,249
Net interest income 682,263 734,804 654,412
Provision for loan losses 387,097 375,851 541,841
Net interest income after provision
for loan losses 295,166 358,953 112,571
Non-Interest Income:
Servicing and securitizations 742,696 729,689 718,347
Service charges and other customer-
related fees 402,970 441,226 460,984
Interchange 89,141 85,351 137,353
Other 75,815 48,337 68,128
Total non-interest income 1,310,622 1,304,603 1,384,812
Non-Interest Expense:
Salaries and associate benefits 373,257 397,449 379,363
Marketing 270,555 241,696 320,446
Communications and data processing 112,456 112,052 101,601
Supplies and equipment 87,680 83,812 88,844
Occupancy 42,755 43,574 38,275
Other 263,865 294,331 225,117
Total non-interest expense 1,150,568 1,172,914 1,153,646
Income before income taxes 455,220 490,642 343,737
Income taxes 168,431 181,538 130,620
Net income $ 286,789 $ 309,104 $ 213,117
Basic earnings per share $ 1.28 $ 1.39 $ 0.97
Diluted earnings per share $ 1.23 $ 1.35 $ 0.92
Dividends paid per share $ 0.03 $ 0.03 $ 0.03
(1) Certain prior period amounts have been reclassified to conform to the
current period presentation for the Financial Accounting Standards
Board Staff Position, "Accrued Interest Receivable", that was issued
in April 2003.
CAPITAL ONE FINANCIAL CORPORATION
Consolidated Statements of Income(1)
(in thousands, except per share data)(unaudited)
Six Months Ended
June 30 June 30
2003 2002
Interest Income:
Consumer loans, including past-due fees $1,973,406 $1,775,291
Securities available for sale 90,826 88,159
Other 112,614 95,572
Total interest income 2,176,846 1,959,022
Interest Expense:
Deposits 429,948 381,275
Senior notes 210,248 203,591
Other borrowings 119,583 108,506
Total interest expense 759,779 693,372
Net interest income 1,417,067 1,265,650
Provision for loan losses 762,948 931,458
Net interest income after provision
for loan losses 654,119 334,192
Non-Interest Income:
Servicing and securitizations 1,472,385 1,344,494
Service charges and other customer-
related fees 844,196 926,618
Interchange 174,492 235,449
Other 124,152 119,775
Total non-interest income 2,615,225 2,626,336
Non-Interest Expense:
Salaries and associate benefits 770,706 760,098
Marketing 512,251 673,982
Communications and data processing 224,508 193,794
Supplies and equipment 171,492 173,351
Occupancy 86,329 71,656
Other 558,196 440,660
Total non-interest expense 2,323,482 2,313,541
Income before income taxes 945,862 646,987
Income taxes 349,969 245,855
Net income $ 595,893 $ 401,132
Basic earnings per share $ 2.67 $ 1.83
Diluted earnings per share $ 2.58 $ 1.75
Dividends paid per share $ 0.05 $ 0.05
(1) Certain prior period amounts have been reclassified to conform to the
current period presentation for the Financial Accounting Standards
Board Staff Position, "Accrued Interest Receivable", that was issued
in April 2003.
CAPITAL ONE FINANCIAL CORPORATION
Statements of Average Balances, Income and Expense, Yields and Rates(1)
(dollars in thousands)(unaudited)
Reported Quarter Ended 6/30/03
Average Income/ Yield/
Balance Expense Rate
Earning assets:
Consumer loans $ 27,101,042 $ 960,124 14.17%
Securities available for sale 5,386,070 47,895 3.56%
Other 3,810,810 62,261 6.54%
Total earning assets $ 36,297,922 $ 1,070,280 11.79%
Interest-bearing liabilities:
Deposits $ 19,178,154 220,640 4.60%
Senior notes 5,533,693 106,151 7.67%
Other borrowings 6,682,797 61,226 3.66%
Total interest-bearing liabilities $ 31,394,644 $ 388,017 4.94%
Net interest spread 6.85%
Interest income to average earning
assets 11.79%
Interest expense to average earning
assets 4.27%
Net interest margin 7.52%
(1) Certain prior period amounts have been reclassified to conform to the
current period presentation for the Financial Accounting Standards
Board Staff Position, "Accrued Interest Receivable", that was issued
in April 2003.
CAPITAL ONE FINANCIAL CORPORATION
Statements of Average Balances, Income and Expense, Yields and Rates(1)
(dollars in thousands)(unaudited)
Reported Quarter Ended 3/31/03
Average Income/ Yield/
Balance Expense Rate
Earning assets:
Consumer loans $ 27,316,194 $ 1,013,282 14.84%
Securities available for sale 4,417,538 42,931 3.89%
Other 2,410,750 50,353 8.35%
Total earning assets $ 34,144,482 $ 1,106,566 12.96%
Interest-bearing liabilities:
Deposits $ 17,940,058 $209,308 4.67%
Senior notes 5,309,690 104,097 7.84%
Other borrowings 7,009,915 58,357 3.33%
Total interest-bearing liabilities $ 30,259,663 $ 371,762 4.91%
Net interest spread 8.05%
Interest income to average earning
assets 12.96%
Interest expense to average earning
assets 4.35%
Net interest margin 8.61%
(1) Certain prior period amounts have been reclassified to conform to the
current period presentation for the Financial Accounting Standards
Board Staff Position, "Accrued Interest Receivable", that was issued
in April 2003.
CAPITAL ONE FINANCIAL CORPORATION
Statements of Average Balances, Income and Expense, Yields and Rates(1)
(dollars in thousands)(unaudited)
Reported Quarter Ended 6/30/02
Average Income/ Yield/
Balance Expense Rate
Earning assets:
Consumer loans $ 24,876,120 $ 930,751 14.97%
Securities available for sale 3,662,832 45,815 5.00%
Other 2,138,553 48,095 9.00%
Total earning assets $ 30,677,505 $ 1,024,661 13.36%
Interest-bearing liabilities:
Deposits $ 15,276,514 $ 203,112 5.32%
Senior notes 5,959,240 109,687 7.36%
Other borrowings 5,946,983 57,450 3.86%
Total interest-bearing liabilities $ 27,182,737 $ 370,249 5.45%
Net interest spread 7.91%
Interest income to average earning
assets 13.36%
Interest expense to average earning
assets 4.83%
Net interest margin 8.53%
(1) Certain prior period amounts have been reclassified to conform to the
current period presentation for the Financial Accounting Standards
Board Staff Position, "Accrued Interest Receivable", that was issued
in April 2003.
CAPITAL ONE FINANCIAL CORPORATION
Statements of Average Balances, Income and Expense, Yields and Rates
(dollars in thousands)(unaudited)
Managed (1) Quarter Ended 6/30/03
Average Income/ Yield/
Balance Expense Rate
Earning assets:
Consumer loans $ 59,915,797 $ 2,110,859 14.09%
Securities available for sale 5,386,070 47,895 3.56%
Other 2,148,972 12,802 2.38%
Total earning assets $ 67,450,839 $ 2,171,556 12.88%
Interest-bearing liabilities:
Deposits $ 19,178,154 $ 220,640 4.60%
Senior notes 5,533,693 106,151 7.67%
Other borrowings 6,682,797 61,226 3.66%
Securitization liability 32,249,105 326,022 4.04%
Total interest-bearing liabilities $ 63,643,749 $ 714,039 4.49%
Net interest spread 8.39%
Interest income to average earning
assets 12.88%
Interest expense to average earning
assets 4.24%
Net interest margin 8.64%
(1) The information in this table reflects the adjustment to add back the
effect of securitized loans.
CAPITAL ONE FINANCIAL CORPORATION
Statements of Average Balances, Income and Expense, Yields and Rates
(dollars in thousands)(unaudited)
Managed (1) Quarter Ended 3/31/03
Average Income/ Yield/
Balance Expense Rate
Earning assets:
Consumer loans $ 59,249,698 $ 2,148,419 14.50%
Securities available for sale 4,417,538 42,931 3.89%
Other 934,382 5,323 2.28%
Total earning assets $ 64,601,618 $ 2,196,673 13.60%
Interest-bearing liabilities:
Deposits $ 17,940,058 $ 209,308 4.67%
Senior notes 5,309,690 104,097 7.84%
Other borrowings 7,009,915 58,357 3.33%
Securitization liability 31,361,051 316,960 4.04%
Total interest-bearing liabilities $ 61,620,714 $ 688,722 4.47%
Net interest spread 9.13%
Interest income to average earning
assets 13.60%
Interest expense to average earning
assets 4.26%
Net interest margin 9.34%
(1) The information in this table reflects the adjustment to add back the
effect of securitized loans.
CAPITAL ONE FINANCIAL CORPORATION
Statements of Average Balances, Income and Expense, Yields and Rates
(dollars in thousands)(unaudited)
Managed (1) Quarter Ended 6/30/02
Average Income/ Yield/
Balance Expense Rate
Earning assets:
Consumer loans $ 51,342,764 $ 1,838,672 14.32%
Securities available for sale 3,662,832 45,815 5.00%
Other 553,595 2,110 1.52%
Total earning assets $ 55,559,191 $ 1,886,597 13.58%
Interest-bearing liabilities:
Deposits $ 15,276,514 $ 203,112 5.32%
Senior notes 5,959,240 109,687 7.36%
Other borrowings 5,946,983 57,450 3.86%
Securitization liability 25,965,894 282,041 4.34%
Total interest-bearing liabilities $ 53,148,631 $ 652,290 4.91%
Net interest spread 8.67%
Interest income to average earning
assets 13.58%
Interest expense to average earning
assets 4.69%
Net interest margin 8.89%
(1) The information in this table reflects the adjustment to add back the
effect of securitized loans.
SOURCE Capital One Financial Corporation
Paul Paquin, V.P., Investor Relations, +1-703-720-2456, or
Tatiana Stead, Director, Corporate Media, +1-703-720-2352, both of Capital One
Financial Corporation
