Capital One Financial Corp. Files 2023 Annual Report on Form 10-K

TL;DR

<b>Capital One Financial Corp. has submitted its comprehensive 2023 annual report (10-K) detailing its financial performance and operations for the fiscal year ending December 31, 2023.</b>

AI Summary

CAPITAL ONE FINANCIAL CORP (COF-PN) filed a Annual Report (10-K) with the SEC on February 23, 2024. Capital One Financial Corp. filed its annual report on Form 10-K for the fiscal year ending December 31, 2023. The filing covers the period from January 1, 2023, to December 31, 2023. The company's principal executive offices are located at 1680 Capital One Drive, Suite 1400, McLean, VA 22102. Capital One Financial Corp. is classified under SIC code 6021 for National Commercial Banks. The filing includes detailed financial information and disclosures for the fiscal year 2023.

Why It Matters

For investors and stakeholders tracking CAPITAL ONE FINANCIAL CORP, this filing contains several important signals. This 10-K filing provides investors and analysts with a detailed overview of Capital One's financial health, strategic initiatives, and risk factors for the past fiscal year, enabling informed investment decisions. The report's disclosures are crucial for understanding the company's performance in the national commercial banking sector and its compliance with regulatory requirements.

Risk Assessment

Risk Level: medium — CAPITAL ONE FINANCIAL CORP shows moderate risk based on this filing. The filing is a standard annual report (10-K), which inherently contains detailed financial and operational information. However, the absence of specific financial performance highlights or significant strategic shifts within the provided header data suggests a need for deeper analysis of the full document to assess potential risks or opportunities.

Analyst Insight

Review the full 10-K filing for detailed financial statements, management's discussion and analysis, and risk factors to assess Capital One's performance and outlook.

Key Numbers

• 2023-12-31 — Fiscal Year End (Conformed Period of Report)
• 2024-02-23 — Filing Date (Date the 10-K was filed)
• 2023-01-01 — Reporting Period Start Date (Beginning of the fiscal year)
• 2022-12-31 — Prior Year End (Comparison point for financial data)

Key Players & Entities

• Capital One Financial Corp. (company) — Filer name and subject of the report
• 1680 Capital One Drive, Suite 1400, McLean, VA 22102 (company) — Business address
• 0000927628 (company) — Central Index Key (CIK) for Capital One Financial Corp.
• 6021 (company) — Standard Industrial Classification (SIC) code for National Commercial Banks
• 19940728 (company) — Date of name change from Oakstone Financial Corp.

FAQ

Industry Context

Capital One Financial Corp. operates within the national commercial banking industry, a sector characterized by significant regulatory oversight and competitive dynamics.

Regulatory Implications

As a financial institution, Capital One is subject to extensive regulation by federal and state authorities, including the Federal Reserve and state banking departments, impacting its operations and capital requirements.

What Investors Should Do

1. Analyze the detailed financial statements within the 10-K to understand revenue streams, expenses, and profitability for FY2023.
2. Examine the Management's Discussion and Analysis (MD&A) section for insights into the company's strategy, performance drivers, and outlook.
3. Review the Risk Factors section to identify potential challenges and their impact on Capital One's business.

Key Dates

• 2024-02-23: 10-K Filing — Submission of the annual report for fiscal year 2023
• 2023-12-31: Fiscal Year End — End date for the reporting period covered by the 10-K

Year-Over-Year Comparison

This filing represents the annual 10-K for the fiscal year 2023, following previous filings such as quarterly reports (10-Q) and potentially prior annual reports.

Key Financial Figures

• $250,000 b — 30 Amount of Time Deposits in Excess of $250,000 by Contractual Maturity 103 31 Long-Te
• $20 million — companies with annual revenues between $20 million and $2 billion. Customer usage and pay
• $2 billion — annual revenues between $20 million and $2 billion. Customer usage and payment patterns,
• $250 billion — h total consolidated assets of at least $250 billion but less than $700 billion and not exce
• $700 billion — of at least $250 billion but less than $700 billion and not exceeding any of the applicable

Filing Documents

• cof-20231231.htm (10-K) — 8059KB
• cof-12312023x10kxex43.htm (EX-4.3) — 185KB
• cof-12312023x10kxex1026.htm (EX-10.2 6) — 75KB
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• cof-12312023x10kxex10215.htm (EX-10.2 15) — 71KB
• cof-12312023x10kxex10217.htm (EX-10.2 17) — 79KB
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• cof-12312023x10kxex10220.htm (EX-10.2 20) — 82KB
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• cof-12312023x10kxex10227.htm (EX-10.2 27) — 72KB
• cof-12312023x10kxex10228.htm (EX-10.2 28) — 83KB
• cof-12312023x10kxex105.htm (EX-10.5) — 72KB
• cof-12312023x10kxex21.htm (EX-21) — 4KB
• cof-12312023x10kxex23.htm (EX-23) — 50KB
• cof-12312023x10kxex311.htm (EX-31.1) — 11KB
• cof-12312023x10kxex312.htm (EX-31.2) — 11KB
• cof-12312023x10kxex321.htm (EX-32.1) — 6KB
• cof-12312023x10kxex322.htm (EX-32.2) — 6KB
• cof-12312023x10kxex97.htm (EX-97) — 47KB
• cof-20231231_g1.jpg (GRAPHIC) — 142KB
• 0000927628-24-000094.txt (&nbsp;) — 37191KB
• cof-20231231.xsd (EX-101.SCH) — 135KB
• cof-20231231_cal.xml (EX-101.CAL) — 218KB
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Business

Business 4 Overview 4 Operations and Business Segments 6 Competition 7 Supervision and Regulation 7 Human Capital Resources 18 Technology and Intellectual Property 19

Forward-Looking Statements

Forward-Looking Statements 20 Item 1A.

Risk Factors

Risk Factors 22 Item 1B. Unresolved Staff Comments 43 I tem 1C. C ybersecurity 43 Item 2.

Properties

Properties 45 Item 3.

Legal Proceedings

Legal Proceedings 45 Item 4. Mine Safety Disclosures 45 PART II 46 Item 5. Market for Registrant's Common Equity, Related Stockholder Matters and Issuer Purchases of Equity Securities 46 Item 6. [Reserved] 49 Item 7 .

Management's Discussion and Analysis of Financial Condition and Results of Operations ("MD&A")

Management's Discussion and Analysis of Financial Condition and Results of Operations ("MD&A") 49

Selected Financial Data

Selected Financial Data 50 Executive Summary 53 Consolidated Results of Operations 54 Consolidated Balance Sheets Analysis 59 Off-Balance Sheet Arrangements 61 Business Segment Financial Performance 62 Critical Accounting Policies and Estimates 72 Accounting Changes and Developments 77 Capital Management 78 Risk Management 83 Credit Risk Profile 89 Liquidity Risk Profile 100 Market Risk Profile 105 Supplemental Table s 110 Glossary and Acronyms 112 Item 7A.

Quantitative and Qualitative Disclosures about Market Risk

Quantitative and Qualitative Disclosures about Market Risk 120 Item 8.

Financial Statements and Supplementary Data

Financial Statements and Supplementary Data 121 Consolidated Statements of Income 127 Consolidated Statements of Comprehensive Income 128 Consolidated Balance Sheets 129 1 Capital One Financial Corporation (COF) Consolidated Statements of Changes in Stockholders' Equity 130 Consolidated Statements of Cash Flows 131

Notes to Consolidated Financial Statements

Notes to Consolidated Financial Statements 133 Note 1—Summary of Significant Accounting Policies 133 Note 2—Investment Securities 148 Note 3—Loans 151 Note 4—Allowance for Credit Losses and Reserve for Unfunded Lending Commitments 164 Note 5—Variable Interest Entities and Securitizations 168 Note 6—Goodwill and Other Intangible Assets 172 Note 7—Premises, Equipment and Leases 175 Note 8—Deposits and Borrowings 177 Note 9—Derivative Instruments and Hedging Activities 179 Note 10—Stockholders' Equity 188 Note 11—Regulatory and Capital Adequacy 191 Note 12—Earnings Per Common Share 193 Note 13—Stock-Based Compensation Plans 194 Note 14—Employee Benefit Plans 196 Note 15—Income Taxes 198 Note 16—Fair Value Measurement 202 Note 17—Business Segments and Revenue from Contracts with Customers 211 Note 18—Commitments, Contingencies, Guarantees and Others 216 Note 19—Capital One Financial Corporation (Parent Company Only) 220 Note 20—Related Party Transactions 222 Note 21—Subsequent Events 222 Item 9. Changes in and Disagreements with Accountants on Accounting and Financial Disclosure 223 Item 9A.

Controls and Procedures

Controls and Procedures 223 Item 9B. Other Information 223 Item 9C. Disclosure Regarding Foreign Jurisdictions that Prevent Inspections 223 PART III 224 Item 10. Directors, Executive Officers and Corporate Governance 224 Item 11.

Executive Compensation

Executive Compensation 224 Item 12.

Security Ownership of Certain Beneficial Owners and Management and Related Stockholder Matters

Security Ownership of Certain Beneficial Owners and Management and Related Stockholder Matters 224 Item 13. Certain Relationships and Related Transactions, and Director Independence 224 Item 14. Principal Accountant Fees and Services 224 PART IV 225 Item 15. Exhibits and Financial Statement Schedules 225 Item 16. Form 10-K Summary 225 EXHIBIT INDEX 226

SIGNATURES

SIGNATURES 230 2 Capital One Financial Corporation (COF) INDEX OF MD&A AND SUPPLEMENTAL TABLES MD&A Tables: Page 1 Average Balances, Net Interest Income and Net Interest Margin 55 2 Rate/Volume Analysis of Net Interest Income 56 3 Non-Interest Income 57 4 Non-Interest Expense 58 5 Loans Held for Investment 60 6 Funding Sources Composition 60 7 Business Segment Results 63 8 Credit Card Business Results 64 8.1 Domestic Card Business Results 66 9 Consumer Banking Business Results 67 10 Commercial Banking Business Results 69 11 Other Category Results 71 12 Capital Ratios Under Basel III 80 13 Regulatory Risk-Based Capital Components and Regulatory Capital Metrics 81 14 Preferred Stock Dividends Paid Per Share 82 15 Portfolio Composition of Loans Held for Investment 90 16 Loan Maturity Schedule 91 17 Credit Card Portfolio by Geographic Region 91 18 Consumer Banking Portfolio by Geographic Region 92 19 Commercial Real Estate Portfolio by Region 93 20 Commercial Loans by Industry 93 21 Credit Score Distribution 94 22 30+ Day Delinquencies 94 23 Aging and Geography of 30+ Day Delinquent Loans 95 24 90+ Day Delinquent Loans Accruing Interest 96 25 Nonperforming Loans and Other Nonperforming Assets 96 26 Net Charge-Offs (Recoveries) 97 27 Allowance for Credit Losses and Reserve for Unfunded Lending Commitments Activity 99 28 Liquidity Reserves 100 29 Deposits Composition and Average Deposits Interest Rates 102 30 Amount of Time Deposits in Excess of $250,000 by Contractual Maturity 103 31 Long-Term Debt Funding Activities 104 32 Senior Unsecured Long-Term Debt Credit Ratings 104 33 Interest Rate Sensitivity Analysis 108 Supplemental Table s: A Net Charge-Offs 110 B Reconciliation of Non-GAAP Measures 110 3 Capital One Financial Corporation (COF) Table of Contents PART I

Business

Item 1. Business OVERVIEW General Capital One Financial Corporation, a Delaware corporation established in 1994 and headquartered in McLean, Virginia, is a diversified financial services holding company with banking and non-banking subsidiaries. Capital One Financial Corporation and its subsidiaries (the "Company" or "Capital One") offer a broad array of financial products and services to consumers, small businesses and commercial clients through digital channels, branch locations, cafs and other distribution channels. As of December 31, 2023, Capital One Financial Corporation's principal operating subsidiary was Capital One, National Association ("CONA"). On October 1, 2022, the Company completed the merger of Capital One Bank (USA), National Association ("COBNA"), with and into CONA, with CONA as the surviving entity (the "Bank Merger"). The Company is hereafter collectively referred to as "we," "us" or "our." References to the "Bank" shall mean and refer to (i) CONA from and after the Bank Merger and (ii) CONA and COBNA collectively prior to the Bank Merger. References to "this Report" or our "2023 Form 10-K" or "2023 Annual Report" are to our Annual Report on Form 10-K for the fiscal year ended December 31, 2023. All references to 2023, 2022 and 2021, refer to our fiscal years ended, or the dates, as the context requires, December 31, 2023, December 31, 2022 and December 31, 2021, respectively. Certain business terms used in this document are defined in "Part II—Item 7. Management's Discussion and Analysis of Financial Condition and Results of Operations ("MD&A")—Glossary and Acronyms" and should be read in conjunction with the Consolidated Financial Statements included in this Report. We were the third largest issuer of Visa ("Visa") and MasterCard ("MasterCard") credit cards in the U.S. based on the outstanding balance of credit card loans as of December 31, 2023. In addition to credit cards, we also offer debit cards, bank lending, treasury management

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