Capital One Financial Corp. Files 10-Q for Q1 2024

TL;DR

<b>Capital One Financial Corp. filed its Q1 2024 10-Q, detailing financial positions and equity components.</b>

AI Summary

CAPITAL ONE FINANCIAL CORP (COF-PN) filed a Quarterly Report (10-Q) with the SEC on May 2, 2024. Capital One Financial Corp. filed its 10-Q report for the period ending March 31, 2024. The filing covers the first quarter of 2024. Key financial data points such as common stock, preferred stock, additional paid-in capital, retained earnings, accumulated other comprehensive income, and treasury stock are detailed for the periods ending March 31, 2024, December 31, 2023, and December 31, 2022. The report includes references to specific financial instruments like Series I, J, K, L, N Preferred Stock and Senior Notes due 2024 and 2029. The company's principal executive offices are located at 1680 Capital One Drive, Suite 1400, McLean, VA 22102.

Why It Matters

For investors and stakeholders tracking CAPITAL ONE FINANCIAL CORP, this filing contains several important signals. This 10-Q filing provides a detailed snapshot of Capital One's financial health and equity structure as of the end of the first quarter of 2024, crucial for investors assessing the company's stability and capital management. The specific breakdown of various stock series and debt instruments offers insight into the company's financing strategies and potential liabilities.

Risk Assessment

Risk Level: medium — CAPITAL ONE FINANCIAL CORP shows moderate risk based on this filing. The filing is a standard quarterly report (10-Q) for a large financial institution, which inherently carries market and regulatory risks, but this specific filing does not highlight any immediate, severe new risks.

Analyst Insight

Monitor the detailed financial statements and equity changes in this 10-Q for trends in Capital One's capital structure and financial performance.

Key Numbers

• 2024-03-31 — Report Period End Date (10-Q filing)
• 2024-01-01 — Report Period Start Date (10-Q filing)
• 2023-12-31 — Prior Period End Date (10-Q filing)
• 2022-12-31 — Prior Year End Date (10-Q filing)

Key Players & Entities

• Capital One Financial Corp. (company) — Filer name
• 0000927628 (company) — Central Index Key
• 1680 Capital One Drive, Suite 1400, McLean, VA 22102 (company) — Business address
• 7037201000 (company) — Business phone
• Oakstone Financial Corp (company) — Former company name
• 19940728 (company) — Date of name change

FAQ

Risk Factors

• Regulatory Compliance [high — regulatory]: The company must comply with numerous federal and state laws and regulations applicable to financial institutions, including those related to consumer protection, banking, and securities.
• Market and Economic Conditions [high — market]: The company's financial performance is significantly influenced by general economic conditions, including interest rate fluctuations, credit cycles, and the overall health of the U.S. and global economies.
• Operational Risks [medium — operational]: The company faces risks related to its technology systems, data security, business continuity, and the ability to attract and retain qualified personnel.
• Credit Risk [high — financial]: The company is exposed to credit risk, which is the risk of loss resulting from a borrower's failure to repay a loan or meet other contractual obligations.

Key Dates

• 2024-03-31: Quarter End Date — Marks the end of the reporting period for the 10-Q.

Key Financial Figures

• $20 million — companies with annual revenues between $20 million and $2 billion. 4 Capital One Financ
• $2 billion — annual revenues between $20 million and $2 billion. 4 Capital One Financial Corporation
• $1.3 billion — l Highlights We reported net income of $1.3 billion ($3.13 per diluted common share) on tot
• $3.13 — We reported net income of $1.3 billion ($3.13 per diluted common share) on total net
• $9.4 billion — d common share) on total net revenue of $9.4 billion for the first quarter of 2024. In compa
• $960 million — n comparison, we reported net income of $960 million ($2.31 per diluted common share) on tot
• $2.31 — we reported net income of $960 million ($2.31 per diluted common share) on total net
• $8.9 billion — d common share) on total net revenue of $8.9 billion for the first quarter of 2023. Our com
• $238 million — ared and paid common stock dividends of $238 million and repurchased $103 million of shares
• $103 million — vidends of $238 million and repurchased $103 million of shares of our common stock. See "Cap
• $320 million — Earnings: Our net income increased by $320 million to $1.3 billion in the first quarter of
• $42 million — en by increased marketing spend and the $42 million of incremental expense recognized in th
• $5.3 billion — loans held for investment decreased by $5.3 billion to $315.2 billion as of March 31, 2024
• $315.2 billion — investment decreased by $5.3 billion to $315.2 billion as of March 31, 2024 from December 31,
• $6.9 billion — loans held for investment increased by $6.9 billion to $314.6 billion in the first quarter

Filing Documents

• cof-20240331.htm (10-Q) — 5921KB
• cof-03312024x10qxex106.htm (EX-10.6) — 21KB
• cof-03312024x10qxex311.htm (EX-31.1) — 11KB
• cof-03312024x10qxex312.htm (EX-31.2) — 11KB
• cof-03312024x10qxex321.htm (EX-32.1) — 6KB
• cof-03312024x10qxex322.htm (EX-32.2) — 6KB
• 0000927628-24-000174.txt (&nbsp;) — 25681KB
• cof-20240331.xsd (EX-101.SCH) — 87KB
• cof-20240331_cal.xml (EX-101.CAL) — 143KB
• cof-20240331_def.xml (EX-101.DEF) — 668KB
• cof-20240331_lab.xml (EX-101.LAB) — 1102KB
• cof-20240331_pre.xml (EX-101.PRE) — 897KB
• cof-20240331_htm.xml (XML) — 6458KB

- FINANCIAL INFORMATION

PART I - FINANCIAL INFORMATION 4 Item 1.

Financial Statements and Notes

Financial Statements and Notes 72 Consolidated Statements of Income 73 Consolidated Statements of Comprehensive Income 74 Consolidated Balance Sheets 75 Consolidated Statements of Changes in Stockholders' Equity 76 Consolidated Statements of Cash Flows 77

Notes to Consolidated Financial Statements

Notes to Consolidated Financial Statements 79 Note 1—Summary of Significant Accounting Policies 79 Note 2—Business Combinations 81 Note 3—Investment Securities 82 Note 4—Loans 85 Note 5—Allowance for Credit Losses and Reserve for Unfunded Lending Commitments 96 Note 6—Variable Interest Entities and Securitizations 100 Note 7—Goodwill and Other Intangible Assets 104 Note 8—Deposits and Borrowings 106 Note 9—Derivative Instruments and Hedging Activities 107 Note 10—Stockholders' Equity 115 Note 11—Earnings Per Common Share 118 Note 12—Fair Value Measurement 119 Note 13—Business Segments and Revenue from Contracts with Customers 126 Note 14—Commitments, Contingencies, Guarantees and Others 129 Item 2.

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") 4 Introduction 4

Selected Financial Data

Selected Financial Data 6 Executive Summary 9 Consolidated Results of Operations 10 Consolidated Balance Sheets Analysis 16 Off-Balance Sheet Arrangements 19 Business Segment Financial Performance 20 Critical Accounting Policies and Estimates 29 Accounting Changes and Developments 30 Capital Management 31 Risk Management 36 Credit Risk Profile 38 Liquidity Risk Profile 51 Market Risk Profile 56 Supervision and Regulation 59

Forward-Looking Statements

Forward-Looking Statements 61 Supplemental Table 64 Glossary and Acronyms 66 1 Capital One Financial Corporation (COF) Item 3.

Quantitative and Qualitative Disclosures about Market Risk

Quantitative and Qualitative Disclosures about Market Risk 133 Item 4.

Controls and Procedures

Controls and Procedures 133

—OTHER INFORMATION

PART II—OTHER INFORMATION 134 Item 1.

Legal Proceedings

Legal Proceedings 134 Item 1A.

Risk Factors

Risk Factors 134 Item 2. Unregistered Sales of Equity Securities and Use of Proceeds 134 Item 3. Defaults Upon Senior Securities 134 Item 4. Mine Safety Disclosures 134 Item 5. Other Information 134 Item 6. Exhibits 134 EXHIBIT INDEX 135

SIGNATURES

SIGNATURES 136 2 Capital One Financial Corporation (COF) INDEX OF MD&A AND SUPPLEMENTAL TABLE MD&A Tables: Page 1 Consolidated Financial Highlights 6 2 Average Balances, Net Interest Income and Net Interest Margin 11 3 Rate/Volume Analysis of Net Interest Income 13 4 Non-Interest Income 14 5 Non-Interest Expense 15 6 Loans Held for Investment 17 7 Funding Sources Composition 17 8 Business Segment Results 21 9 Credit Card Business Results 22 9.1 Domestic Card Business Results 24 10 Consumer Banking Business Results 25 11 Commercial Banking Business Results 26 12 Other Category Results 28 13 Capital Ratios Under Basel III 33 14 Regulatory Risk-Based Capital Components and Regulatory Capital Metrics 34 15 Preferred Stock Dividends Paid Per Share 35 16 Portfolio Composition of Loans Held for Investment 38 17 Credit Card Portfolio by Geographic Region 39 18 Consumer Banking Portfolio by Geographic Region 40 19 Commercial Real Estate Portfolio by Region 41 20 Commercial Loans by Industry 42 21 Credit Score Distribution 43 22 30+ Day Delinquencies 44 23 Aging and Geography of 30+ Day Delinquent Loans 45 24 90+ Day Delinquent Loans Accruing Interest 46 25 Nonperforming Loans and Other Nonperforming Assets 46 26 Net Charge-Of f s 47 27 Allowance for Credit Losses and Reserve for Unfunded Lending Commitments Activity 50 28 Liquidity Reserves 51 29 Deposits Composition and Average Deposits Interest Rates 53 30 Long-Term Debt Funding Activities 54 31 Senior Unsecured Long-Term Debt Credit Ratings 55 32 Interest Rate Sensitivity Analysis 58 Supplemental Table : A Reconciliation of Non-GAAP Measures 64 3 Capital One Financial Corporation (COF) Table of Contents

— FINANCIAL INFORMATION

PART I — FINANCIAL INFORMATION

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

Item 2. Management's Discussion and Analysis of Financial Condition and Results of Operations ("MD&A") This discussion contains forward-looking statements that are based upon management's current expectations and are subject to significant uncertainties and changes in circumstances. Please review "Forward-Looking Statements" for more information on the forward-looking statements in this Quarterly Report on Form 10-Q ("this Report"). All statements that address operating performance, events or developments that we expect or anticipate will occur in the future are forward-looking statements. Our actual results may differ materially from those included in these forward-looking statements due to a variety of factors including, but not limited to, those described in "Part I—Item 1A. Risk Factors" in our 2023 Annual Report on Form 10-K ("2023 Form 10-K") and "Part II—Item 1A. Risk Factors" in this Report. Unless otherwise specified, references to notes to our consolidated financial statements refer to the notes to our consolidated financial statements as of March 31, 2024 included in this Report. Management monitors a variety of key indicators to evaluate our business results and financial condition. The following MD&A is provided as a supplement to, and should be read in conjunction with, our consolidated financial statements and related notes in this Report and the more detailed information contained in our 2023 Form 10-K. INTRODUCTION 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 March 31, 2024, Capital One Financial

SELECTED FINANCIAL DATA

SELECTED FINANCIAL DATA The following table presents selected consolidated financial data and performance from our results of operations for the first quarters of 2024 and 2023 and selected comparative balance sheet data as of March 31, 2024 and December 31, 2023. We also provide selected key metrics we use in evaluating our performance, including certain metrics that are computed using non-GAAP measures. We consider these metrics to be key financial measures that management uses in assessing our operating performance, capital adequacy and the level of returns generated. We believe these non-GAAP metrics provide useful insight 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 United States of America ("U.S. GAAP"), nor are they necessarily comparable to non-GAAP measures that may be presented by other companies. Table 1: Consolidated Financial Highlights Three Months Ended March 31, (Dollars in millions, except per share data and as noted) 2024 2023 Change Income statement Net interest income $ 7,488 $ 7,186 4% Non-interest income 1,914 1,717 11 Total net revenue 9,402 8,903 6 Provision for credit losses 2,683 2,795 (4) Non-interest expense: Marketing 1,010 897 13 Operating expense 4,127 4,048 2 Total non-interest expense 5,137 4,945 4 Income from continuing operations before income taxes 1,582 1,163 36 Income tax provision 302 203 49 Net income 1,280 960 33 Dividends and undistributed earnings allocated to participating securities (23) (16) 44 Preferred stock dividends (57) (57) — Net income available to common stockholders $ 1,200 $ 887 35 Common share statistics Basic earnings per common share: Net income per basic common share $ 3.14 $ 2

View Full Filing

View this 10-Q filing on SEC EDGAR