Capital One Financial (COF) 8-K Results of Operations and Financial Condition

Exhibit 99.3

Capital One Financial Corporation

Reconciliation of Reported GAAP Measures to Managed Basis Non-GAAP Measures

We refer to our consolidated financial statements prepared in accordance with U.S. generally accepted accounting principles ("GAAP") as our "reported" or GAAP financial statements.  Effective January 1, 2010, we prospectively adopted two new consolidation accounting standards that resulted in the conolidation of the substantial majority of our securitization trusts that had been previously treated as off-balance sheet. Prior to our adoption of these new consolidation accounting standards, management evaluated the company's performance on a non-GAAP "managed" basis, which assumed that securitized loans were not sold and the earnings from securitized loans were classified in our results of operations in the same manner as the earnings from loans that we owned.  We believed that our managed basis information is usefu l to investors because it portrays the results of both on- and off-balance sheet loans that we manage, which enables investors to understand and evaluate the credit risks associated with the portfolio of loans reported on our consolidated balance sheet and our retained interests in securitized loans. Our non-GAAP managed basis measures may not be comparable to similarly titled measures used by other companies.

As a result of the January 1, 2010 adoption of the new consolidation accounting standards, the accounting for the loans in our securitization trusts in our reported GAAP financial statements is similar to how we accounted for these loans on a managed basis prior to January 1, 2010. Consequently, we believe our managed basis presentations for periods prior to January 1, 2010 are generally comparable to our reported basis presentations for periods beginning after January 1, 2010.  In periods prior to January 1, 2010, certain of our non-GAAP managed basis measures differed from our comparable reported measures because we assumed, for our managed basis presentation, that securitized loans that were accounted for as sales in our GAAP financial statements remained on our balance sheet.

The following tables, which are described below, provide a reconciliation of reported GAAP financial measures for each quarter of 2009 to our non-GAAP managed basis financial measures included in our filing.  The year-to-date earnings results for each reported period included in our filing can be derived by adding the respective earnings results for each quarter. We also provide a reconciliation of our tangible common equity ratios calculated based on our reported results to ratios calculated based on our non-GAAP managed results.

●	Table 1:  Reported GAAP Measures	—	Reflects selected financial measures from our consolidated GAAP financial statements or metrics calculated based on our consolidated GAAP financial statements.
●	Table 2:  Non GAAP Securitization Reconciliation Adjustments	—	Presents the reconciling differences between our reported GAAP financial measures and our non-GAAP managed basis financial measures.  These differences include certain reclassifications that assume loans securitized by Capital One and accounted for as sales and off-balance sheet transactions in our GAAP financial statements remain on our balance sheet.  These adjustments do not impact net income as reported by our lines of business or the company as a whole.
●	Table 3:  Non GAAP Managed Basis Measures	—	Reflects selected financial measures and related metrics based on our non-GAAP managed basis results.
●	Table 4:  Financial & Statistical Summary Explanatory Footnotes	—	Includes explanatory footnotes that provide additional information for certain financial and statistical measures presented in Tables 1, 2 and 3.
●	Table 5:  Average Balances and Net Interest Margin Non-GAAP Reconciliation	—	Presents a reconciliation of our average balances and net interest margin on a reported basis to our average balances and net interest margin on a non-GAAP managed basis.
●	Table 6:  Tangible Common Equity Non-GAAP Reconciliation	—	Presents a reconciliation of tangible common equity ratios calculated based on our reported results to our tangible common equity ratios calculated on a non-GAAP managed basis.

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CAPITAL ONE FINANCIAL CORPORATION (COF)

FINANCIAL & STATISTICAL SUMMARY

TABLE 1:  REPORTED GAAP MEASURES

	2009
(Dollars in millions, except per share data and as noted)	Q4			Q3			Q2			Q1(7)
Earnings (Reported Basis)
Net interest income	$	1,954		$	2,005		$	1,945		$	1,793
Non-interest Income (1)		1,412			1,553			1,232	(5)		1,090
Total revenue (2)		3,366			3,558			3,177			2,883
Provision for loan and lease losses		844			1,173			934			1,279
Reported Balance Sheet Statistics (Period Average)
Average loans held for investment	$	94,732		$	99,354		$	104,682		$	103,242
Average earning assets		143,663			145,280			150,804			145,172
Average assets		169,856			173,428			177,628			168,489
Return on average assets (ROA)		0.95	%		1.01	%		0.52	%		(0.20	)%
Reported Balance Sheet Statistics (Period End)
Loans held for investment	$	90,619		$	96,714		$	100,940		$	104,921
Total assets		169,622			168,432			171,948			177,431
Tangible assets (A)		155,516			154,315			157,782			163,230
Tangible common equity to tangible assets ratio (B)		8.03	%		7.82	%		7.10	% (6)		5.75	%
Reported Performance Statistics (Quarter over Quarter)
Net interest income growth (3)		(3	)%		3	%		8	%		(1	)%
Non-interest income growth (3)		(9	)%		26	%		13	%		(20	)%
Revenue growth		(5	)%		12	%		10	%		(9	)%
Net interest margin		5.44	%		5.52	%		5.16	%		4.94	%
Revenue margin		9.37	%		9.80	%		8.43	%		7.94	%
Risk-adjusted margin (C)		6.07	%		6.69	%		5.46	%		4.81	%
Non-interest expense as a % of average loans held for investment (annualized)		8.23	%		7.25	%		7.34	%		6.76	%
Efficiency ratio (D)		56.92	%		49.92	%		59.11	%		59.93	%
Reported Asset Quality Statistics
Net charge-offs (4)	$	1,185		$	1,128		$	1,117		$	1,138
Net charge-off rate (4)		5.00	%		4.54	%		4.28	%		4.41	%
30+ day performing delinquency rate (4)		4.13	%		4.12	%		3.71	%		3.65	%

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CAPITAL ONE FINANCIAL CORPORATION (COF)

FINANCIAL & STATISTICAL SUMMARY

TABLE 2:  NON-GAAP SECURITIZATION RECONCILIATION ADJUSTMENTS

	2009
(Dollars in millions, except per share data and as noted)	Q4			Q3			Q2			Q1
Earnings
Net interest income	$	1,216		$	1,207		$	1,013		$	957
Non-interest Income (1)		(213	)		(180	)		(43	)		(104	)
Total revenue (2)		1,003			1,027			970			853
Provision for loan and lease losses		1,003			1,027			970			853
Balance Sheet Statistics (Period Average)
Average loans held for investment	$	43,452		$	44,186		$	43,331		$	43,940
Average earning assets		40,236			40,594			40,404			41,442
Average assets		40,569			41,227			40,774			41,680
Return on average assets (ROA)		(0.18	)%		(0.20	)%		(0.10	)%		0.04	%
Balance Sheet Statistics (Period End)
Loans held for investment	$	46,184		$	44,275		$	45,177		$	44,809
Total assets		42,767			41,251			42,230			42,527
Tangible assets (A)		42,767			41,251			42,230			42,526
Tangible common equity to tangible assets ratio (B)		(1.73	)%		(1.65	)%		(1.50	)%		(1.19	)%
Performance Statistics
Net interest income growth		2	%		6	%		-	%		-	%
Non-interest income growth		(4	) %		(11	) %		8	%		3	%
Revenue growth		-	%		(1	) %		1	%		4	%
Net interest margin		1.46	%		1.39	%		1.03	%		0.95	%
Revenue margin		0.13	%		0.07	%		0.25	%		0.07	%
Risk-adjusted margin		(1.33	)%		(1.46	)%		(1.15	)%		(1.07	)%
Non-interest expense as a % of average loans held for investment		(2.59	)%		(2.23	)%		(2.15	)%		(2.02	)%
Efficiency ratio		(13.07	)%		(11.19	)%		(13.82	)%		(13.68	)%
Asset Quality Statistics
Net charge-offs	$	1,003		$	1,027		$	970		$	853
Net charge-off rate		1.33	%		1.46	%		1.36	%		1.00	%
30+ day performing delinquency rate		0.60	%		0.43	%		0.39	%		0.45	%

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CAPITAL ONE FINANCIAL CORPORATION (COF)

FINANCIAL & STATISTICAL SUMMARY

TABLE 3:  NON-GAAP MANAGED BASIS MEASURES

	2009
(Dollars in millions, except per share data and as noted)	Q4			Q3			Q2			Q1(7)
Earnings (Managed Basis)
Net interest income	$	3,170		$	3,212		$	2,957		$	2,750
Non-interest income (1)		1,199			1,373			1,190	(5)		986
Total revenue (2)		4,369			4,585			4,147			3,736
Provision for loan and lease losses		1,847			2,200			1,904			2,132
Managed Balance Sheet Statistics (Period Average)
Average loans held for investment	$	138,184		$	143,540		$	148,013		$	147,182
Average earning assets		183,899			185,874			191,208			186,614
Average assets		210,425			214,655			218,402			210,169
Return on average assets (ROA)		0.77	%		0.81	%		0.42	%		(0.16	)%
Managed Balance Sheet Statistics (Period End)
Loans held for investment	$	136,803		$	140,990		$	146,117		$	149,730
Total assets		212,389			209,683			214,178			219,958
Tangible assets (A)		198,283			195,566			200,012			205,756
Tangible common equity to tangible assets ratio (B)		6.30	%		6.17	%		5.60	% (6)		4.56	%
Managed Performance Statistics (Quarter over Quarter)
Net interest income growth (3)		(1	)%		9	%		8	%		(1	)%
Non-interest income growth (3)		(13	)%		15	%		21	%		(17	)%
Revenue growth		(5	)%		11	%		11	%		(5	)%
Net interest margin		6.90	%		6.91	%		6.19	%		5.89	%
Revenue margin		9.50	%		9.87	%		8.68	%		8.01	%
Risk-adjusted margin (C)		4.74	%		5.23	%		4.31	%		3.74	%
Non-interest expense as a % of average loans held for investment (annualized)		5.64	%		5.02	%		5.19	%		4.74	%
Efficiency ratio (D)		43.85	%		38.73	%		45.29	%		46.25	%
Asset Quality Statistics
Net charge-offs (4)	$	2,188		$	2,155		$	2,087	��	$	1,991
Net charge-off rate (4)		6.33	%		6.00	%		5.64	%		5.41	%
30+ day performing delinquency rate (4)		4.73	%		4.55	%		4.10	%		4.10	%

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CAPITAL ONE FINANCIAL CORPORATION (COF)

TABLE 4:  FINANCIAL & STATISTICAL SUMMARY EXPLANATORY NOTES

(1) Includes the impact from the change in fair value of retained interests, including the interest-only strips, which totaled $55 million in Q4 2009, $37 million in Q3 2009, $(115) million in Q2 2009 and $(128) million in Q1 2009.

(2) Billed finance charges and fees not included in revenue totaled: $490 million in Q4 2009, $517 million in Q3 2009, $572 million in Q2 2009 and $544 million in Q1 2009.

(3) Prior period amounts have been reclassified to conform with the current period presentation and adjusted to reflect purchase accounting refinements related to the acquisition of Chevy Chase Bank, FSB ("CCB").

(4) The denominator used in calculating the allowance as a % of loans held for investment, the net charge-off rate and the 30+ day performing delinquency rate includes loans acquired as part of the CCB acquisition. These metrics, calculated excluding CCB loans, are presented below.

(Dollars in millions)	Q4 2009			Q3 2009			Q2 2009			Q1 2009
CCB period end acquired loan portfolio (unaudited)	$	7,251		$	7,885		$	8,644		$	8,859
CCB average acquired loan portfolio (unaudited)	$	7,512		$	8,029		$	8,499		$	3,073
Allowance as a % of loans held for investment, excluding CCB		4.95	%		5.08	%		4.86	%		4.84	%
Net charge-off rate (Reported), excluding CCB		5.44	%		4.94	%		4.65	%		4.54	%
Net charge-off rate (Managed), excluding CCB		6.70	%		6.36	%		5.98	%		5.53	%
30+ day performing delinquency rate (Reported), excluding CCB		4.49	%		4.48	%		4.06	%		3.99	%
30+ day performing delinquency rate (Managed), excluding CCB		4.99	%		4.82	%		4.36	%		4.36	%

(5) In Q2 2009, the Company elected to convert and sell 404,508 shares of MasterCard class B common stock, which resulted in a gain of $66 million that is included in non-interest income.

(6) Includes the impact of the issuance of 56,000,000 common shares at $27.75 per share on May 14, 2009.

(7) Effective February 27, 2009, the Company acquired Chevy Chase Bank, FSP for $476 million, which included a cash payment of $445 million and the issuance of 2.6 million common shares valued at $31 million.  The acquistion of Chevy Chase Bank included $10 billion in loans and $13.6 billion in deposits.

STATISTICS / METRIC CALCULATIONS

(A) Tangible assets represents total assets from continuing operations less identifiable intangible assets and goodwill. See Table 6: Tangible Common Equity Non-GAAP Reconciliation.

(B) Tangible common equity ("TCE") represents common stockholders' equity (total stockholders' equity less preferred stock) less identifable intangible assets and goodwill.  See Table 6: Tangible Common Equity Non-GAAP Reconciliation.

(C) Calculated based on total revenue less net charge-offs divided by average earning assets, expressed as a percentage.

(D) Calculated based on non-interest expense less restructuring expense divided by total revenue.

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CAPITAL ONE FINANCIAL CORPORATION

TABLE 5: AVERAGE BALANCES AND NET INTEREST MARGIN NON-GAAP RECONCILIATION(1)

(Dollars in millions)	Quarter Ended 06/30/09
Reported Basis	Average		Income/		Yield/
	Balance		Expense		Rate
Interest-earning assets:
Loans held for investment	$	104,682	$	2,237		8.55	%
Other		8,623		68		3.15	%
Total interest-earning assets	$	150,804	$	2,717		7.21	%
Interest-bearing liabilities:
Securitization liability		5,876		74		5.04	%
Total interest-bearing liabilities	$	131,631	$	772		2.35	%
Net interest spread						4.86	%
Interest income to average interest-earning assets						7.21	%
Interest expense to average interest-earning assets						2.05	%
Net interest margin						5.16	%

Non-GAAP Securitization Reconciliation Adjustments	Quarter Ended 06/30/09
	Average			Income/			Yield/
Interest-earning assets:	Balance			Expense			Rate
Loans held for investment	$	43,331		$	1,331			1.09	%
Other		(2,927	)		(51	)		(1.96	)%
Total interest-earning assets	$	40,404		$	1,280			1.15	%
Interest-bearing liabilities:
Securitization liability		40,806			268			(2.11	)%
Total interest-bearing liabilities	$	40,806		$	268			0.06	%
Net interest spread								1.09	%
Interest income to average interest-earning assets								1.15	%
Interest expense to average interest-earning assets								0.12	%
Net interest margin								1.03	%

Non-GAAP Managed Basis	Quarter Ended 06/30/09
	Average		Income/		Yield/
Interest-earning assets:	Balance		Expense		Rate
Loans held for investment	$	148,013	$	3,568		9.64	%
Other		5,696		17		1.19	%
Total interest-earning assets	$	191,208	$	3,997		8.36	%
Interest-bearing liabilities:
Securitization liability		46,682		342		2.93	%
Total interest-bearing liabilities	$	172,437	$	1,040		2.41	%
Net interest spread						5.95	%
Interest income to average interest-earning assets						8.36	%
Interest expense to average interest-earning assets						2.17	%
Net interest margin						6.19	%

(1) Reflects amounts based on continuing operations.

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CAPITAL ONE FINANCIAL CORPORATION

TANGIBLE COMMON EQUITY NON-GAAP RECONCILIATION

The table below presents reconciliation adjustments necessary to calculate our non-GAAP tangible common equity ("TCE") ratios for the periods presented. The Company believes the non-GAAP TCE ratio is a meaningful measure to use in assessing the Company's capital strength. This measure may not be comparable to similarly titled measures used by other companies.

	2010			2010			2009			2009			2009
(Dollars in millions)	Q2			Q1			Q4			Q3			Q2
Reconciliation of Average Equity to Average Tangible Common Equity
Average equity	$	24,526		$	23,681		$	26,518		$	26,002		$	27,668
Less: Preferred stock		-			-			-			-			41
Less: Average intangible assets (1)		(14,039	)		(14,075	)		(14,105	)		(14,151	)		(14,129	)
Average Tangible Common Equity	$	10,487		$	9,606		$	12,413		$	11,851		$	13,580
Reconciliation of Period End Equity to Tangible Common Equity
Stockholders' equity	$	25,270		$	24,374		$	26,589		$	26,192		$	25,332
Less: Preferred stock		-			-			-			-			38
Less: Intangible assets (1)		(14,011	)		(14,044	)		(14,106	)		(14,117	)		(14,166	)
Period End Tangible Common Equity	$	11,259		$	10,330		$	12,483		$	12,075		$	11,204
Reconciliation of Period End Assets to Tangible Assets
Total assets	$	197,489		$	200,707		$	169,646		$	168,463		$	171,994
Less: Assets—discontinued operations		(10	)		(16	)		(24	)		(31	)		(46	)
Total assets—continuing operations		197,479			200,691			169,622			168,432			171,948
Less: Intangible assets (1)		(14,011	)		(14,044	)		(14,106	)		(14,117	)		(14,166	)
Period End Tangible Assets	$	183,468		$	186,647		$	155,516		$	154,315		$	157,782
TCE ratio (2)		6.14	%		5.53	%		8.03	%		7.82	%		7.10	%
Reconciliation of Period End Assets to Tangible Assets on a Managed Basis
Total reported assets	$	197,489		$	200,707		$	169,646		$	168,463		$	171,994
Securitization adjustments (3)		-			-			42,767			41,251			42,230
Total non-GAAP managed assets		197,489			200,707			212,413			209,714			214,224
Less: Assets—discontinued operations		(10	)		(16	)		(24	)		(31	)		(46	)
Total assets—continuing operations		197,479			200,691			212,389			209,683			214,178
Less: Intangible Assets (1)		(14,011	)		(14,044	)		(14,106	)		(14,117	)		(14,166	)
Period End Tangible Assets	$	183,468		$	186,647		$	198,283		$	195,566		$	200,012
TCE ratio (2)		6.14	%		5.53	%		6.30	%		6.17	%		5.60	%

(1) Presented net of related deferred taxes.

(2) Calculated based on tangible common equity divided by tangible assets.

(3) Reflects adjustments to our reported GAAP results to reflect loans that have been securitized and accounted for as sales on a GAAP basis as though the loans remained on our consolidated balance sheets.

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