Exhibit 99.1
CAPITAL ONE FINANCIAL CORPORATION (COF)
FINANCIAL & STATISTICAL SUMMARY REPORTED BASIS
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| | | 2004 | | | 2004 | | | 2004 | | | 2004 | | | 2003 | |
| (in millions, except per share data and as noted) | | Q4
| | | Q3
| | | Q2
| | | Q1
| | | Q4
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Earnings (Reported Basis) | | | | | | | | | | | | | | | | | | | | |
Net Interest Income | | $ | 784.6 | | | $ | 775.4 | | | $ | 711.0 | | | $ | 732.0 | | | $ | 664.1 | |
Non-Interest Income | | | 1,521.5 | (1) | | | 1,539.4 | (1) | | | 1,396.1 | | | | 1,443.1 | | | | 1,437.5 | |
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Total Revenue(2) | | | 2,306.1 | | | | 2,314.8 | | | | 2,107.1 | | | | 2,175.1 | | | | 2,101.6 | |
Provision for Loan Losses | | | 467.1 | | | | 267.8 | | | | 242.3 | | | | 243.7 | | | | 390.4 | |
Marketing Expenses | | | 511.1 | | | | 317.7 | | | | 253.8 | | | | 255.1 | | | | 290.1 | |
Operating Expenses | | | 1,045.4 | (3) | | | 994.3 | (3) | | | 975.0 | (3) | | | 969.7 | | | | 999.3 | |
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Income Before Taxes | | | 282.5 | | | | 735.0 | | | | 636.0 | | | | 706.6 | | | | 421.7 | |
Tax Rate | | | 30.9 | % | | | 33.3 | % | | | 36.0 | % | | | 36.2 | % | | | 37.0 | % |
Net Income | | $ | 195.1 | | | $ | 490.2 | | | $ | 407.4 | | | $ | 450.8 | | | $ | 265.7 | |
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Common Share Statistics | | | | | | | | | | | | | | | | | | | | |
Basic EPS | | $ | 0.82 | | | $ | 2.07 | | | $ | 1.74 | | | $ | 1.94 | | | $ | 1.16 | |
Diluted EPS | | $ | 0.77 | | | $ | 1.97 | | | $ | 1.65 | | | $ | 1.84 | | | $ | 1.11 | |
Dividends Per Share | | $ | 0.03 | | | $ | 0.03 | | | $ | 0.03 | | | $ | 0.03 | | | $ | 0.03 | |
Book Value Per Share (period end) | | $ | 33.99 | | | $ | 32.67 | | | $ | 29.90 | | | $ | 28.54 | | | $ | 25.75 | |
Stock Price Per Share (period end) | | $ | 84.21 | | | $ | 73.90 | | | $ | 68.38 | | | $ | 75.43 | | | $ | 61.29 | |
Total Market Capitalization (period end) | | $ | 20,783.0 | | | $ | 17,936.8 | | | $ | 16,514.5 | | | $ | 18,084.9 | | | $ | 14,405.7 | |
Shares Outstanding (period end) | | | 246.8 | | | | 242.7 | | | | 241.5 | | | | 239.8 | | | | 235.0 | |
Shares Used to Compute Basic EPS | | | 239.2 | | | | 236.4 | | | | 234.7 | | | | 232.0 | | | | 228.1 | |
Shares Used to Compute Diluted EPS | | | 253.0 | | | | 249.0 | | | | 247.6 | | | | 245.4 | | | | 239.2 | |
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Reported Balance Sheet Statistics (period avg.) | | | | | | | | | | | | | | | | | | | | |
Average Loans | | $ | 36,096 | | | $ | 34,772 | | | $ | 33,290 | | | $ | 32,878 | | | $ | 31,297 | |
Average Earning Assets | | $ | 49,500 | | | $ | 47,267 | | | $ | 45,705 | | | $ | 44,112 | | | $ | 40,792 | |
Average Assets | | $ | 53,339 | | | $ | 51,496 | | | $ | 50,020 | | | $ | 47,699 | | | $ | 45,002 | |
Average Equity | | $ | 8,221 | | | $ | 7,561 | | | $ | 6,943 | | | $ | 6,443 | | | $ | 5,887 | |
Return on Average Assets (ROA) | | | 1.46 | % | | | 3.81 | % | | | 3.26 | % | | | 3.78 | % | | | 2.36 | % |
Return on Average Equity (ROE) | | | 9.49 | % | | | 25.93 | % | | | 23.47 | % | | | 27.99 | % | | | 18.05 | % |
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Reported Balance Sheet Statistics (period end) | | | | | | | | | | | | | | | | | | | | |
Loans | | $ | 38,216 | | | $ | 35,161 | | | $ | 34,551 | | | $ | 33,172 | | | $ | 32,850 | |
Total Assets | | $ | 53,747 | | | $ | 51,960 | | | $ | 50,070 | | | $ | 49,146 | | | $ | 46,284 | |
Capital(4) | | $ | 9,231 | | | $ | 8,769 | | | $ | 8,057 | | | $ | 7,675 | | | $ | 6,882 | |
Loan growth | | $ | 3,055 | | | $ | 610 | | | $ | 1,379 | | | $ | 321 | | | $ | 2,232 | |
% Loan Growth Q Over Q (annualized) | | | 35 | % | | | 7 | % | | | 17 | % | | | 4 | % | | | 29 | % |
% Loan Growth Y Over Y | | | 16 | % | | | 15 | % | | | 29 | % | | | 20 | % | | | 20 | % |
Capital to Assets Ratio | | | 17.17 | % | | | 16.88 | % | | | 16.09 | % | | | 15.62 | % | | | 14.87 | % |
Capital plus Allowance to Assets Ratio | | | 19.98 | % | �� | | 19.56 | % | | | 18.94 | % | | | 18.66 | % | | | 18.31 | % |
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Revenue & Expense Statistics (Reported) | | | | | | | | | | | | | | | | | | | | |
Net Interest Income Growth (annualized) | | | 5 | % | | | 36 | % | | | (11 | )% | | | 41 | % | | | (23 | )% |
Non Interest Income Growth (annualized) | | | (5 | )% | | | 41 | % | | | (13 | )% | | | 2 | % | | | 22 | % |
Revenue Growth (annualized) | | | (2 | )% | | | 39 | % | | | (13 | )% | | | 14 | % | | | 7 | % |
Net Interest Margin | | | 6.34 | % | | | 6.56 | % | | | 6.22 | % | | | 6.64 | % | | | 6.51 | % |
Revenue Margin | | | 18.64 | % | | | 19.59 | % | | | 18.44 | % | | | 19.72 | % | | | 20.61 | % |
Risk Adjusted Margin(5) | | | 15.85 | % | | | 17.07 | % | | | 15.73 | % | | | 16.62 | % | | | 17.02 | % |
Operating Expense as a % of Revenues | | | 45.33 | % | | | 42.95 | % | | | 46.27 | % | | | 44.58 | % | | | 47.55 | % |
Operating Expense as a % of Avg Loans (annualized) | | | 11.58 | % | | | 11.44 | % | | | 11.72 | % | | | 11.80 | % | | | 12.77 | % |
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Asset Quality Statistics (Reported) | | | | | | | | | | | | | | | | | | | | |
Allowance | | $ | 1,505 | | | $ | 1,395 | | | $ | 1,425 | | | $ | 1,495 | | | $ | 1,595 | |
30+ Day Delinquencies | | $ | 1,472 | | | $ | 1,407 | | | $ | 1,351 | | | $ | 1,266 | | | $ | 1,573 | |
Net Charge-Offs | | $ | 345 | | | $ | 298 | | | $ | 310 | | | $ | 342 | | | $ | 366 | |
Allowance as a % of Reported Loans | | | 3.94 | % | | | 3.97 | % | | | 4.12 | % | | | 4.51 | % | | | 4.86 | % |
Delinquency Rate (30+ days) | | | 3.85 | % | | | 4.00 | % | | | 3.91 | % | | | 3.82 | % | | | 4.79 | % |
Net Charge-Off Rate | | | 3.82 | % | | | 3.43 | % | | | 3.72 | % | | | 4.17 | % | | | 4.68 | % |
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| (1) | Includes a $41.1 million gain resulting from the sale of the French loan portfolio in Q4 2004 and a $31.5 million gain resulting from the sale of a joint venture investment in South Africa in Q3 2004. |
| (2) | 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: Q4 2004—$276.8, Q3 2004—$269.7, Q2 2004—$263.5 million, Q1 2004—$285.5 million and Q4 2003—$454.8 million. |
| (3) | Includes employee termination benefits and charges for facility consolidation related to corporate-wide cost reduction initiatives of $42.1 million, $26.7 million and $56.0 million for Q4 2004, Q3 2004 and Q2 2004, respectively. In addition, Q3 2004 had charges of $20.6 million related to a change in fixed asset capitalization thresholds and $15.8 million related to impairment of internally developed software. |
| (4) | Includes preferred interests and mandatory convertible securities. |
| (5) | Risk adjusted margin is total revenue less net charge-offs as a percentage of average earning assets. |
CAPITAL ONE FINANCIAL CORPORATION (COF)
FINANCIAL & STATISTICAL SUMMARY MANAGED BASIS(1)
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| | | 2004 | | | 2004 | | | 2004 | | | 2004 | | | 2003 | |
| (in millions) | | Q4
| | | Q3
| | | Q2
| | | Q1
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Earnings (Managed Basis) | | | | | | | | | | | | | | | | | | | | |
Net Interest Income | | $ | 1,701.8 | | | $ | 1,670.4 | | | $ | 1,585.4 | | | $ | 1,677.1 | | | $ | 1,571.7 | |
Non-Interest Income | | | 1,099.0 | (2) | | | 1,099.8 | (2) | | | 1,011.3 | | | | 1,014.5 | | | | 1,077.5 | |
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Total Revenue(3) | | | 2,800.8 | | | | 2,770.2 | | | | 2,596.7 | | | | 2,691.6 | | | | 2,649.2 | |
Provision for Loan Losses | | | 961.8 | | | | 723.2 | | | | 731.9 | | | | 760.1 | | | | 938.0 | |
Marketing Expenses | | | 511.1 | | | | 317.7 | | | | 253.8 | | | | 255.1 | | | | 290.1 | |
Operating Expenses | | | 1,045.4 | (4) | | | 994.3 | (4) | | | 975.0 | (4) | | | 969.7 | | | | 999.3 | |
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Income Before | | | 282.5 | | | | 735.0 | | | | 636.0 | | | | 706.6 | | | | 421.7 | |
Tax Rate | | | 30.9 | % | | | 33.3 | % | | | 36.0 | % | | | 36.2 | % | | | 37.0 | % |
Net Income | | $ | 195.1 | | | $ | 490.2 | | | $ | 407.4 | | | $ | 450.8 | | | $ | 265.7 | |
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Managed Balance Sheet Statistics (period avg.) | | | | | | | | | | | | | | | | | | | | |
Average Loans | | $ | 76,930 | | | $ | 74,398 | | | $ | 72,327 | | | $ | 71,148 | | | $ | 68,679 | |
Average Earning Assets | | $ | 88,461 | | | $ | 85,045 | | | $ | 82,905 | | | $ | 80,495 | | | $ | 76,277 | |
Average Assets | | $ | 93,574 | | | $ | 90,543 | | | $ | 88,473 | | | $ | 85,324 | | | $ | 81,733 | |
Return on Average Assets (ROA) | | | 0.83 | % | | | 2.17 | % | | | 1.84 | % | | | 2.11 | % | | | 1.30 | % |
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Managed Balance Sheet Statistics (period end) | | | | | | | | | | �� | | | | | | | | | | |
Loans | | $ | 79,861 | | | $ | 75,457 | | | $ | 73,367 | | | $ | 71,817 | | | $ | 71,245 | |
Total Assets | | $ | 94,792 | | | $ | 91,665 | | | $ | 88,317 | | | $ | 87,197 | | | $ | 83,999 | |
Loan Growth | | $ | 4,404 | | | $ | 2,090 | | | $ | 1,550 | | | $ | 572 | | | $ | 3,985 | |
% Loan Growth Q over Q (annualized) | | | 23 | % | | | 11 | % | | | 9 | % | | | 3 | % | | | 24 | % |
% Loan Growth Y over Y | | | 12 | % | | | 12 | % | | | 21 | % | | | 21 | % | | | 19 | % |
Capital to Assets Ratio | | | 9.74 | % | | | 9.57 | % | | | 9.12 | % | | | 8.80 | % | | | 8.19 | % |
Capital plus Allowance to Assets Ratio | | | 11.33 | % | | | 11.09 | % | | | 10.74 | % | | | 10.52 | % | | | 10.09 | % |
Number of Accounts (000’s) | | | 48,573 | | | | 47,224 | | | | 46,591 | | | | 46,712 | | | | 47,038 | |
% Off-Balance Sheet Securitizations | | | 52 | % | | | 53 | % | | | 53 | % | | | 53 | % | | | 53 | % |
% at Introductory Rate | | | 7 | % | | | 6 | % | | | 6 | % | | | 8 | % | | | 10 | % |
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Revenue & Expense Statistics (Managed) | | | | | | | | | | | | | | | | | | | | |
Net Interest Income Growth (annualized) | | | 8 | % | | | 21 | % | | | (22 | )% | | | 27 | % | | | 19 | % |
Non Interest Income Growth (annualized) | | | 0 | % | | | 35 | % | | | (1 | )% | | | (23 | )% | | | 11 | % |
Revenue Growth (annualized) | | | 4 | % | | | 27 | % | | | (14 | )% | | | 6 | % | | | 16 | % |
Net Interest Margin | | | 7.70 | % | | | 7.86 | % | | | 7.65 | % | | | 8.33 | % | | | 8.24 | % |
Revenue Margin | | | 12.66 | % | | | 13.03 | % | | | 12.53 | % | | | 13.38 | % | | | 13.89 | % |
Risk Adjusted Margin(5) | | | 8.87 | % | | | 9.48 | % | | | 8.67 | % | | | 9.11 | % | | | 9.10 | % |
Operating Expense as a % of Revenues | | | 37.33 | % | | | 35.89 | % | | | 37.55 | % | | | 36.03 | % | | | 37.72 | % |
Operating Expense as a % of Avg Loans (annualized) | | | 5.44 | % | | | 5.35 | % | | | 5.39 | % | | | 5.45 | % | | | 5.82 | % |
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Asset Quality Statistics (Managed) | | | | | | | | | | | | | | | | | | | | |
30+ Day Delinquencies | | $ | 3,054 | | | $ | 2,944 | | | $ | 2,756 | | | $ | 2,731 | | | $ | 3,178 | |
Net Charge-Offs | | $ | 840 | | | $ | 754 | | | $ | 800 | | | $ | 859 | | | $ | 914 | |
Delinquency Rate (30+ days) | | | 3.82 | % | | | 3.90 | % | | | 3.76 | % | | | 3.80 | % | | | 4.46 | % |
Net Charge-Off Rate | | | 4.37 | % | | | 4.05 | % | | | 4.42 | % | | | 4.83 | % | | | 5.32 | % |
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| (1) | The information in this statistical summary reflects the adjustment to add back the effect of securitization transaction qualifying as sales under generally accepted accounting principles. See accompanying schedule—“Reconciliation to GAAP Financial Measures”. |
| (2) | Includes a $41.1 million gain resulting from the sale of the French loan portfolio in Q4 2004 and a $31.5 million gain resulting from the sale of a joint venture investment in South Africa in Q3 2004. |
| (3) | 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: Q4 2004—$276.8, Q3 2004—$269.7 million, Q2 2004—$263.5 million, Q1 2004—$285.5 million and Q4 2003—$454.8 million. |
| (4) | Includes employee termination benefits and charges for facility consolidation related to corporate-wide cost reduction initiatives of $42.1 million, $26.7 million and $56.0 million for Q4 2004, Q3 2004 and Q2 2004, respectively. In addition, Q3 2004 had charges of $20.6 million related to a change in fixed asset capitalization thresholds and $15.8 million related to impairment of internally developed software. |
| (5) | Risk adjusted margin is total revenue less net charge-offs as a percentage of average earning assets. |
CAPITAL ONE FINANCIAL CORPORATION (COF)
SEGMENT FINANCIAL & STATISTICAL SUMMARY—MANAGED BASIS(1)
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(in millions) | | 2004 Q4
| | | 2004 Q3
| | | 2004 Q2
| | | 2004 Q1
| | | 2003 Q4
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Segment Statistics | | | | | | | | | | | | | | | | | | | | |
US Card: | | | | | | | | | | | | | | | | | | | | |
Loans receivable | | $ | 48,610 | | | $ | 46,082 | | | $ | 45,247 | | | $ | 45,298 | | | $ | 46,279 | |
Net income (loss) | | $ | 201.9 | | | $ | 414.4 | | | $ | 384.1 | | | $ | 386.8 | | | $ | 322.7 | |
Net charge-off rate | | | 4.93 | % | | | 4.68 | % | | | 5.19 | % | | | 5.41 | % | | | 6.16 | % |
Delinquency Rate (30+ days) | | | 3.97 | % | | | 4.14 | % | | | 3.95 | % | | | 3.99 | % | | | 4.60 | % |
Auto Finance: | | | | | | | | | | | | | | | | | | | | |
Loans receivable | | $ | 9,997 | | | $ | 9,734 | | | $ | 9,383 | | | $ | 8,834 | | | $ | 8,467 | |
Net income (loss) | | $ | 25.1 | | | $ | 55.3 | | | $ | 52.7 | | | $ | 30.7 | | | $ | 34.4 | |
Net charge-off rate | | | 3.87 | % | | | 2.63 | % | | | 2.53 | % | | | 4.13 | % | | | 4.30 | % |
Delinquency Rate (30+ days) | | | 5.50 | % | | | 5.54 | % | | | 5.59 | % | | | 5.44 | % | | | 7.55 | % |
Global Financial Services: | | | | | | | | | | | | | | | | | | | | |
Loans receivable | | $ | 21,240 | | | $ | 19,615 | | | $ | 18,723 | | | $ | 17,643 | | | $ | 16,508 | |
Net income (loss) | | $ | 29.2 | | | $ | 86.8 | | | $ | 46.1 | | | $ | 50.9 | | | $ | 3.3 | |
Net charge-off rate | | | 3.30 | % | | | 3.26 | % | | | 3.43 | % | | | 3.60 | % | | | 3.69 | % |
Delinquency Rate (30+ days) | | | 2.81 | % | | | 2.65 | % | | | 2.50 | % | | | 2.63 | % | | | 2.70 | % |
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| (1) | The information in this statistical summary reflects the adjustment to add back the effect of securitization transactions qualifying as sales under generally accepted accounting principles. See accompanying schedule—“Reconciliation to GAAP Financial Measures”. |
CAPITAL ONE FINANCIAL CORPORATION
Reconciliation to GAAP Financial Measures
For the Three Months Ended December 31, 2004
(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, servicing fees, finance charges, and other fees, net of charge-offs, and interest paid to investors of securitizations are recognized as servicing and securitizations income on the “reported” income statement.
The Company’s “managed” consolidated financial statements reflect adjustments made related to 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 servicing and securitizations income generated from the securitized portfolio and distributes the revenue and expense 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.
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| | | Total Reported
| | Adjustments(1)
| | | Total Managed(2)
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Income Statement Measures | | | | | | | | | | |
Net interest income | | $ | 784,564 | | $ | 917,263 | | | $ | 1,701,827 |
Non-interest income | | $ | 1,521,575 | | $ | (422,596 | ) | | $ | 1,098,979 |
Total revenue | | $ | 2,306,139 | | $ | 494,667 | | | $ | 2,800,806 |
Provision for loan losses | | $ | 467,133 | | $ | 494,667 | | | $ | 961,800 |
Net charge-offs | | $ | 345,073 | | $ | 494,667 | | | $ | 839,740 |
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Balance Sheet Measures | | | | | | | | | | |
Consumer loans | | $ | 38,215,591 | | $ | 41,645,708 | | | $ | 79,861,299 |
Total assets | | $ | 53,747,255 | | $ | 41,044,776 | | | $ | 94,792,031 |
Average consumer loans | | $ | 36,096,481 | | $ | 40,833,492 | | | $ | 76,929,973 |
Average earning assets | | $ | 49,500,348 | | $ | 38,960,722 | | | $ | 88,461,070 |
Average total assets | | $ | 53,338,621 | | $ | 40,235,616 | | | $ | 93,574,237 |
Delinquencies | | $ | 1,472,194 | | $ | 1,581,884 | | | $ | 3,054,078 |
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| (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, “Accounting for Accrued Interest Receivable Related to Securitized and Sold Receivables under FASB Statement 140,Accounting for Transfers and Servicing of Financial Assets and Extinguishments of Liabilities”, 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
(in thousands)(unaudited)
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| | | December 31
2004
| | | September 30
2004
| | | December 31
2003
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Assets: | | | | | | | | | | | | |
Cash and due from banks | | $ | 327,517 | | | $ | 454,843 | | | $ | 382,212 | |
Federal funds sold and resale agreements | | | 773,695 | | | | 449,700 | | | | 1,010,319 | |
Interest-bearing deposits at other banks | | | 309,999 | | | | 538,324 | | | | 587,751 | |
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Cash and cash equivalents | | | 1,411,211 | | | | 1,442,867 | | | | 1,980,282 | |
Securities available for sale | | | 9,300,454 | | | | 9,519,089 | | | | 5,866,628 | |
Consumer loans | | | 38,215,591 | | | | 35,160,635 | | | | 32,850,269 | |
Less: Allowance for loan losses | | | (1,505,000 | ) | | | (1,395,000 | ) | | | (1,595,000 | ) |
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Net loans | | | 36,710,591 | | | | 33,765,635 | | | | 31,255,269 | |
Accounts receivable from securitizations | | | 4,081,271 | | | | 4,955,739 | | | | 4,748,962 | |
Premises and equipment, net | | | 817,704 | | | | 812,724 | | | | 902,600 | |
Interest receivable | | | 252,857 | | | | 232,808 | | | | 214,295 | |
Other | | | 1,173,167 | | | | 1,230,693 | | | | 1,315,670 | |
| | |
|
|
| |
|
|
| |
|
|
|
Total assets | | $ | 53,747,255 | | | $ | 51,959,555 | | | $ | 46,283,706 | |
| | |
|
|
| |
|
|
| |
|
|
|
| | | |
Liabilities: | | | | | | | | | | | | |
Interest-bearing deposits | | $ | 25,636,802 | | | $ | 25,354,323 | | | $ | 22,416,332 | |
Senior and subordinated notes | | | 6,874,790 | | | | 6,968,182 | | | | 7,016,020 | |
Other borrowings | | | 9,637,019 | | | | 8,490,631 | | | | 7,796,613 | |
Interest payable | | | 237,227 | | | | 250,227 | | | | 256,015 | |
Other | | | 2,973,228 | | | | 2,966,132 | | | | 2,746,915 | |
| | |
|
|
| |
|
|
| |
|
|
|
Total liabilities | | | 45,359,066 | | | | 44,029,495 | | | | 40,231,895 | |
| | | |
Stockholders’ Equity: | | | | | | | | | | | | |
Common stock | | | 2,484 | | | | 2,440 | | | | 2,364 | |
Paid-in capital, net | | | 2,711,327 | | | | 2,463,629 | | | | 1,937,302 | |
Retained earnings and cumulative other comprehensive income | | | 5,741,131 | | | | 5,513,694 | | | | 4,161,666 | |
Less: Treasury stock, at cost | | | (66,753 | ) | | | (49,703 | ) | | | (49,521 | ) |
| | |
|
|
| |
|
|
| |
|
|
|
Total stockholders’ equity | | | 8,388,189 | | | | 7,930,060 | | | | 6,051,811 | |
| | |
|
|
| |
|
|
| |
|
|
|
Total liabilities and stockholders’ equity | | $ | 53,747,255 | | | $ | 51,959,555 | | | $ | 46,283,706 | |
| | |
|
|
| |
|
|
| |
|
|
|
CAPITAL ONE FINANCIAL CORPORATION
Consolidated Statements of Income
(in thousands, except per share data)(unaudited)
| | | | | | | | | | | | | | | |
| | | Three Months Ended
| | Year Ended
|
| | | December 31
2004
| | September 30 2004
| | December 31
2003
| | December 31
2004
| | December 31
2003
|
Interest Income: | | | | | | | | | | | | | | | |
Consumer loans, including past-due fees | | $ | 1,097,041 | | $ | 1,083,286 | | $ | 969,571 | | $ | 4,234,420 | | $ | 3,932,295 |
Securities available for sale | | | 88,085 | | | 84,492 | | | 52,328 | | | 312,374 | | | 192,594 |
Other | | | 64,204 | | | 60,635 | | | 65,884 | | | 247,626 | | | 242,765 |
| | |
|
| |
|
| |
|
| |
|
| |
|
|
Total interest income | | | 1,249,330 | | | 1,228,413 | | | 1,087,783 | | | 4,794,420 | | | 4,367,654 |
| | | | | |
Interest Expense: | | | | | | | | | | | | | | | |
Deposits | | | 267,706 | | | 257,349 | | | 237,624 | | | 1,009,545 | | | 891,650 |
Senior and subordinated notes | | | 116,419 | | | 121,166 | | | 117,791 | | | 486,812 | | | 423,826 |
Other borrowings | | | 80,641 | | | 74,523 | | | 68,267 | | | 295,085 | | | 267,089 |
| | |
|
| |
|
| |
|
| |
|
| |
|
|
Total interest expense | | | 464,766 | | | 453,038 | | | 423,682 | | | 1,791,442 | | | 1,582,565 |
| | |
|
| |
|
| |
|
| |
|
| |
|
|
Net interest income | | | 784,564 | | | 775,375 | | | 664,101 | | | 3,002,978 | | | 2,785,089 |
Provision for loan losses | | | 467,133 | | | 267,795 | | | 390,405 | | | 1,220,852 | | | 1,517,497 |
| | |
|
| |
|
| |
|
| |
|
| |
|
|
Net interest income after provision for loan losses | | | 317,431 | | | 507,580 | | | 273,696 | | | 1,782,126 | | | 1,267,592 |
| | | | | |
Non-Interest Income: | | | | | | | | | | | | | | | |
Servicing and securitizations | | | 915,511 | | | 942,587 | | | 918,762 | | | 3,643,808 | | | 3,211,662 |
Service charges and other customer-related fees | | | 374,048 | | | 385,648 | | | 380,925 | | | 1,482,658 | | | 1,630,185 |
Interchange | | | 135,843 | | | 117,043 | | | 106,414 | | | 475,810 | | | 376,785 |
Other | | | 96,173 | | | 94,106 | | | 31,390 | | | 297,881 | | | 197,292 |
| | |
|
| |
|
| |
|
| |
|
| |
|
|
Total non-interest income | | | 1,521,575 | | | 1,539,384 | | | 1,437,491 | | | 5,900,157 | | | 5,415,924 |
| | | | | |
Non-Interest Expense: | | | | | | | | | | | | | | | |
Salaries and associate benefits | | | 382,646 | | | 415,988 | | | 408,884 | | | 1,642,721 | | | 1,570,415 |
Marketing | | | 511,142 | | | 317,653 | | | 290,145 | | | 1,337,780 | | | 1,118,422 |
Communications and data processing | | | 137,867 | | | 112,191 | | | 116,217 | | | 475,355 | | | 448,110 |
Supplies and equipment | | | 92,827 | | | 94,190 | | | 83,804 | | | 349,920 | | | 344,049 |
Occupancy | | | 55,994 | | | 41,407 | | | 51,645 | | | 206,614 | | | 185,179 |
Other | | | 376,051 | | | 330,555 | | | 338,777 | | | 1,309,829 | | | 1,190,548 |
| | |
|
| |
|
| |
|
| |
|
| |
|
|
Total non-interest expense | | | 1,556,527 | | | 1,311,984 | | | 1,289,472 | | | 5,322,219 | | | 4,856,723 |
| | |
|
| |
|
| |
|
| |
|
| |
|
|
Income before income taxes and cumulative effect of accounting change | | | 282,479 | | | 734,980 | | | 421,715 | | | 2,360,064 | | | 1,826,793 |
Income taxes | | | 87,351 | | | 244,819 | | | 156,034 | | | 816,582 | | | 675,914 |
| | |
|
| |
|
| |
|
| |
|
| |
|
|
Income before cumulative effect of accounting change | | | 195,128 | | | 490,161 | | | 265,681 | | | 1,543,482 | | | 1,150,879 |
Cumulative effect of accounting change, net of taxes of $8,832 | | | — | | | — | | | | | | — | | | 15,037 |
| | |
|
| |
|
| |
|
| |
|
| |
|
|
Net income | | $ | 195,128 | | $ | 490,161 | | $ | 265,681 | | $ | 1,543,482 | | $ | 1,135,842 |
| | |
|
| |
|
| |
|
| |
|
| |
|
|
| | | | | |
Basic earnings per share before cumulative effect of accounting change | | $ | 0.82 | | $ | 2.07 | | $ | 1.16 | | $ | 6.55 | | $ | 5.12 |
| | |
|
| |
|
| |
|
| |
|
| |
|
|
Basic earnings per share after cumulative effect of accounting change | | $ | 0.82 | | $ | 2.07 | | $ | 1.16 | | $ | 6.55 | | $ | 5.05 |
| | |
|
| |
|
| |
|
| |
|
| |
|
|
Diluted earnings per share before cumulative effect of accounting change | | $ | 0.77 | | $ | 1.97 | | $ | 1.11 | | $ | 6.21 | | $ | 4.92 |
| | |
|
| |
|
| |
|
| |
|
| |
|
|
Diluted earnings per share after cumulative effect of accounting change | | $ | 0.77 | | $ | 1.97 | | $ | 1.11 | | $ | 6.21 | | $ | 4.85 |
| | |
|
| |
|
| |
|
| |
|
| |
|
|
Dividends paid per share | | $ | 0.03 | | $ | 0.03 | | $ | 0.03 | | $ | 0.11 | | $ | 0.11 |
| | |
|
| |
|
| |
|
| |
|
| |
|
|
CAPITAL ONE FINANCIAL CORPORATION
Statements of Average Balances, Income and Expense, Yields and Rates
(dollars in thousands)(unaudited)
| | | | | | | | | | | | | | | | | | | | | | | | | | | |
| Reported | | Quarter Ended 12/31/04
| | | Quarter Ended 9/30/04
| | | Quarter Ended 12/31/03
| |
| | | Average
Balance
| | Income/
Expense
| | Yield/
Rate
| | | Average
Balance
| | Income/
Expense
| | Yield/
Rate
| | | Average
Balance
| | Income/
Expense
| | Yield/
Rate
| |
Earning assets: | | | | | | | | | | | | | | | | | | | | | | | | | | | |
Consumer loans | | $ | 36,096,481 | | $ | 1,097,041 | | 12.16 | % | | $ | 34,772,489 | | $ | 1,083,286 | | 12.46 | % | | $ | 31,297,123 | | $ | 969,571 | | 12.39 | % |
Securities available for sale | | | 9,741,355 | | | 88,085 | | 3.62 | | | | 9,372,713 | | | 84,492 | | 3.61 | | | | 5,816,001 | | | 52,328 | | 3.60 | |
Other | | | 3,662,512 | | | 64,204 | | 7.01 | | | | 3,122,208 | | | 60,635 | | 7.77 | | | | 3,679,088 | | | 65,884 | | 7.16 | |
| | |
|
| |
|
| |
|
| |
|
| |
|
| |
|
| |
|
| |
|
| |
|
|
Total earning assets | | $ | 49,500,348 | | $ | 1,249,330 | | 10.10 | % | | $ | 47,267,410 | | $ | 1,228,413 | | 10.40 | % | | $ | 40,792,212 | | $ | 1,087,783 | | 10.67 | % |
| | |
|
| |
|
| | | | |
|
| |
|
| | | | |
|
| |
|
| | | |
| | | | | | | | | |
Interest-bearing liabilities: | | | | | | | | | | | | | | | | | | | | | | | | | | | |
Deposits | | $ | 25,580,044 | | $ | 267,706 | | 4.19 | % | | $ | 24,713,924 | | $ | 257,349 | | 4.17 | % | | $ | 21,604,968 | | $ | 237,624 | | 4.40 | % |
Senior and subordinated notes | | | 6,946,109 | | | 116,419 | | 6.70 | | | | 7,218,916 | | | 121,166 | | 6.71 | | | | 6,734,569 | | | 117,791 | | 7.00 | |
Other borrowings | | | 9,076,531 | | | 80,641 | | 3.55 | | | | 8,674,298 | | | 74,523 | | 3.44 | | | | 7,661,016 | | | 68,267 | | 3.56 | |
| | |
|
| |
|
| |
|
| |
|
| |
|
| |
|
| |
|
| |
|
| |
|
|
Total interest-bearing liabilities | | $ | 41,602,684 | | $ | 464,766 | | 4.47 | % | | $ | 40,607,138 | | $ | 453,038 | | 4.46 | % | | $ | 36,000,553 | | $ | 423,682 | | 4.71 | % |
| | |
|
| |
|
| |
|
| |
|
| |
|
| |
|
| |
|
| |
|
| |
|
|
Net interest spread | | | | | | | | 5.63 | % | | | | | | | | 5.94 | % | | | | | | | | 5.96 | % |
| | | | | | | | |
|
| | | | | | | |
|
| | | | | | | |
|
|
Interest income to average earning assets | | | | | 10.10 | % | | | | | | | | 10.40 | % | | | | | | | | 10.67 | % |
Interest expense to average earning assets | | | | | 3.76 | | | | | | | | | 3.84 | | | | | | | | | 4.16 | |
| | | | | | | | |
|
| | | | | | | |
|
| | | | | | | |
|
|
Net interest margin | | | | | 6.34 | % | | | | | | | | 6.56 | % | | | | | | | | 6.51 | % |
| | | | | | | | |
|
| | | | | | | |
|
| | | | | | | |
|
|
CAPITAL ONE FINANCIAL CORPORATION
Statements of Average Balances, Income and Expense, Yields and Rates
(dollars in thousands)(unaudited)
| | | | | | | | | | | | | | | | | | | | | | | | | | | |
| Managed (1) | | Quarter Ended 12/31/04
| | | Quarter Ended 9/30/04
| | | Quarter Ended 12/31/03
| |
| | | Average
Balance
| | Income/
Expense
| | Yield/
Rate
| | | Average
Balance
| | Income/
Expense
| | Yield/
Rate
| | | Average
Balance
| | Income/
Expense
| | Yield/
Rate
| |
Earning assets: | | | | | | | | | | | | | | | | | | | | | | | | | | | |
Consumer loans | | $ | 76,929,973 | | $ | 2,476,365 | | 12.88 | % | | $ | 74,398,301 | | $ | 2,419,685 | | 13.01 | % | | $ | 68,678,877 | | $ | 2,295,802 | | 13.37 | % |
Securities available for sale | | | 9,741,355 | | | 88,085 | | 3.62 | | | | 9,372,713 | | | 84,492 | | 3.61 | | | | 5,816,001 | | | 52,328 | | 3.60 | |
Other | | | 1,789,742 | | | 16,940 | | 3.79 | | | | 1,273,583 | | | 12,587 | | 3.95 | | | | 1,782,263 | | | 11,326 | | 2.54 | |
| | |
|
| |
|
| |
|
| |
|
| |
|
| |
|
| |
|
| |
|
| |
|
|
Total earning assets | | $ | 88,461,070 | | $ | 2,581,390 | | 11.67 | % | | $ | 85,044,597 | | $ | 2,516,764 | | 11.84 | % | | $ | 76,277,141 | | $ | 2,359,456 | | 12.37 | % |
| | |
|
| |
|
| | | | |
|
| |
|
| | | | |
|
| |
|
| | | |
| | | | | | | | | |
Interest-bearing liabilities: | | | | | | | | | | | | | | | | | | | | | | | | | | | |
Deposits | | $ | 25,580,044 | | $ | 267,706 | | 4.19 | % | | $ | 24,713,924 | | $ | 257,349 | | 4.17 | % | | $ | 21,604,968 | | $ | 237,624 | | 4.40 | % |
Senior and subordinated notes | | | 6,946,109 | | | 116,419 | | 6.70 | | | | 7,218,916 | | | 121,166 | | 6.71 | | | | 6,734,569 | | | 117,791 | | 7.00 | |
Other borrowings | | | 9,076,531 | | | 80,641 | | 3.55 | | | | 8,674,298 | | | 74,523 | | 3.44 | | | | 7,661,016 | | | 68,267 | | 3.56 | |
Securitization liability | | | 40,291,395 | | | 414,797 | | 4.12 | | | | 39,101,228 | | | 393,359 | | 4.02 | | | | 36,766,829 | | | 364,092 | | 3.96 | |
| | |
|
| |
|
| |
|
| |
|
| |
|
| |
|
| |
|
| |
|
| |
|
|
Total interest-bearing liabilities | | $ | 81,894,079 | | $ | 879,563 | | 4.30 | % | | $ | 79,708,366 | | $ | 846,397 | | 4.25 | % | | $ | 72,767,382 | | $ | 787,774 | | 4.33 | % |
| | |
|
| |
|
| |
|
| |
|
| |
|
| |
|
| |
|
| |
|
| |
|
|
| | | | | | | | | |
Net interest spread | | | | | | | | 7.37 | % | | | | | | | | 7.59 | % | | | | | | | | 8.04 | % |
| | | | | | | | |
|
| | | | | | | |
|
| | | | | | | |
|
|
Interest income to average earning assets | | | | | | | | 11.67 | % | | | | | | | | 11.84 | % | | | | | | | | 12.37 | % |
Interest expense to average earning assets | | | | | | | | 3.97 | | | | | | | | | 3.98 | | | | | | | | | 4.13 | |
| | | | | | | | |
|
| | | | | | | |
|
| | | | | | | |
|
|
Net interest margin | | | | | | | | 7.70 | % | | | | | | | | 7.86 | % | | | | | | | | 8.24 | % |
| | | | | | | | |
|
| | | | | | | |
|
| | | | | | | |
|
|
| (1) | The information in this table reflects the adjustment to add back the effect of securitization transactions qualifying as sales under generally accepted accounting principles. See accompanying schedule - “Reconciliation to GAAP Financial Measures.” |
1680 Capital One Drive McLean, VA 22102-3491
FOR IMMEDIATE RELEASE: January 19, 2005
| | | | |
| Contacts: | | Mike Rowen | | Tatiana Stead |
| | | V.P., Investor Relations | | Director, Corporate Media |
| | | (703) 720-3203 | | (703) 720-2352 |
| | |
| | | | | Capital One Reports Earnings for 2004 28% EPS Growth Year Over Year |
McLean, Va. (January 19, 2005) – Capital One Financial Corporation (NYSE: COF) today announced 28 percent earnings per share growth for 2004. The company reaffirmed its earnings per share guidance for 2005 to be between $6.60 and $7.00 per share (fully diluted).
Earnings were $1.5 billion, or $6.21 per share (fully diluted), for the year compared with $1.1 billion, or $4.85 per share, in 2003. Earnings for the fourth quarter of 2004 were $195.1 million, or $.77 per share (fully diluted), compared with $265.7 million, or $1.11 per share, for the fourth quarter of 2003, and $490.2 million, or $1.97 per share, in the previous quarter. Higher marketing and provision expenses in the fourth quarter accounted for the lower earnings compared to the previous quarter and fourth quarter of 2003.
“Capital One generated strong earnings and loan growth again in 2004, as it has each year since its initial public offering ten years ago,” said Richard D. Fairbank, Capital One’s Chairman and Chief Executive Officer. “The company is well positioned for continued success in 2005 in both our US credit card and our growing and profitable diversification businesses.”
During the fourth quarter, managed loans grew $4.4 billion from $75.5 billion to $79.9 billion. Annual growth in managed loans was $8.6 billion, or 12 percent, from December 31, 2003. The company continues to expect that managed loans will grow at a rate of between 12 and 15 percent during 2005.
The managed charge-off rate increased to 4.37 percent in the fourth quarter of 2004 from 4.05 percent in the previous quarter, but decreased from 5.32 percent in the fourth quarter of 2003. The increase in the managed charge-off rate in the fourth quarter of 2004 included a one-time 10 basis point effect from a change in our charge-off recognition policy for auto loans in bankruptcy. The company continues to expect its quarterly managed charge-off rate to stay between 4.0 and 4.5 percent in 2005, with seasonal variations. Additionally, the company increased its allowance for loan losses by $110 million in the fourth quarter of 2004, largely driven by the growth in reported loans. The company expects a seasonal reduction in its allowance for loan losses in the first quarter of 2005, and a likely increase for full year 2005.
-more-
The managed delinquency rate (30+ days) decreased to 3.82 percent as of December 31, 2004 from 3.90 percent as of the end of the previous quarter. The managed delinquency rate as of December 31, 2003 was 4.46 percent. Capital One’s managed revenue margin decreased to 12.66 percent in the fourth quarter of 2004 from 13.03 percent in the previous quarter. The company’s managed revenue margin was 13.89 percent in the fourth quarter of 2003.
“Return on managed assets for 2004 increased to 1.73 percent from 1.52 percent in 2003,” said Gary L. Perlin, Capital One’s Chief Financial Officer. “Although we expect to see a modest decline in our revenue margin in 2005 from our ongoing diversification and bias towards lower loss assets, we expect to continue to improve our operating efficiency and thus maintain a return on managed assets of between 1.7 and 1.8 percent in 2005, with some quarterly variability.”
Fourth quarter marketing expenses increased $193.4 million to $511.1 million from $317.7 million in the previous quarter, largely due to the launch of several new programs. Marketing expenses were $290.1 million in the fourth quarter of 2003. Marketing expenses for 2004 were $1.3 billion, a 20 percent increase over the $1.1 billion in 2003. The company expects annual marketing spend for 2005 to be similar to 2004.
Annualized operating expenses as a percentage of average managed loans increased to 5.44 percent in the fourth quarter of 2004, from 5.35 percent in the previous quarter and decreased from 5.82 percent in the fourth quarter of 2003. Included in fourth quarter 2004 operating expenses were charges totaling $42.1 million for a combination of employee termination benefits and continued facility consolidations. The company expects about $50 million in additional restructuring charges in 2005 related to programs initiated in 2004.
In the fourth quarter of 2004, the company completed the sale of its French loan portfolio and recorded a gain of $41.1 million, which is included in non-interest income. As announced during the second half of 2004, the company signed definitive agreements to acquire HFS Group, Onyx Acceptance Corporation, and eSmartloan. During the first quarter of 2005, Capital One completed the HFS and Onyx transactions, as well as the acquisition of InsLogic, a small insurance brokerage firm. The company expects to close the eSmartloan acquisition later in the first quarter of 2005.
The company generates earnings from its managed loan portfolio, which includes both on-balance sheet loans and securitized (off-balance sheet) loans. For this reason, the company believes 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 (GAAP). Please see the schedule titled “Reconciliation to GAAP Financial Measures” attached to this release for more information.
-more-
The company cautions that its current expectations in this release, in the presentation slides available on the company’s website and on its Form 8-K dated January 19, 2005 for 2005 earnings, charge-off rates, revenue margins, return on assets, allowance for loan losses, loan growth rates, marketing, the composition of loan growth, restructuring charges, and tax rate are forward-looking statements and actual results could differ materially from current expectations due to a number of factors, including: continued intense competition from numerous providers of products and services which compete with our businesses; changes in our aggregate accounts and balances, and the growth rate and composition thereof; the company’s ability to continue to diversify its assets; the company’s ability to access the capital markets at attractive rates and terms to fund its operations and future growth; changes in the reputation of the credit card industry and/or the company with respect to practices or products; the success of the company’s marketing efforts; the company’s ability to execute effective tax planning strategies; the company’s ability to execute on its strategic and operating plans; 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 report 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 September 30, 2004.
About Capital One
Headquartered in McLean, Virginia, Capital One Financial Corporation (www.capitalone.com) is a bank holding company whose principal subsidiaries, Capital One Bank and Capital One, F.S.B., offer consumer lending products and Capital One Auto Finance, Inc., offers automobile and other motor vehicle financing products. Capital One’s subsidiaries collectively had 48.6 million accounts and $79.9 billion in managed loans outstanding as of December 31, 2004. 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.
###
NOTE: Fourth quarter 2004 financial results, SEC Filings, and fourth quarter earnings conference call slides are accessible on Capital One’s home page (www.capitalone.com). Choose “Investors” on the bottom right corner of the home page to view and download the earnings press release, slides, and other financial information. Additionally, a webcast of today’s 5:00pm (EST) earnings conference call is accessible through the same link.
