 Investor Conference – Investor Conference – Credit Update Credit Update Peter Schnall, Chief Risk Officer |
 3 November 2007 Capital One Credit Outlook Capital One Credit Outlook • Our $4.9 billion outlook for 2008 credit losses accounted for: Full year effects of credit normalization Continued seasoning of Auto Dealer Prime portfolio Continued sharp degradation in our Alt-A, Greenpoint home equity book Continued increase in bankruptcies Expected changes in business mix Effects of 25 day grace period implementation Other increases in delinquency that we assumed were temporary • We assumed that there would be $175 million of “extra” charge- offs in Q1 2008 as delinquencies that we assumed were temporary rolled through the delinquency buckets |
 4 November 2007 Adding a range to our outlook: We expect 2008 credit losses to Adding a range to our outlook: We expect 2008 credit losses to range between $4.9 billion to the mid $5 billions range between $4.9 billion to the mid $5 billions • Our earnings call outlook accounted for: Full year effects of credit normalization Continued seasoning of Auto Dealer Prime portfolio Continued sharp degradation in our Alt-A, Greenpoint home equity book Continued increase in bankruptcies Expected changes in business mix Effects of 25 day grace period implementation Other increases in delinquency that we assumed were temporary • Our range allows for card delinquencies to remain partially elevated • Our range assumes the economy will continue to perform in 2008 similarly to how it is performing today and allows room for significant continued degradation in the housing market |