Capital One Financial (COF) 10-Q 7 May 10 2010 Q1 Quarterly report Financial data

Document and Entity Information

Document and Entity Information
	3 Months Ended Mar. 31, 2010	Apr. 30, 2010
Document Type	10-Q
Amendment Flag	false
Document Period End Date	2010-03-31
Trading Symbol	COF
Entity Registrant Name	CAPITAL ONE FINANCIAL CORP
Entity Central Index Key	0000927628
Current Fiscal Year End Date	--12-31
Entity Filer Category	Large Accelerated Filer
Entity Common Stock, Shares Outstanding		456,534,936
Document Fiscal Year Focus	2,010
Document Fiscal Period Focus	Q1

CONSOLIDATED BALANCE SHEETS

CONSOLIDATED BALANCE SHEETS (USD $)
In Thousands	Mar. 31, 2010	Dec. 31, 2009
Assets:
Cash and due from banks	$2,928,702	$3,100,110
Federal funds sold and resale agreements	477,108	541,570
Interest-bearing deposits at other banks	4,092,556	5,042,944
Cash and cash equivalents	7,498,366	8,684,624
Restricted cash for securitization investors	3,286,002	501,113
Securities available for sale	38,251,017	38,829,562
Securities held to maturity	0	80,577
Loans held for sale	247,445	268,307
Loans held for investment	72,591,272	75,097,329
Restricted loans for securitization investors	57,523,249	15,521,670
Less: Allowance for loan and lease losses	(7,751,745)	(4,127,395)
Net loans held for investment	122,362,776	86,491,604
Accounts receivable from securitizations	205,960	7,128,484
Premises and equipment, net	2,735,192	2,735,623
Interest receivable	1,134,751	936,146
Goodwill	13,589,339	13,596,368
Other	11,396,739	10,393,955
Total assets	200,707,587	169,646,363
Liabilities:
Non-interest-bearing deposits	13,773,082	13,438,659
Interest-bearing deposits	104,013,477	102,370,437
Total deposits	117,786,559	115,809,096
Securitized debt obligations	37,829,527	3,953,492
Senior and subordinated notes	9,134,292	9,045,470
Other borrowings	5,708,279	8,014,969
Interest payable	521,875	509,105
Other	5,352,673	5,724,821
Total liabilities	176,333,205	143,056,953
Stockholders' Equity:
Common stock, par value $.01 per share; authorized 1,000,000,000 shares; 504,123,393 and 502,394,396 issued as of March 31, 2010 and December 31, 2009 respectively	5,041	5,024
Paid-in capital, net	18,990,863	18,954,823
Retained earnings	8,417,819	10,727,368
Accumulated other comprehensive income	158,916	82,654
Less: Treasury stock, at cost; 47,702,956 and 47,224,200 shares as of March 31, 2010 and December 31, 2009 respectively	(3,198,257)	(3,180,459)
Total stockholders' equity	24,374,382	26,589,410
Total liabilities and stockholders' equity	$200,707,587	$169,646,363

CONSOLIDATED BALANCE SHEETS (Pa

CONSOLIDATED BALANCE SHEETS (Parenthetical) (USD $)
	Mar. 31, 2010	Dec. 31, 2009
Common stock, par value	0.01	0.01
Common stock, authorized	1,000,000,000	1,000,000,000
Common stock, issued	504,123,393	502,394,396
Treasury stock, shares	47,702,956	47,224,200

CONSOLIDATED STATEMENTS OF INCO

CONSOLIDATED STATEMENTS OF INCOME (USD $)
In Thousands, except Per Share data	3 Months Ended Mar. 31, 2010		3 Months Ended Mar. 31, 2009
Interest Income:
Loans held for investment, including past-due fees	$3,657,735		$2,191,618
Investment securities	348,715		395,274
Other	23,379		63,117
Total interest income	4,029,829		2,650,009
Interest Expense:
Deposits	398,730		627,392
Securitized debt obligations	241,735		90,733
Senior and subordinated notes	68,224		58,044
Other borrowings	92,987		80,852
Total interest expense	801,676		857,021
Net interest income	3,228,153		1,792,988
Provision for loan and lease losses	1,478,200		1,279,137
Net interest income after provision for loan and lease losses	1,749,953		513,851
Non-Interest Income:
Servicing and securitizations	(36,368)		453,144
Service charges and other customer-related fees	584,973		506,129
Interchange	311,407		140,090
Net other-than-temporary impairment losses recognized in earnings	(31,256)	[1]	(363)	[1]
Other	232,702		(9,156)
Total non-interest income	1,061,458		1,089,844
Non-Interest Expense:
Salaries and associate benefits	646,436		554,431
Marketing	180,459		162,712
Communications and data processing	169,327		199,104
Supplies and equipment	123,624		118,900
Occupancy	119,779		100,185
Restructuring expense	0		17,627	[2]
Other	607,976		592,330
Total non-interest expense	1,847,601		1,745,289
Income (loss) from continuing operations before income taxes	963,810		(141,594)
Income tax provision (benefit)	244,359		(58,490)
Income (loss) from continuing operations, net of tax	719,451		(83,104)
Loss from discontinued operations, net of tax	(83,188)		(24,958)
Net income (loss)	636,263		(108,062)
Net income (loss) available to common shareholders	$636,263		($172,252)
Basic earnings per common share
Income (loss) from continuing operations	1.59		-0.38
Loss from discontinued operations	-0.18		-0.06
Net income (loss)	1.41		-0.44
Diluted earnings per common share
Income (loss) from continuing operations	1.58		-0.38
Loss from discontinued operations	-0.18		-0.06
Net income (loss)	1.4		-0.44
Dividends paid per common share	0.05		0.38
[1]For the three months ended March 31, 2010 and March 31, 2009, the Company recorded other-than-temporary impairment losses of $31.3 million and $0.4 million, respectively. Additional unrealized losses of $149.9 million, on these securities were recognized in other comprehensive income as a component of stockholders' equity at March 31, 2010.
[2]The Company completed its 2007 restructuring initiative during 2009.

1_CONSOLIDATED STATEMENTS OF IN

CONSOLIDATED STATEMENTS OF INCOME (Parenthetical) (USD $)
In Millions	3 Months Ended Mar. 31, 2010	3 Months Ended Mar. 31, 2009
Additional unrealized losses on securities recognized in other comprehensive income as a component of stockholders' equity	149.9	$0

CONSOLIDATED STATEMENTS OF CHAN

CONSOLIDATED STATEMENTS OF CHANGES IN STOCKHOLDERS' EQUITY (USD $)
In Thousands, except Share data	Common Stock	Preferred Stock	Paid-In Capital, Net	Retained Earnings	Accumulated Other Comprehensive Income (Loss)	Treasury Stock	Total
Balance (in shares) at Dec. 31, 2008	438,434,235
Balance at Dec. 31, 2008	$4,384	$3,096,466	$17,278,102	$10,621,164	($1,221,796)	($3,165,887)	$26,612,433
Comprehensive income:
Net income				(108,062)			(108,062)
Other comprehensive income (loss), net of income tax:
Unrealized gains on securities, net of income taxes					373,723		373,723
Other-than-temporary impairment not recognized in earnings on securities, net of income taxes					(231)		(231)
Defined benefit pension plans, net of net income tax benefit					(293)		(293)
Foreign currency translation adjustments					(38,993)		(38,993)
Unrealized gains in cash flow hedging instruments, net of income taxes					35,543		35,543
Other comprehensive income					369,749		369,749
Comprehensive income							261,687
Cash dividends-Common stock				(148,411)			(148,411)
Cash dividends-Preferred stock 5% per annum		(494)		(44,440)			(44,934)
Purchase of treasury stock						(2,955)	(2,955)
Issuances of common stock and restricted stock, net of forfeitures	15		7,981				7,996
Issuances of common stock and restricted stock, net of forfeitures (in shares)	1,543,405
Exercise of stock options and tax benefits of exercises and restricted stock vesting			(1,599)				(1,599)
Exercise of stock options and tax benefits of exercises and restricted stock vesting (in shares)	1,900
Accretion of preferred stock discount		19,750		(19,750)			0
Compensation expense for restricted stock awards and stock options			31,670				31,670
Issuance of common stock for acquisition	26		30,830				30,856
Issuance of common stock for acquisition (in shares)	2,560,601
Allocation of ESOP shares			1,233				1,233
Balance at Mar. 31, 2009	4,425	3,115,722	17,348,217	10,300,501	(852,047)	(3,168,842)	26,747,976
Balance (in shares) at Mar. 31, 2009	442,540,141
Balance (in shares) at Dec. 31, 2009	502,394,396
Balance at Dec. 31, 2009	5,024	0	18,954,823	10,727,368	82,654	(3,180,459)	26,589,410
Cumulative effect from adoption of new consolidation accounting standards				(2,922,988)	(15,924)		(2,938,912)
Comprehensive income:
Net income				636,263			636,263
Other comprehensive income (loss), net of income tax:
Unrealized gains on securities, net of income taxes					118,021		118,021
Other-than-temporary impairment not recognized in earnings on securities, net of income taxes					16,949		16,949
Defined benefit pension plans, net of net income tax benefit					(358)		(358)
Foreign currency translation adjustments					(56,834)		(56,834)
Unrealized gains in cash flow hedging instruments, net of income taxes					14,408		14,408
Other comprehensive income					92,186		92,186
Comprehensive income							728,449
Cash dividends-Common stock				(22,824)			(22,824)
Purchase of treasury stock						(17,798)	(17,798)
Issuances of common stock and restricted stock, net of forfeitures	15		7,153				7,168
Issuances of common stock and restricted stock, net of forfeitures (in shares)	1,498,243
Exercise of stock options and tax benefits of exercises and restricted stock vesting	2		(491)				(489)
Exercise of stock options and tax benefits of exercises and restricted stock vesting (in shares)	230,754
Compensation expense for restricted stock awards and stock options			29,378				29,378
Balance at Mar. 31, 2010	$5,041	$0	$18,990,863	$8,417,819	$158,916	($3,198,257)	$24,374,382
Balance (in shares) at Mar. 31, 2010	504,123,393

2_CONSOLIDATED STATEMENTS OF CH

CONSOLIDATED STATEMENTS OF CHANGES IN STOCKHOLDERS' EQUITY (Parenthetical) (USD $)
In Thousands	3 Months Ended Mar. 31, 2010	3 Months Ended Mar. 31, 2009
Unrealized gains (losses) on securities, income tax (benefit)	$62,908	$175,730
Other-than-temporary impairment not recognized in earnings on securities, income taxes (benefit)	6,017	132
Defined benefit pension plans, income taxes (benefit)	197	163
Unrealized gains (losses) on cash flow hedging instruments, income taxes (benefit)	$9,327	$28,223
Common stock per share dividend	0.05	0.375
Preferred stock per annum		5%

CONSOLIDATED STATEMENTS OF CASH

CONSOLIDATED STATEMENTS OF CASH FLOWS (USD $)
In Thousands	3 Months Ended Mar. 31, 2010		3 Months Ended Mar. 31, 2009
Operating Activities:
Income (loss) from continuing operations, net of tax	$719,451		($83,104)
Loss from discontinued operations, net of tax	(83,188)		(24,958)
Net income (loss)	636,263		(108,062)
Adjustments to reconcile net income to cash provided by operating activities:
Provision for loan and lease losses	1,478,200		1,279,137
Depreciation and amortization, net	147,516		151,278
Net gains on sales of securities available for sale	(106,894)		(4,335)
Net gains on deconsolidation	(177,526)		0
Loans held for sale:
Transfers in and originations	(210,129)		(281,981)
Losses on sales	16,699		1,567
Proceeds from sales	233,932		291,208
Stock plan compensation expense	46,550		24,715
Changes in assets and liabilities, net of effects from purchase of companies acquired and the effect of new accounting standards:
(Increase) decrease in interest receivable	(202,084)		12,171
Decrease in accounts receivable from securitizations	(61,379)	[1]	1,480,869
Decrease in other assets	1,139,504	[1]	164,289
Increase (decrease) in interest payable	12,941		(19,629)
(Decrease) in other liabilities	(948,461)	[1]	(1,525,306)
Net cash provided by operating activities attributable to discontinued operations	18,836		13,646
Net cash provided by operating activities	2,023,968		1,479,567
Investing Activities:
Increase in restricted cash for securitization investors	711,915	[1]	11,377
Purchases of securities available for sale	(9,402,805)		(5,980,615)
Proceeds from maturities of securities available for sale	2,850,816		1,794,765
Proceeds from sales of securities available for sale	7,428,829		740,191
Proceeds from securitizations of loans	0		2,892,903
Proceeds from sale of interest-only bonds	57,469		0
Net decrease in loans held for investment	4,167,789	[1]	1,439,780
Principal recoveries of loans previously charged off	400,762		192,928
Additions of premises and equipment	(73,473)		(107,218)
Net cash provided by companies acquired	0		778,166
Net cash provided by investing activities attributable to discontinued operations	150		3
Net cash provided by investing activities	6,141,452		1,762,280
Financing Activities:
Net increase (decrease) in deposits	1,977,463		(1,061,104)
Net decrease in other borrowings	(11,276,266)	[1]	(1,260,905)
Redemptions of acquired company debt and noncontrolling interest	0		(464,915)
Purchases of treasury stock	(17,798)		(2,955)
Dividends paid on common stock	(22,824)		(148,409)
Dividends paid on preferred stock	0		(44,934)
Net proceeds from issuances of common stock	7,168		9,230
Proceeds from share-based payment activities	(489)		(1,599)
Net cash used in financing activities attributable to discontinued operations	(18,932)		(3,274)
Net cash used in financing activities	(9,351,678)		(2,978,865)
Net increase (decrease) in cash and cash equivalents	(1,186,258)		262,982
Cash and cash equivalents at beginning of the period	8,684,624		7,491,343
Cash and cash equivalents at end of the period	7,498,366		7,754,325
Supplemental Cash Flow Information
Cumulative effect from adoption of new consolidation accounting standards	($2,938,912)
[1]Excludes the initial impact of adoption of the new consolidation standards.

Summary Of Significant Accounti

Summary Of Significant Accounting Policies
	3 Months Ended Mar. 31, 2010
Summary Of Significant Accounting Policies	NOTE 1SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES Business Capital One Financial Corporation (the "Corporation") is a diversified financial services company with banking and non-banking subsidiaries that market a variety of financial products and services. Our principal subsidiaries include: * Capital One Bank (USA), National Association ("COBNA") which currently offers credit and debit card products, other lending products and deposit products. * Capital One, National Association ("CONA") which offers a broad spectrum of banking products and financial services to consumers, small businesses and commercial clients. Our revenues are primarily driven by lending to consumers and commercial customers and by deposit-taking activities which generate net interest income, and by activities that generate non-interest income, including the sale and servicing of loans and providing fee-based services to customers. Customer usage and payment patterns, credit quality, levels of marketing expense and operating efficiency all affect our profitability. Our expenses primarily consist of the cost of funding our assets, our provision for loan and lease losses, operating expenses (including associate salaries and benefits, infrastructure maintenance and enhancements, and branch operations and expansion costs), marketing expenses, and income taxes. On February 27, 2009, the Corporation acquired Chevy Chase Bank, F.S.B. ("Chevy Chase Bank") for $475.9 million comprised of cash of $445.0 million and 2.56 million shares of common stock valued at $30.9 million. Chevy Chase Bank has the largest retail branch presence in the Washington D.C. region. On July 30, 2009, the Company merged Chevy Chase Bank with and into CONA. The Corporation and its subsidiaries are hereafter collectively referred to as the "Company" or "We." CONA and COBNA are hereafter collectively referred to as the "Banks." We report the results of our business through three operating segments: Credit Card, Commercial Banking and Consumer Banking. Credit Card: Consists of our domestic consumer and small business card lending, domestic national small business lending, national closed end installment lending and the international card lending businesses in Canada and the United Kingdom. Commercial Banking: Consists of our lending, deposit gathering and treasury management services to commercial real estate and middle market customers. Our Commercial Banking business results also include the results of a national portfolio of small ticket commercial real-estate loans that are in run-off mode. Consumer Banking: Consists of our branch-based lending and deposit gathering activities for small business customers, as well as branch-based consumer deposit gathering and lending activities, national deposit gathering, national automobile lending, consumer mortgage lending and servicing activities. Chevy Chase Bank's operations are included in the Commercial Banking and Consumer Banking segments beginning in the second quarter of 2009 but remained in Other for the first quarter due to the short duration since acquisition. The Other category includes GreenPoint

Loans Acquired in a Transfer

Loans Acquired in a Transfer
	3 Months Ended Mar. 31, 2010
Loans Acquired in a Transfer	NOTE 2LOANS ACQUIRED IN A TRANSFER The Company acquired loans from the purchase of Chevy Chase Bank acquisition on February 27, 2009 that were initially recorded at fair value with no separate valuation allowance recorded at the date of acquisition. The Company is required to review each loan at acquisition and determine whether each loan is to be accounted for individually or whether loans will be aggregated into pools of loans based on common risk characteristics. During the evaluation of whether a loan was considered impaired or is considered performing, the Company considered a number of factors, including the delinquency status of the loan, payment options and other loan features (i.e. reduced documentation, interest only, or negative amortization features), the geographic location of the borrower or collateral and the risk rating assigned to the loans. Based on the criteria, we considered the entire Chevy Chase Bank option arm, hybrid arm and construction to permanent portfolios to be impaired and accounted for under ASC 310-10/SOP 03-3. Portions of the Chevy Chase Bank commercial, auto, fixed mortgage, home equity, and other consumer loan portfolios were also considered impaired. The Company makes an estimate of the total cash flows it expects to collect from the pools of loans, which includes undiscounted expected principal and interest. The excess of that amount over the fair value of the loans is referred to as accretable yield. Accretable yield is recognized as interest income on a level-yield basis over the life of the loans. The Company also determines the loans' contractual principal and contractual interest payments. The excess of contractual amounts over the total cash flows expected to be collected from the loans is referred to as nonaccretable difference, which is not accreted into income. Judgmental prepayment assumptions are applied to both contractually required payments and cash flows expected to be collected at acquisition. The Company continues to estimate cash flows expected to be collected over the life of the loans. Subsequent increases in total cash flows expected to be collected are recognized as an adjustment to the accretable yield with the amount of periodic accretion adjusted over the remaining life of the loans. Subsequent decreases in cash flows expected to be collected over the life of the loans are recognized as impairment in the current period through allowance for loan loss. At acquisition, the loans acquired were as follows: At Acquisition (Dollars in thousands) ImpairedLoans Non-ImpairedLoans Total Loans Contractually required principal and interest at acquisition $ 12,038,971 $ 3,348,058 $ 15,387,029 Nonaccretable difference (expected principal losses of $2,207,144 and foregone interest of $1,820,065) (1) 3,851,043 176,166 4,027,209 Cash flows expected to be collected at acquisition $ 8,187,928 $ 3,171,892 $ 11,359,820 Accretable yield (interest component of expected cash flows) 1,860,697 499,245 2,359,942 Fair value of loans acquired (2) $ 6,327,231 $ 2,672,64

Discontinued Operations

Discontinued Operations
	3 Months Ended Mar. 31, 2010
Discontinued Operations	NOTE 3DISCONTINUED OPERATIONS Shutdown of Mortgage Origination Operations of Wholesale Mortgage Banking Unit In the third quarter of 2007, the company shut down the mortgage origination operations for GreenPoint and its wholesale mortgage banking unit, GreenPoint Mortgage ("GreenPoint"). GreenPoint was acquired by the Company in December 2006 as part of the North Fork acquisition. The results of the mortgage origination operations of GreenPoint have been accounted for as a discontinued operation and have been removed from the results of continuing operations for the three months ended March 31, 2010 and 2009. The company has no significant continuing involvement in the operations of the originate and sell business of GreenPoint. The loss from discontinued operations for the three months ended March 31, 2010 and 2009 includes an expense of $124.0 million, and $26.0 million, respectively, recorded in non-interest expense, for representations and warranties provided by the Company on loans previously sold to third parties by GreenPoint's mortgage origination operation. The following is summarized financial information for discontinued operations related to the closure of the Company's wholesale mortgage banking unit: (Dollars in thousands) ThreeMonthsEndedMarch31,2010 ThreeMonthsEndedMarch31,2009 Net interest income (expense) $ (451 ) $ (192 ) Non-interest income (expense) (128,502 ) (38,563 ) Income tax benefit (45,765 ) (13,797 ) Loss from discontinued operations, net of taxes $ (83,188 ) $ (24,958 ) The mortgage origination operations of our wholesale mortgage banking unit had assets of approximately $16.3 million and $30.6 million as of March 31, 2010 and March 31, 2009, respectively, consisting of $0.3 million and $15.9 million, respectively, of mortgage loans held for sale and other related assets. The related liabilities consisted of obligations to fund these assets and obligations for representations and warranties that we provided on loans previously sold to third parties.

Business Segments

Business Segments
	3 Months Ended Mar. 31, 2010
Business Segments	NOTE 4BUSINESS SEGMENTS The Company reports the results of its business through three operating segments: Credit Card, Commercial Banking and Consumer Banking. Credit Card: Consists of domestic consumer and small business card lending, domestic national small business lending, national closed end installment lending and the international card lending businesses in Canada and the United Kingdom. Commercial Banking: Consists of lending, deposit gathering and treasury management services to commercial real estate and middle market customers. Our Commercial Banking business results also include the results of a national portfolio of small ticket commercial real-estate loans that are in run-off mode. Consumer Banking: Consists of our branch-based lending and deposit gathering activities for small business customers, as well as branch-based consumer deposit gathering and lending activities, national deposit gathering, national automobile lending, consumer mortgage lending and servicing activities. The Company maintains the books and records on a legal entity basis for the preparation of financial statements in conformity with GAAP. The following tables present information prepared from the Company's internal management information systems, which is maintained based on managed financial statement view and on a line of business level through allocations from the consolidated financial results. Effective January 1, 2010, the Company adopted two new accounting standards that resulted in the consolidation of the majority of the Company's credit card securitization trusts. Because of the January 1, 2010, adoption of the new consolidation accounting standards, the Company's consolidated reported results subsequent to January 1, 2010 will be comparable to its consolidated results on a "managed" basis (except for the larger allowance for loan and lease losses). However, the total segment results differ from its reported consolidated results because our segment results include the loans underlying one of our installment loan securitization trusts that remains unconsolidated. The outstanding balance of the loans in this off-balance sheet trust that are reflected in the segment results was $150.8 million as of March 31, 2010. The following tables present certain information regarding our continuing operations by segment: (Dollars in thousands) Three Months Ended March31, 2010 Total Company CreditCard CommercialBanking ConsumerBanking Other TotalManaged SecuritizationAdjustment(1) TotalReported Net interest income(expense) $ 2,113,075 $ 311,401 $ 896,588 $ (90,933 ) $ 3,230,131 $ (1,978 ) $ 3,228,153 Non-interest income (expense) 718,632 42,375 315,612 (13,935 ) 1,062,684 (1,226 ) 1,061,458 Provision for loan and lease losses 1,175,217 238,209 49,526 18,452 1,481,404 (3,204 ) 1,478,200 Core deposit intangible amortization 14,389 37,735 52,124 52,124 Other non-interest expenses 914,052 178,031 650,646 52,748

Securities Available for Sale

Securities Available for Sale
	3 Months Ended Mar. 31, 2010
Securities Available for Sale	NOTE 5SECURITIES AVAILABLE FOR SALE The table below presents the expected maturities, gross unrealized gains and gross unrealized losses on available-for-sale securities, aggregated by category, as of March 31, 2010 and December 31, 2009. Expected Maturities (Dollars in thousands) 1YearorLess 15Years 510Years Over 10Years MarketValueTotals GrossUnrealizedGains GrossUnrealizedLosses AmortizedCostTotals March31, 2010 U.S.TreasuryandotherU.S. government agency obligations U.S. Treasury $ 70,293 $ 319,971 $ $ $ 390,264 $ 12,832 $ $ 377,432 Fannie Mae ("FNMA") 139,292 69,573 208,865 7,153 201,712 Freddie Mac ("FHLMC") 103,594 108,094 27,356 239,044 12,092 226,952 Other GSE and FDIC DGP ("DGP") 1,072 1,072 76 996 Total U.S. Treasury and other U.S. government agency obligations 313,179 498,710 27,356 839,245 32,153 807,092 Collateralized mortgage obligations ("CMO") FNMA 22,618 1,393,732 4,852,567 164,449 6,433,366 136,893 2,797 6,299,270 FHLMC 64,332 1,110,434 3,272,708 4,447,474 99,798 1,793 4,349,469 Ginnie Mae ("GNMA") 24,446 124,255 1,049,031 1,197,732 18,773 473 1,179,432 Non GSE 88,564 796,526 385,017 1,270,107 6 202,019 1,472,120 Total CMO 199,960 3,424,947 9,559,323 164,449 13,348,679 255,470 207,082 13,300,291 Mortgage backed securities ("MBS") FNMA 13,190 3,257,097 4,608,687 638,897 8,517,871 244,996 5,416 8,278,291 FHLMC 148,744 2,665,058 1,562,204 106,884 4,482,890 133,099 8,825 4,358,616 GNMA 11 45,653 1,015,185 1,060,849 30,629 255 1,030,475 Other GSE 824 824 1 1 824 Non GSE 168,927 353,966 310,410 833,303 350 123,190 956,143 Total MBS 161,945 6,137,559 7,540,042 1,056,191 14,895,737 409,075 137,687 14,624,349 Asset-backed securities ("ABS") 2,325,306 6,098,839 281,313 8,705,458 160,438 4,742 8,549,762 Other 189,670 108,689 16,215 147,324 461,898 13,568 4,678 453,008 Total $ 3,190,060 $ 16,268,744 $ 17,424,249 $ 1,367,964 $ 38,251,017 $ 870,704 $ 354,189 $ 37,734,502 Expected Mat

Loans Held for Investment, Allo

Loans Held for Investment, Allowance for Loan and Lease Losses and Unfunded Lending Commitments
	3 Months Ended Mar. 31, 2010
Loans Held for Investment, Allowance for Loan and Lease Losses and Unfunded Lending Commitments	NOTE 6LOANS HELD FOR INVESTMENT, ALLOWANCE FOR LOAN AND LEASE LOSSES AND UNFUNDED LENDING COMMITMENTS The composition of the loans held for investment portfolio (including loans restricted for securitization investors) was as follows: March31, 2010 December31,2009 Consumer loans: Credit cards Domestic $ 50,092,848 $ 13,373,383 International 7,548,484 2,229,321 Total credit cards 57,641,332 15,602,704 Installment loans Domestic 5,984,402 6,693,165 International 29,626 43,890 Total installment loans 6,014,028 6,737,055 Auto loans 17,446,430 18,186,064 Mortgage loans 13,966,471 14,893,187 Retail Banking 4,969,775 5,135,242 Total consumer loans 100,038,036 60,554,252 Commercial loans Commercial and multi family real estate 13,617,900 13,843,158 Middle Market 10,310,156 10,061,819 Specialty Lending 3,618,987 3,554,563 Small ticket commercial real estate 2,065,095 2,153,510 Total Commercial loans 29,612,138 29,613,050 Other loans 464,347 451,697 Total loans held for investment $ 130,114,521 $ 90,618,999 Of the $130.1 billion and $90.6 billion in the loans held for investment portfolio, $57.5 billion and $15.5 billion relate to restricted loans for securitization investors as of March 31, 2010 and December 31, 2009, respectively. Loans totaling approximately $2.0 billion and $2.3 billion, representing amounts which were greater than 90 days past due, were included in the Company's reported loan portfolio as of March 31, 2010 and December 31, 2009, respectively. As of March 31, 2010 and December 31, 2009, the Company had $1.4 billion and $1.3 billion, respectively, in non-performing loans. Loans that were considered individually impaired at March 31, 2010 and December 31, 2009 were $808.3 million and $787.8 million, respectively. The Company had a corresponding specific allowance for loan and lease losses of $155.8 million and $114.9 million at March 31, 2010 and December 31, 2009, respectively, relating to individually impaired loans of $415.2 million and $385.6 million at March 31, 2010 and December 31, 2009, respectively. The average balance of individually impaired loans was $773.4 million and $527.6 million for the three months ended March 31, 2010 and 2009, respectively. Interest income recognized during the three months ended March 31, 2010 and 2009 related to individually impaired loans was not material. Allowance for Loan and Lease Losses The following is a summary of changes in the allowance for loan and lease losses: Three Months Ended March31,2010 March31,2009 Balance at beginning of year $ 4,127,395 $ 4,523,960 Consolidation impact of securitization trusts 4,263,383 Adjusted balance at the beginning of the period 8,390,778 4,523,960 Provision for loan and lease losses 1,478,200 1,279,137 Other

Fair Value Of Financial Instrum

Fair Value Of Financial Instruments
	3 Months Ended Mar. 31, 2010
Fair Value Of Financial Instruments	NOTE 7FAIR VALUE OF FINANCIAL INSTRUMENTS Fair Value Measurements and Disclosures, defines fair value as the exchange price that would be received for an asset or paid to transfer a liability (an exit price) in the principal or most advantageous market for the asset or liability in an orderly transaction between market participants on the measurement date. Fair Value Measurements and Disclosures requires that valuation techniques maximize the use of observable inputs and minimize the use of unobservable inputs. It also establishes a fair value hierarchy which prioritizes the valuation inputs into three broad levels. Based on the underlying inputs, each fair value measurement in its entirety is reported in one of the three levels. These levels are: * Level 1Valuation is based upon quoted prices for identical instruments traded in active markets. Level 1 assets and liabilities include debt and equity securities traded in an active exchange market, as well as U.S. Treasury securities. * Level 2Valuation is based upon quoted prices for similar instruments in active markets, quoted prices for identical or similar instruments in markets that are not active, and model based valuation techniques for which all significant assumptions are observable in the market or can be corroborated by observable market data for substantially the full term of the assets or liabilities. * Level 3Valuation is determined using model-based techniques with significant assumptions not observable in the market. These unobservable assumptions reflect the Company's own estimates of assumptions that market participants would use in pricing the asset or liability. Valuation techniques include the use of third party pricing services, option pricing models, discounted cash flow models and similar techniques. The Fair Value Option for Financial Assets and Liabilities allows an entity the irrevocable option to elect fair value for the initial and subsequent measurement for certain financial assets and liabilities on a contract-by-contract basis. The Company has not made any material Fair Value Option for Financial Assets and Liabilities elections as of the end of the first quarter 2010. Assets and Liabilities Measured at Fair Value on a Recurring Basis March31, 2010 Fair Value Measurements Using (2) Assets/Liabilitiesat Fair Value Level 1 Level 2 Level 3 Assets Securities available for sale U.S. Treasury and other U.S. Gov't agency $ 390,264 $ 448,981 $ $ 839,245 Collateralized mortgage obligations 12,574,412 774,267 13,348,679 Mortgage-backed securities 14,524,896 370,841 14,895,737 Asset-backed securities 8,622,539 82,919 8,705,458 Other 87,992 348,020 25,886 461,898 Total securities available for sale $ 478,256 $ 36,518,848 $ 1,253,913 $ 38,251,017 Other assets Mortgage servicing rights 230,428 230,428 Derivative receivables(1) (2) 1,137 1,042,683 38,089

Goodwill and Other Intangible A

Goodwill and Other Intangible Assets
	3 Months Ended Mar. 31, 2010
Goodwill and Other Intangible Assets	NOTE 8GOODWILL AND OTHER INTANGIBLE ASSETS The Company's goodwill balance for quarter ended as March 31, 2010 was $13.6 billion; the decrease of $7.0 million from December 31, 2009 was primarily attributed to foreign currency translation adjustments. The goodwill is allocated to the Company's Credit Card, Commercial Banking and Consumer Banking segments and is tested for impairment at the reporting unit level, which is at the operating segment level or one level below an operating segment. There were no events requiring an interim impairment test and there has been no goodwill impairment recorded for the quarter ended March 31, 2010. The core deposit and trust intangibles reflect the estimated value of deposit and trust relationships. The lease intangibles reflect the difference between the contractual obligation under current lease contracts and the fair market value of the lease contracts at the acquisition date. The other intangible items relate to customer lists and brokerage relationships. The following table summarizes the Company's intangible assets subject to amortization. March31, 2010 GrossCarryingAmount AccumulatedAmortization NetCarryingAmount RemainingAmortizationPeriod Core deposit intangibles $ 1,561,920 $ (765,243 ) $ 796,677 7.7years Lease intangibles 53,992 (24,258 ) 29,734 22.5years Trust intangibles 10,500 (4,480 ) 6,020 13.7 years Other intangibles 35,148 (18,511 ) 16,637 3.0 years Total $ 1,661,560 $ (812,492 ) $ 849,068 December31, 2009 GrossCarryingAmount AccumulatedAmortization NetCarryingAmount RemainingAmortizationPeriod Core deposit intangibles $ 1,561,920 $ (713,119 ) $ 848,801 8.0years Lease intangibles 53,992 (22,845 ) 31,147 22.7years Trust intangibles 10,500 (4,256 ) 6,244 13.9 years Other intangibles 35,148 (15,414 ) 19,734 3.2 years Total $ 1,661,560 $ (755,634 ) $ 905,926 Intangibles are amortized on an accelerated basis using the sum of digits methodology over their respective estimated useful lives. Intangible assets are recorded in other assets on the balance sheet. Amortization expense for intangibles of $56.9 million and $52.4 million, is recorded to non-interest expense for the three months ended March 31, 2010 and March 31, 2009, respectively. The weighted average amortization period for all purchase accounting intangibles is 8.2 years. The following table summarizes the Company's estimated future amortization expense for intangible assets as of March 31, 2010: CurrentPeriodAmortizationAmount Three months ended March 31, 2010 $ 56,858 EstimatedFutureAmortizationAmounts 2010 (remaining nine months) $ 158,392 2011 183,188 2012 150,731 2013 121,790 2014 93,791 2015 67,136 Thereafter 74,040 Total $ 849,068

Deposits and Borrowings

Deposits and Borrowings
	3 Months Ended Mar. 31, 2010
Deposits and Borrowings	NOTE 9DEPOSITS AND BORROWINGS Borrowings as of March 31, 2010 and December 31, 2009 were as follows: March31,2010 December31,2009 Deposits Non-interest bearing deposits $ 13,773,082 $ 13,438,659 Interest-bearing deposits (1) 104,013,477 102,370,437 Total deposits $ 117,786,559 $ 115,809,096 Securitized debt obligations(2) Fixed, interest rates ranging from 3.20% to 6.40%, due 2010 to 2011 $ 10,198,742 $ 994,580 Variable, interest rates ranging from 0.22% to 4.74% due 2010 to 2033 27,630,785 2,958,912 Total securitized debt obligations $ 37,829,527 $ 3,953,492 Senior and subordinated notes Bank notes: 5.75% Senior Fixed Notes par value of $516,722 due 2010 $ 516,706 $ 516,696 5.125% Senior Fixed Notes par value of $274,696 due 2014 274,567 274,560 9.25% Subordinated Fixed Notes par value of $150,000 due 2010 152,913 154,319 6.50% Subordinated Fixed Notes par value of $500,000 due 2013 499,412 499,383 8.80% Subordinated Fixed Notes par value of $1,500,000 due 2019 1,499,444 1,499,452 Fair value hedge-related basis adjustments 81,476 52,667 Corporation notes: 5.70% Senior Fixed Notes par value of $854,451 due 2011 854,316 854,288 4.80% Senior Fixed Notes par value of $282,335 due 2012 282,016 281,975 6.25% Senior Fixed Notes par value of $277,665 due 2013 277,084 277,049 7.375% Senior Fixed Notes par value of $1,000,000 due 2014 995,745 995,548 5.50% Senior Fixed Notes par value of $375,005 due 2015 374,797 374,790 5.25% Senior Fixed Notes par value of $226,290 due 2017 225,793 225,777 6.75% Senior Fixed Notes par value of $1,341,045 due 2017 1,337,975 1,337,849 5.875% Subordinated Fixed Notes par value of $350,000 due 2012 354,648 355,108 5.35% Subordinated Fixed Notes par value of $100,000 due 2014 98,718 98,646 6.15% Subordinated Fixed Notes par value of $1,000,000 due 2016 997,775 997,689 Fair value hedge-related basis adjustments 310,907 249,674 Total senior and subordinated notes $ 9,134,292 $ 9,045,470 Other borrowings Junior subordinated debentures 8.00% Subordinated Fixed Notes par value of $103,093 due 2027 $ 108,738 $ 108,789 8.17% Subordinated Fixed Notes par value of $46,547 due 2028 49,547 49,564 3.339% Subordinated Floating Notes par value of $10,310 due 2033 (3) 10,843 10,843 7.686% Subordinated Fixed Notes par value of $651,000 due 2036 650,962 650,962 6.745% Subordinated Fixed Notes par value of $500,010 due 2037 499,991 499,991 10.25% Subordinated Fixed Notes par value of $1,000,010 due 2039 988,337 988,291 8.875% Subordinated Fixed Notes par value of $1,000,010 due 2040 986,917 986,881 7.50% Su

Shareholders' Equity, Other Com

Shareholders' Equity, Other Comprehensive Income and Earnings Per Common Share
	3 Months Ended Mar. 31, 2010
Shareholders' Equity, Other Comprehensive Income and Earnings Per Common Share	NOTE 10SHAREHOLDERS' EQUITY, OTHER COMPREHENSIVE INCOME AND EARNINGS PER COMMON SHARE Preferred Shares On November 14, 2008, the Company entered into an agreement (the "Securities Purchase Agreement") to issue 3,555,199 Fixed Rate Cumulative Perpetual Preferred Shares, Series A, par value $0.01 per share (the "Series A Preferred Stock"), to the United States Department of the Treasury ("U.S. Treasury") as part of the Company's participation in the Capital Purchase Program ("CPP"), having a liquidation amount per share equal to $1,000. The Series A Preferred Stock paid cumulative dividend at a rate of 5% per year for the first five years and thereafter at a rate of 9% per year. In addition, the Company issued a warrant (the "Warrants") to purchase 12,657,960 of the Company's common shares to the U.S. Treasury as part of the Securities Purchase Agreement. The Warrant has an exercise price of $42.13 per share and expires ten years from the issuance date. In 2009, the Company repurchased all 3,555,199 preferred shares at par, under the TARP Capital Purchase Program for approximately $3.57 billion including accrued dividends. With the repurchase, the remaining accretion of the discount of $461.7 million was accelerated and treated as dividend which reduced income available to common shares. On December 9, 2009, the warrants were sold by the U.S. Treasury for $11.75 per warrant. The sale by the U.S. Treasury had no impact on the Company's equity and the warrants remain outstanding and are included in paid in capital. Common Shares Secondary Equity Offering On May 11, 2009, the company raised $1.5 billion through the issuance of 56,000,000 shares of common stock at $27.75 per share. Accumulated Other Comprehensive Income The following table presents the cumulative balances of accumulated other comprehensive income, net of deferred tax of $144.9 million and $ 66.8 million as of March 31, 2010 and December 31, 2009: March31,2010 December31,2009 Net unrealized gains on securities(1) $ 334,597 $ 199,627 Net unrecognized elements of defined benefit plans (29,655 ) (29,297 ) Foreign currency translation adjustments (83,232 ) (26,398 ) Unrealized (losses) gains on cash flow hedging instruments (45,709 ) (60,117 ) Initial application of the measurement date provisions of ASC 715-30/FAS 158 (1,161 ) (1,161 ) Initial application from adoption of consolidation standards (15,924 ) Total accumulated other comprehensive income $ 158,916 $ 82,654 (1) Includes net unrealized gains (losses) on securities available for sale and retained subordinated notes. Unrealized losses not related to credit on other-than-temporarily impaired securities of $149.9 million (net of income tax was $96.6 million) and $181.3 million (net of income tax was $116.8 million) was reported in accumulative other comprehensive income as of March31, 2010 and December31, 2009, respectively. During the three months ended March 31, 2010 and 2009, the Company reclassified $20.4 million, and $45.8 million, respec

Mortgage Servicing Rights

Mortgage Servicing Rights (MSR)
	3 Months Ended Mar. 31, 2010
Mortgage Servicing Rights (MSR)	NOTE 11MORTGAGE SERVICING RIGHTS (MSR) MSRs are recognized at fair value when mortgage loans are sold or securitized in the secondary market and the right to service these loans is retained for a fee. MSRs are recorded at fair value and changes in fair value in current period earnings as a component of mortgage servicing and other income. The Company may enter into derivatives to economically hedge changes in fair value of MSRs. The Company has no other loss exposure on MSRs in excess of the recorded fair value. The Company continues to operate the mortgage servicing business and to report the changes in the fair value of MSRs in continuing operations. To evaluate and measure fair value, the underlying loans are stratified based on certain risk characteristics, including loan type, note rate and investor servicing requirements. The following table sets forth the changes in the fair value of mortgage servicing rights during the three months ended March 31, 2010 and March 31, 2009: Mortgage Servicing Rights: 2010 2009 Balance, beginning of period $ 239,651 $ 150,544 Acquired in acquisitions (1) 109,538 Originations 3,542 2,342 Sales Change in fair value, net (12,765 ) (3,761 ) Balance at March31 $ 230,428 $ 258,663 Ratio of mortgage servicing rights to related loans serviced for others 0.86 % 0.79 % Weighted average service fee 0.28 0.29 (1) Related to the Chevy Chase Bank acquisition completed on February27, 2009. Fair value adjustments to the MSRs for the three months ended March 31, 2010 and 2009 included decreases of $10.3 million and $6.4 million, respectively, due to run-off, and a decrease of $2.4 million and increase of $2.7 million, respectively, due to changes in the valuation inputs and assumptions. The significant assumptions used in estimating the fair value of the MSRs at March 31, 2010 and 2009 were as follows: March31,2010 March31,2009 Weighted average prepayment rate (includes default rate) 15.92 % 22.70 % Weighted average life (in years) 5.57 3.8 Discount rate 11.64 % 11.55 % The decrease in the weighted average prepayment rate, and corresponding increase in the weighted average life, were both driven by an estimated reduction in voluntary attrition due to market conditions. At March 31, 2010, the sensitivities to immediate 10% and 20% increases in the weighted average prepayment rates would decrease the fair value of mortgage servicing rights by $10.2 million and $19.6 million, respectively. At March 31, 2010, the sensitivities to immediate 10% and 20% adverse changes in servicing costs would decrease the fair value of mortgage servicing rights by $11.1 million and $22.2 million, respectively. As of March 31, 2010, the Company's mortgage loan servicing portfolio consisted of mortgage loans with an aggregate unpaid principal balance of $38.9 billion, of which $26.8 billion was serviced for investors other than the Company. As of March 31, 2009, the Company's mortgage loa

Derivative Instruments and Hedg

Derivative Instruments and Hedging Activities
	3 Months Ended Mar. 31, 2010
Derivative Instruments and Hedging Activities	NOTE 12DERIVATIVE INSTRUMENTS AND HEDGING ACTIVITIES The Company manages market risk within limits governed by its risk management policies as established by the Asset and Liability Management Committee ("ALCO") and approved by the Board of Directors. The Company utilizes derivatives to manage and position its earnings and economic value of equity sensitivity within the approved limits. These derivatives are used to primarily manage risk related to changes in interest rates and to a lesser extent, foreign exchange rates. The Company uses a wide range of derivative instruments, including from time to time, interest rate swaps, interest rate caps, floors, options, futures and forward contracts to manage interest rate risk. The Company recognizes all of its derivative instruments as either assets or liabilities in the balance sheet at fair value. These instruments are recorded in other assets or other liabilities on the Consolidated Balance Sheet and in the operating section of the Statement of Cash Flows as increases or decreases of other assets and other liabilities. The Company's policy is not to offset fair value amounts recognized for derivative instruments and fair value amounts recognized for the right to reclaim cash collateral or the obligation to return cash collateral arising from derivative instruments recognized at fair value executed with the same counterparty under master netting arrangements. As of March 31, 2010 and 2009, the Company had recorded $35.9 million and $557.2 million, respectively, for the right to retain cash collateral and $480.2 million and $489.7 million, respectively, for the obligation to return cash collateral under master netting arrangements. The accounting for changes in the fair value (i.e., gains and losses) of a derivative instrument depends on whether it has been designated and qualifies as part of a hedging relationship and, further, on the type of hedging relationship. For those derivative instruments that are designated and qualify as hedging instruments the Company must designate the hedging instrument, based upon the exposure being hedged, as a fair value hedge, a cash flow hedge or a hedge of a net investment in a foreign operation. The Company is exposed to credit risk on its derivative positions, which it manages by establishing and monitoring limits as to the degree of risk that may be undertaken. The amount of credit risk is equal to the fair value gain on a derivative, because we may be unable to recover the related receivable if the counterparty fails to perform. When the fair value of a derivative contract is positive, this generally indicates that the counterparty owes the Company, and, therefore, creates a repayment risk for the Company. When the fair value of a derivative contract is negative, this generally indicates that the Company owes the counterparty, and therefore, has no repayment risk. The Company attempts to limit the credit (or repayment) risk in derivative instruments by entering into transactions with high-quality counterparties that are reviewed periodically. The Company also maintains a policy of requiring that all derivative contracts be governed by an Inte

Securitizations

Securitizations
	3 Months Ended Mar. 31, 2010
Securitizations	NOTE 13SECURITIZATIONS Securitization transactions have been utilized by the Company for liquidity and funding purposes. The Company receives the proceeds from third party investors for debt securities issued from securitization trusts which are collateralized by transferred receivables from the Company's portfolio. The Company removes loans from its consolidated balance sheet when securitizations qualify as sales to nonconsolidated VIEs. Alternatively, when the transfer does not qualify as a sale but instead is considered a secured borrowing, or when the sale is to a consolidated VIE, the assets will remain on the Company's consolidated financial statements with an offsetting liability recognized for the amount of proceeds received. For periods prior to January 1, 2010, the Company used QSPEs to conduct the majority of its securitization transactions. Those transactions previously qualified as sales to non-consolidated trusts, resulting in off-balance sheet treatment of all of the assets and liabilities of the trusts, including the securitized loans and the securities issued to third parties Effective January 1, 2010, the Company adopted the new consolidation guidance which removed the concept of a QSPE resulting in the consolidation of the Company's credit card trusts, one installment loan trust, and certain mortgage trusts. The Company was considered to be the primary beneficiary of the impacted trusts due to the combination of power over the activities that most significantly impact the economic performance of the trusts through the right to service the securitized loans and the obligation to absorb losses or the right to receive benefits that could potentially be significant to the trusts through its retained interests. Prior to consolidation of the applicable QSPEs, the consolidated balance sheet included retained interests in the securitized loans in the form of interest-only strips, retained tranches, cash collateral accounts, cash reserve accounts and unpaid interest and fees on the investors' portion of the transferred principal receivables. The Company also included on its consolidated balance sheet a retained transferor's interest in credit card loan receivables transferred to the trusts, carried on a historical cost basis and reported as loans held for investment on the consolidated balance sheet. As a result of consolidation of its credit card trusts and applicable installment loan and mortgage trusts, the Company recorded a $47.6 billion increase in loan receivables, a $4.3 billion increase in allowance for loan and lease losses related to the newly consolidated loans, a $44.3 billion increase to securitized debt obligations, a $2.0 billion increase to other net assets and a $2.9 billion reduction in stockholders' equity. As part of the impact of consolidation, any retained interests in previously off-balance sheet securitizations were either eliminated or reclassified, generally to loans held for investment, accrued interest receivable or restricted cash. See "Note 1 Significant Accounting Policies" for more detail on the impacts of consolidation on the Company's financial statements. The following table pr

Commitments, Contingencies and

Commitments, Contingencies and Guarantees
	3 Months Ended Mar. 31, 2010
Commitments, Contingencies and Guarantees	NOTE 14COMMITMENTS, CONTINGENCIES AND GUARANTEES Letters of Credit The Company issues letters of credit (financial standby, performance standby and commercial) to meet the financing needs of its customers. Standby letters of credit are conditional commitments issued by the Company to guarantee the performance of a customer to a third party in a borrowing arrangement. Commercial letters of credit are short-term commitments issued primarily to facilitate trade finance activities for customers and are generally collateralized by the goods being shipped to the client. Collateral requirements are similar to those for funded transactions and are established based on management's credit assessment of the customer. Management conducts regular reviews of all outstanding letters of credit and customer acceptances, and the results of these reviews are considered in assessing the adequacy of the Company's allowance for loan and lease losses. The Company had contractual amounts of standby letters of credit and commercial letters of credit of $1.7 billion at March 31, 2010. As of March 31, 2010, financial guarantees had expiration dates ranging from 2010 to 2020. The fair value of the guarantees outstanding at March 31, 2010 that have been issued since January 1, 2003, was $2.8 million and was included in other liabilities. Potential Mortgage Representation Warranty Liabilities As part of broader acquisitions, the Company acquired three subsidiaries that originated residential mortgage loans and sold them to various purchasers, including securitization trusts. These subsidiaries are Capital One Home Loans, which was acquired in February 2005; GreenPoint, which was acquired in December 2006 as part of the North Fork acquisition; and Chevy Chase Bank, which was acquired in February 2009 and subsequently merged into CONA. In connection with their sales of mortgage loans, the subsidiaries entered into agreements containing representations and warranties about, among other things, the mortgage loans and the origination process. Each subsidiary may be required to repurchase mortgage loans in the event of certain breaches of these representations and warranties. In the event of a repurchase, the subsidiary is typically required to pay the then unpaid principal balance of the loan together with interest and certain expenses (including, in certain cases, legal costs incurred by the purchaser and/or others), and the subsidiary then recovers the underlying collateral. Each subsidiary is exposed to any losses on the repurchased loans after giving effect to recoveries on the collateral. Each subsidiary may also be required to indemnify certain purchasers and others against losses they incur in the event of breaches of representations and warranties and in various other circumstances, and the amount of such losses could exceed the repurchase amount of the related loans. These subsidiaries, in total, originated and sold an aggregate of approximately $121.9 billion original principal balance of mortgage loans between 2005 and 2008, the years with respect to which most of the repurchase requests and other claims relate. Some of this original principal

Other Variable Interest Entitie

Other Variable Interest Entities
	3 Months Ended Mar. 31, 2010
Other Variable Interest Entities	NOTE 15OTHER VARIABLE INTEREST ENTITIES The Company is involved with various entities that are considered to be VIEs. With respect to its interests, the Company is required to consolidate any VIE in which it is determined to be the primary beneficiary. The Company reviews all significant interests in the VIEs it is involved with such as amounts and types of financial and other support including equity investments, debt financing and guarantees. The Company also considers the activities of the VIEs that most significantly impact the VIEs economic performance and whether it has control over those activities. To provide the necessary disclosures, the Company aggregates similar VIEs based on the nature and purpose of the entities. The Company is also involved in various securitization transactions in the ordinary course of business. Please refer to "Note 11Mortgage Servicing Rights", "Note 13Securitizations" and "Note 14Commitments, Contingencies and Guarantees" for disclosures on involvement with other types of VIEs. This note is limited to non-securitization trusts and entities. The new consolidation guidance amends the guidance for determining whether an entity is a VIE, replaces the quantitative approach for determining the primary beneficiary with a qualitative assessment, and requires ongoing assessments as to whether an enterprise is the primary beneficiary of the VIE. Under the new consolidation guidance the primary beneficiary is the entity that has (i) the power to direct the activities of a VIE that most significantly impact the entity's economic performance and (ii) the obligation to absorb losses of the entity that could potentially be significant to the VIE or the right to receive benefits from the entity that could potentially be significant to the VIE. As part of its community reinvestment initiatives, the Company invests in private investment funds that make equity investments in multi-family affordable housing properties. The Company receives affordable housing tax credits for these investments. The activities of these entities are financed with a combination of invested equity capital and debt. As a result of new consolidation guidance certain investment funds are no longer considered to be variable interest entities and are not included in the March 31, 2010 balances in the table below. These investment funds were consolidated by the Company as of January 1, 2010, the net consolidation impact to other liabilities was $67.4 million. The assets of the unconsolidated investment funds that were VIEs at March 31, 2010 and December 31, 2009 were approximately $6.7 billion and $7.3 billion, respectively. The Company is not required to consolidate the investment funds that are VIEs as it does not have the power to direct the activities that most significantly impact the economic performance of those entities. The Company records its interests in the unconsolidated VIEs in loans held for investment, other assets and other liabilities. The Company's maximum exposure to these entities is limited to its variable interests in the entities. Please refer to the table below for additional details. The creditors of the VIEs hav

Subsequent Events

Subsequent Events
	3 Months Ended Mar. 31, 2010
Subsequent Events	NOTE 16SUBSEQUENT EVENTS We evaluate subsequent events that have occurred after the balance sheet date but before the financial statements are issued. There are two types of subsequent events: (1) recognized, or those that provide additional evidence about conditions that existed at the date of the balance sheet, including the estimates inherent in the process of preparing financial statements, and (2) nonrecognized, or those that provide evidence about conditions that did not exist at the date of the balance sheet but arose after that date. Based on the evaluation, we did not identify any recognized or nonrecognized subsequent events that would have required adjustment to the financial statements.