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Capital One Reports First Quarter Earnings

April 20, 2005 at 4:07 PM EDT
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Company Reaffirms EPS Guidance for 2005 of $6.60 to $7.00

MCLEAN, Va., April 20, 2005 /PRNewswire-FirstCall via COMTEX/ -- Capital One Financial Corporation (NYSE: COF) today announced that its earnings for the first quarter of 2005 were $506.6 million, or $1.99 per share (diluted), compared with $450.8 million, or $1.84 per share, for the first quarter of 2004, and $195.1 million, or $.77 per share, in the fourth quarter of 2004.

"The company's first quarter results reflect strong performance in our US Card business as well as continued success in our Auto Finance and Global Financial Services businesses," said Richard D. Fairbank, Capital One's Chairman and Chief Executive Officer. "Additionally, the acquisition of Hibernia Corporation, which we announced in March, will enhance our diversification efforts and growth prospects, while lowering our funding costs and overall risk profile."

Managed loans grew to $81.6 billion as of March 31, 2005, up $1.7 billion, or 9 percent annualized, from the previous quarter, and up $9.8 billion, or 14 percent, from the first quarter of 2004. The company continues to expect that managed loans will grow at a rate of between 12 and 15 percent during 2005, excluding the impact of the Hibernia transaction.

The managed charge-off rate decreased to 4.13 percent in the first quarter of 2005 from 4.37 percent in the previous quarter, and from 4.83 percent in the first quarter of 2004. The company now expects its quarterly managed charge-off rate to stay below 4.25 percent in 2005, with seasonal variations and excluding the impact of the Hibernia transaction. The company decreased its allowance for loan losses in the first quarter of 2005 by $65.0 million. The reduction was driven largely by seasonality of loan growth and credit metrics. The company continues to expect a net increase in its allowance for loan losses in the full year 2005, inclusive of the first quarter reduction and excluding the impact of the Hibernia transaction. The managed delinquency rate (30+ days) decreased to 3.45 percent as of March 31, 2005 from 3.82 percent as of the end of the previous quarter. The managed delinquency rate as of March 31, 2004 was 3.80 percent.

"Solid revenue growth, improvements in operating efficiency, and strong credit performance across our business keeps us on track to deliver diluted earnings of between $6.60 and $7.00 per share in 2005," said Gary L. Perlin, Capital One's Chief Financial Officer. This earnings guidance incorporates the expected impact of completing the acquisition of Hibernia Corporation in the third quarter of 2005, and includes pro rata 2005 earnings for Hibernia Corporation as estimated by I/B/E/S as of March 4, 2005.

Capital One's managed revenue margin decreased to 12.50 percent in the first quarter of 2005 from 12.66 percent in the previous quarter, in line with our bias towards lower loss assets. The company's managed revenue margin was 13.38 percent in the first quarter of 2004.

Marketing expenses for the first quarter of 2005 were $311.8 million, down $199.3 million from the $511.1 million spent in the fourth quarter of 2004. Marketing expenses were $255.1 million in the comparable quarter of the prior year. The company continues to expect annual marketing spend for 2005 to be similar to 2004, excluding the impact of the Hibernia transaction.

Annualized operating expenses as a percentage of average managed loans decreased to 4.98 percent in the first quarter of 2005, down from 5.44 percent in the previous quarter and 5.45 percent in the first quarter of 2004. Included in first quarter 2005 operating expenses were charges totaling $23.7 million for a combination of employee termination benefits and continued facility consolidations, as well as an $18.8 million reversal of a previously recognized impairment related to the sale of the Tampa, FL facility. The company expects about $40 million in additional restructuring charges in 2005 related to programs initiated in 2004.

The company continues to expect a return on managed assets of between 1.7 and 1.8 percent in 2005, with some quarterly variability, excluding the impact of the Hibernia transaction. The company expects that modest declines in its managed revenue margin will be more than offset by improvements in expenses as a percentage of managed loans.

During the first quarter of 2005, Capital One completed the acquisitions of Hfs Group, Onyx, InsLogic, and eSmartloan. Capital One also announced a definitive agreement to acquire Hibernia Corporation (NYSE: HIB) in a stock and cash transaction valued at approximately $5.3 billion. The transaction is subject to regulatory and Hibernia shareholder approvals and is expected to be completed in the third 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.

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 April 20, 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, the benefits of the business combination transaction involving Capital One and Hibernia, including future financial and operating results, and the new company's plans, objectives, expectations and intentions 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; the ability to obtain regulatory approvals of the proposed Capital One -- Hibernia transaction on the proposed terms and schedule; the failure of Hibernia stockholders to approve the transaction; the risk that the businesses will not be integrated successfully; the risk that the cost savings and any other synergies from the transaction may not be fully realized or may take longer to realize than expected; and disruption from the transaction making it more difficult to maintain relationships with customers, employees or suppliers.

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-K for the fiscal year ended December 31, 2004.

Additional Information About the Capital One - Hibernia Transaction

In connection with the proposed merger between Capital One and Hibernia, Capital One and Hibernia will file with the Securities and Exchange Commission (the "SEC") a Registration Statement on Form S-4 that will include a proxy statement of Hibernia that also constitutes a prospectus of Capital One. Hibernia will mail the proxy statement/prospectus to its stockholders. Investors and security holders are urged to read the proxy statement/prospectus regarding the proposed merger when it becomes available because it will contain important information. A free copy of the proxy statement/prospectus (when available) and other related documents filed by Capital One and Hibernia with the SEC may be obtained at the SEC's website at http://www.sec.gov. The proxy statement/prospectus (when it is available) and the other documents may also be obtained for free by accessing Capital One's website at http://www.capitalone.com under the tab "Investors" and then under the heading "SEC & Regulatory Filings" or by accessing Hibernia's website at http://www.hibernia.com under the tab "About Hibernia" and then under the heading "Investor Relations-SEC Filings."

Capital One, Hibernia and their respective directors, executive officers and certain other members of management and employees may be soliciting proxies from Hibernia stockholders in favor of the merger. Information regarding the persons who may, under the rules of the SEC, be considered participants in the solicitation of the Hibernia stockholders in connection with the proposed merger will be set forth in the proxy statement/prospectus when it is filed with the SEC. You can find information about Capital One's executive officers and directors in its definitive proxy statement filed with the SEC on March 21, 2005. You can find information about Hibernia's executive officers and directors in its definitive proxy statement filed with the SEC on March 15, 2005. You can obtain free copies of these documents from Capital One and Hibernia using the contact information above.

About Capital One

Headquartered in McLean, Virginia, Capital One Financial Corporation (http://www.capitalone.com) is a bank holding company whose principal subsidiaries, Capital One Bank, Capital One, F.S.B. and Capital One Auto Finance, Inc. offer a variety of consumer lending products. Capital One's subsidiaries collectively had 49.1 million accounts and $81.6 billion in managed loans outstanding as of March 31, 2005. Capital One is a Fortune 500 company and, through its subsidiaries, 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: First quarter 2005 financial results, SEC Filings, and first quarter earnings conference call slides are accessible on Capital One's home page (http://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 5:00 pm (EDT) earnings conference call is accessible through the same link.

CAPITAL ONE FINANCIAL CORPORATION (COF)
                 FINANCIAL & STATISTICAL SUMMARY REPORTED BASIS

                                         2005          2004          2004
    (in millions, except per share
     data and as noted)                   Q1            Q4            Q1
    Earnings (Reported Basis)
    Net Interest Income                 $860.5        $784.6        $732.0
    Non-Interest Income                1,516.0       1,521.5 (1)   1,443.1
    Total Revenue(2)                   2,376.5       2,306.1       2,175.1
    Provision for Loan Losses            259.6         467.1         243.7
    Marketing Expenses                   311.8         511.1         255.1
    Operating Expenses                 1,016.1 (3)   1,045.4 (3)     969.7
    Income Before Taxes                  789.0         282.5         706.6
    Tax Rate                              35.8 %        30.9 %        36.2 %
    Net Income                          $506.6        $195.1        $450.8
    Common Share Statistics
    Basic EPS                            $2.08         $0.82         $1.94
    Diluted EPS                          $1.99         $0.77         $1.84
    Dividends Per Share                  $0.03         $0.03         $0.03
    Book Value Per Share
     (period end)                       $35.62        $33.99        $28.54
    Stock Price Per Share
     (period end)                       $74.77        $84.21        $75.43
    Total Market Capitalization
     (period end)                    $18,849.5     $20,783.0     $18,084.9
    Shares Outstanding (period end)      252.1         246.8         239.8
    Shares Used to Compute Basic EPS     244.0         239.2         232.0
    Shares Used to Compute
     Diluted EPS                         255.2         253.0         245.4
    Reported Balance Sheet
     Statistics (period avg.)
    Average Loans                      $38,204       $36,096       $32,878
    Average Earning Assets             $50,898       $49,500       $44,112
    Average Assets                     $56,288       $53,339       $47,699
    Average Equity                      $8,568        $8,221        $6,443
    Return on Average Assets (ROA)        3.60 %        1.46 %        3.78 %
    Return on Average Equity (ROE)       23.65 %        9.49 %       27.99 %
    Reported Balance Sheet
     Statistics (period end)
    Loans                              $37,959       $38,216       $33,172
    Total Assets                       $55,632       $53,747       $49,146
    Capital (4)                         $9,839        $9,231        $7,675
    Loan growth                          $(257)       $3,055          $321
    % Loan Growth Q Over Q
     (annualized)                           (3)%          35 %           4 %
    % Loan Growth Y Over Y                  14 %          16 %          20 %
    Capital to Assets Ratio              17.69 %       17.17 %       15.62 %
    Capital plus Allowance to Assets
     Ratio                               20.27 %       19.98 %       18.66 %
    Revenue & Expense Statistics
     (Reported)
    Net Interest Income Growth
     (annualized)                           39 %           5 %          41 %
    Non Interest Income Growth
     (annualized)                           (1)%          (5)%           2 %
    Revenue Growth (annualized)             12 %          (2)%          14 %
    Net Interest Margin                   6.76 %        6.34 %        6.64 %
    Revenue Margin                       18.68 %       18.64 %       19.72 %
    Risk Adjusted Margin (5)             16.08 %       15.85 %       16.62 %
    Operating Expense as a % of
     Revenues                            42.76 %       45.33 %       44.58 %
    Operating Expense as a % of Avg
     Loans (annualized)                  10.64 %       11.58 %       11.80 %
    Asset Quality Statistics
     (Reported)
    Allowance                           $1,440        $1,505        $1,495
    30+ Day Delinquencies               $1,319        $1,472        $1,266
    Net Charge-Offs                       $330          $345          $342
    Allowance as a % of Reported
     Loans                                3.79 %        3.94 %        4.51 %
    Delinquency Rate (30+ days)           3.47 %        3.85 %        3.82 %
    Net Charge-Off Rate                   3.46 %        3.82 %        4.17 %

    (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: Q1 2005 - $243.9, Q4 2004 - $276.8, Q3
        2004 -  $269.7, Q2 2004 - $263.5 million, and Q1 2004 - $285.5
        million.
    (3) Includes employee termination benefits and charges for facility
        consolidation related to corporate-wide cost reduction initiatives of
        $23.7 million, $42.1 million, $26.7 million and $56.0 million for Q1
        2005, Q4 2004, Q3 2004 and Q2 2004, respectively. In addition, Q1 2005
        includes a $18.8 million reversal of a previously recognized
        impairment related to the sale of the Tampa, FL facility and Q3 2004
        had charges of $20.6 million related to a change in the 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)

                                           2005         2004         2004
    (in millions)                           Q1           Q4           Q1
    Earnings (Managed Basis)
    Net Interest Income                  $1,818.8     $1,701.8     $1,677.1
    Non-Interest Income                   1,071.4      1,099.0 (2)  1,014.5
    Total Revenue (3)                     2,890.2      2,800.8      2,691.6
    Provision for Loan Losses               773.3        961.8        760.1
    Marketing Expenses                      311.8        511.1        255.1
    Operating Expenses                    1,016.1 (4)  1,045.4 (4)    969.7
    Income Before Taxes                     789.0        282.5        706.6
    Tax Rate                                 35.8 %       30.9 %       36.2 %
    Net Income                             $506.6       $195.1       $450.8
    Managed Balance Sheet Statistics
     (period avg.)
    Average Loans                         $81,652      $76,930      $71,148
    Average Earning Assets                $92,477      $88,461      $80,495
    Average Assets                        $99,283      $93,574      $85,324
    Return on Average Assets (ROA)           2.04 %       0.83 %       2.11 %
    Managed Balance Sheet Statistics
     (period end)
    Loans                                 $81,592      $79,861      $71,817
    Total Assets                          $98,724      $94,792      $87,197
    Loan Growth                            $1,731       $4,404         $572
    % Loan Growth Q over Q (annualized)         9 %         23 %          3 %
    % Loan Growth Y over Y                     14 %         12 %         21 %
    Capital to Assets Ratio                  9.97 %       9.74 %       8.80 %
    Capital plus Allowance to Assets
     Ratio                                  11.42 %      11.33 %      10.52 %
    Number of Accounts (000's)             49,062       48,573       46,712
    % Off-Balance Sheet Securitizations        53 %         52 %         53 %
    % at Introductory Rate                      6 %          7 %          8 %
    Revenue & Expense Statistics
     (Managed)
    Net Interest Income Growth
     (annualized)                              28 %          8 %         27 %
    Non Interest Income Growth
     (annualized)                             (10)%          0 %        (23)%
    Revenue Growth (annualized)                13 %          4 %          6 %
    Net Interest Margin                      7.87 %       7.70 %       8.33 %
    Revenue Margin                          12.50 %      12.66 %      13.38 %
    Risk Adjusted Margin (5)                 8.85 %       8.87 %       9.11 %
    Operating Expense as a % of Revenues    35.16 %      37.33 %      36.03 %
    Operating Expense as a % of Avg
     Loans (annualized)                      4.98 %       5.44 %       5.45 %
    Asset Quality Statistics (Managed)
    30+ Day Delinquencies                  $2,812       $3,054       $2,731
    Net Charge-Offs                          $844         $840         $859
    Delinquency Rate (30+ days)              3.45 %       3.82 %       3.80 %
    Net Charge-Off Rate                      4.13 %       4.37 %       4.83 %

    (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."
    (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: Q1 2005 - $243.9, Q4 2004 - $276.8, Q3
        2004 - $269.7, Q2 2004 - $263.5 million, and Q1 2004 - $285.5 million.
    (4) Includes employee termination benefits and charges for facility
        consolidation related to corporate-wide cost reduction initiatives of
        $23.7 million, $42.1 million, $26.7 million and $56.0 million for Q1
        2005, Q4 2004, Q3 2004 and Q2 2004, respectively. In addition, Q1 2005
        includes a $18.8 million reversal of a previously recognized
        impairment related to the sale of the Tampa, FL facility and Q3 2004
        had charges of $20.6 million related to a change in the 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)

                                           2005         2004         2004
    (in thousands)                          Q1           Q4           Q1
    Segment Statistics
    US Card:
      Net interest income                 1,250,638   $1,158,773   $1,200,577
      Non-interest income                   779,415      823,012      769,056
      Provision for loan losses             489,036      649,862      535,279
      Non-interest expenses                 836,142    1,016,384      829,925
      Income tax provision (benefit)        246,706      113,594      217,594
      Net income (loss)                    $458,169     $201,945     $386,835

      Loans receivable                  $46,629,763  $48,609,571  $45,297,959
      Net charge-off rate                     4.73%        4.93%        5.41%
      Delinquency Rate (30+ days)             3.66%        3.97%        3.99%

    Auto Finance:
      Net interest income                   249,507     $207,379     $189,199
      Non-interest income                    11,339       13,690       23,430
      Provision for loan losses              92,313       88,408       80,182
      Non-interest expenses                 113,765       93,482       84,533
      Income tax provision (benefit)         19,169       14,104       17,249
      Net income (loss)                     $35,599      $25,075      $30,665

      Loans receivable                  $13,292,953   $9,997,497   $8,833,929
      Net charge-off rate                     2.89%        3.87%        4.13%
      Delinquency Rate (30+ days)             3.51%        5.50%        5.44%

    Global Financial Services:
      Net interest income                  $412,733     $390,262     $331,889
      Non-interest income                   233,841      240,781      177,326
      Provision for loan losses             188,316      220,253      153,436
      Non-interest expenses                 351,476      368,020      279,860
      Income tax provision (benefit)         36,309       13,561       24,984
      Net income (loss)                     $70,473      $29,209      $50,935

      Loans receivable                  $21,683,102  $21,240,325  $17,642,995
      Net charge-off rate                     3.55%        3.30%        3.60%
      Delinquency Rate (30+ days)             3.04%        2.81%        2.63%

    Other:
      Net interest income                  $(94,118)    $(54,587)    $(44,587)
      Non-interest income                    46,806       21,496       44,724
      Provision for loan losses               3,627        3,277       (8,771)
      Non-interest expenses                  26,449       78,641       30,578
      Income tax provision (benefit)        (19,709)     (53,908)      (4,041)
      Net income (loss)                    $(57,679)    $(61,101)    $(17,629)

      Loans receivable                     $(13,826)     $13,906      $42,019

    Total:
      Net interest income                $1,818,760   $1,701,827   $1,677,078
      Non-interest income                 1,071,401    1,098,979    1,014,536
      Provision for loan losses             773,292      961,800      760,126
      Non-interest expenses               1,327,832    1,556,527    1,224,896
      Income tax provision (benefit)        282,475       87,351      255,786
      Net income (loss)                    $506,562     $195,128     $450,806

      Loans receivable                  $81,591,992  $79,861,299  $71,816,902
      Net charge-off rate                     4.13%        4.37%        4.83%
      Delinquency Rate (30+ days)             3.45%        3.82%        3.80%

    (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 March 31, 2005
                      (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.

                                          Total    Adjustments(1)    Total
                                        Reported                   Managed(2)
    Income Statement Measures
    Net interest income                   $860,521     $958,239   $1,818,760
    Non-interest income                 $1,515,979    $(444,578)  $1,071,401
    Total revenue                       $2,376,500     $513,661   $2,890,161
    Provision for loan losses             $259,631     $513,661     $773,292
    Net charge-offs                       $330,270     $513,661     $843,931
    Balance Sheet Measures
    Consumer loans                     $37,959,203  $43,632,789  $81,591,992
    Total assets                       $55,631,566  $43,092,298  $98,723,864
    Average consumer loans             $38,203,914  $43,448,571  $81,652,485
    Average earning assets             $50,897,655  $41,579,833  $92,477,488
    Average total assets               $56,287,734  $42,995,109  $99,282,843
    Delinquencies                       $1,318,958   $1,493,153   $2,812,111

    (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)

                                           March 31    December 31   March 31
                                             2005         2004         2004

    Assets:
    Cash and due from banks                 $761,234     $327,517     323,346
    Federal funds sold and resale
     agreements                               12,283      773,695   1,257,666
    Interest-bearing deposits at other
     banks                                   446,793      309,999     188,237
      Cash and cash equivalents            1,220,310    1,411,211   1,769,249
    Securities available for sale          9,460,688    9,300,454   9,149,440
    Consumer loans                        37,959,203   38,215,591  33,171,516
      Less:  Allowance for loan losses    (1,440,000)  (1,505,000) (1,495,000)
    Net loans                             36,519,203   36,710,591  31,676,516
    Accounts receivable from
     securitizations                       5,605,009    4,081,271   4,008,809
    Premises and equipment, net              806,411      817,704     898,802
    Interest receivable                      259,350      252,857     236,852
    Other                                  1,760,595    1,173,167   1,406,757
      Total assets                       $55,631,566  $53,747,255  49,146,425


    Liabilities:
    Interest-bearing deposits            $25,854,025  $25,636,802  23,610,851
    Senior and subordinated notes          6,876,432    6,874,790   7,224,798
    Other borrowings                      10,243,235    9,637,019   8,254,383
    Interest payable                         242,464      237,227     245,172
    Other                                  3,435,680    2,973,228   2,968,993
      Total liabilities                   46,651,836   45,359,066  42,304,197

    Stockholders' Equity:
    Common stock                               2,536        2,484       2,411
    Paid-in capital, net                   2,878,237    2,711,327   2,218,861
    Retained earnings and cumulative
     other comprehensive income            6,166,070    5,741,131   4,670,384
      Less:  Treasury stock, at cost         (67,113)     (66,753)    (49,428)
      Total stockholders' equity           8,979,730    8,388,189   6,842,228
      Total liabilities and
       stockholders' equity              $55,631,566  $53,747,255  49,146,425



                      CAPITAL ONE FINANCIAL CORPORATION
                      Consolidated Statements of Income
               (in thousands, except per share data)(unaudited)

                                                   Three Months Ended
                                              March 31  December 31  March 31
                                               2005        2004       2004

    Interest Income:
    Consumer loans, including past-due fees $1,184,036  $1,097,041  1,035,017
    Securities available for sale               90,164      88,085     63,716
    Other                                       62,068      64,204     65,998
      Total interest income                  1,336,268   1,249,330  1,164,731

    Interest Expense:
    Deposits                                   264,025     267,706    239,512
    Senior and subordinated notes              114,480     116,419    124,418
    Other borrowings                            97,242      80,641     68,779
      Total interest expense                   475,747     464,766    432,709
    Net interest income                        860,521     784,564    732,022
    Provision for loan losses                  259,631     467,133    243,668
    Net interest income after provision
     for loan losses                           600,890     317,431    488,354

    Non-Interest Income:
    Servicing and securitizations              951,602     915,511    917,669
    Service charges and other customer-
     related fees                              401,186     374,048    354,493
    Interchange                                123,440     135,843    105,595
    Other                                       39,751      96,173     65,377
      Total non-interest income              1,515,979   1,521,575  1,443,134

    Non-Interest Expense:
    Salaries and associate benefits            433,501     382,646    424,392
    Marketing                                  311,759     511,142    255,147
    Communications and data processing         142,819     137,867    117,106
    Supplies and equipment                      86,446      92,827     88,321
    Occupancy                                   17,901      55,994     38,719
    Other                                      335,406     376,051    301,211
      Total non-interest expense             1,327,832   1,556,527  1,224,896
    Income before income taxes                 789,037     282,479    706,592
    Income taxes                               282,475      87,351    255,786
    Net income                                $506,562    $195,128   $450,806


    Basic earnings per share                     $2.08       $0.82      $1.94

    Diluted earnings per share                   $1.99       $0.77      $1.84

    Dividends paid per share                     $0.03       $0.03      $0.03



                      CAPITAL ONE FINANCIAL CORPORATION
     Statements of Average Balances, Income and Expense, Yields and Rates
                      (dollars in thousands)(unaudited)

    Reported                                    Quarter Ended 3/31/05
                                            Average       Income/    Yield/
                                            Balance       Expense     Rate
    Earning assets:
     Consumer loans                        $38,203,914   $1,184,036   12.40%
     Securities available for sale           9,654,437       90,164    3.74%
     Other                                   3,039,304       62,068    8.17%
    Total earning assets                   $50,897,655   $1,336,268   10.50%

    Interest-bearing liabilities:
     Deposits                              $25,654,741     $264,025    4.12%
     Senior and subordinated notes           6,908,505      114,480    6.63%
     Other borrowings                       10,698,085       97,242    3.64%
    Total interest-bearing liabilities     $43,261,331     $475,747    4.40%

    Net interest spread                                                6.10%

    Interest income to average
     earning assets                                                   10.50%
    Interest expense to average
     earning assets                                                    3.74%
    Net interest margin                                                6.76%


    Reported                                    Quarter Ended 12/31/04
                                            Average       Income/    Yield/
                                            Balance       Expense     Rate
    Earning assets:
     Consumer loans                        $36,096,481   $1,097,041   12.16%
     Securities available for sale           9,741,355       88,085    3.62%
     Other                                   3,662,512       64,204    7.01%
    Total earning assets                   $49,500,348   $1,249,330   10.10%

    Interest-bearing liabilities:
     Deposits                              $25,580,044     $267,706    4.19%
     Senior and subordinated notes           6,946,109      116,419    6.70%
     Other borrowings                        9,076,531       80,641    3.55%
    Total interest-bearing liabilities     $41,602,684     $464,766    4.47%

    Net interest spread                                                5.63%

    Interest income to average
     earning assets                                                   10.10%
    Interest expense to average
     earning assets                                                    3.76%
    Net interest margin                                                6.34%


    Reported                                    Quarter Ended 3/31/04
                                            Average       Income/    Yield/
                                            Balance       Expense     Rate
    Earning assets:
     Consumer loans                        $32,877,525   $1,035,017   12.59%
     Securities available for sale           7,098,951       63,716    3.59%
     Other                                   4,135,065       65,998    6.38%
    Total earning assets                   $44,111,541   $1,164,731   10.56%

    Interest-bearing liabilities:
     Deposits                              $22,992,712     $239,512    4.17%
     Senior and subordinated notes           7,270,889      124,418    6.84%
     Other borrowings                        7,834,046       68,779    3.51%
    Total interest-bearing liabilities     $38,097,647     $432,709    4.54%

    Net interest spread                                                6.02%

    Interest income to average
     earning assets                                                   10.56%
    Interest expense to average
     earning assets                                                    3.92%
    Net interest margin                                                6.64%



                      CAPITAL ONE FINANCIAL CORPORATION
     Statements of Average Balances, Income and Expense, Yields and Rates
                      (dollars in thousands)(unaudited)

    Managed (1)                                 Quarter Ended 3/31/05
                                            Average       Income/    Yield/
                                            Balance       Expense     Rate
    Earning assets:
     Consumer loans                        $81,652,485   $2,631,751   12.89%
     Securities available for sale           9,654,437       90,164    3.74%
     Other                                   1,170,566       17,672    6.04%
    Total earning assets                   $92,477,488   $2,739,587   11.85%

    Interest-bearing liabilities:
     Deposits                              $25,654,741     $264,025    4.12%
     Senior and subordinated notes           6,908,505      114,480    6.63%
     Other borrowings                       10,698,085       97,242    3.64%
     Securitization liability               43,215,671      445,080    4.12%
    Total interest-bearing liabilities     $86,477,002     $920,827    4.26%

    Net interest spread                                                7.59%

    Interest income to average
     earning assets                                                   11.85%
    Interest expense to average
     earning assets                                                    3.98%
    Net interest margin                                                7.87%


    Managed (1)                                 Quarter Ended 12/31/04
                                            Average       Income/    Yield/
                                            Balance       Expense     Rate
    Earning assets:
     Consumer loans                        $76,929,973   $2,476,365   12.88%
     Securities available for sale           9,741,355       88,085    3.62%
     Other                                   1,789,742       16,940    3.79%
    Total earning assets                   $88,461,070   $2,581,390   11.67%

    Interest-bearing liabilities:
     Deposits                              $25,580,044     $267,706    4.19%
     Senior and subordinated notes           6,946,109      116,419    6.70%
     Other borrowings                        9,076,531       80,641    3.55%
     Securitization liability               40,291,395      414,797    4.12%
    Total interest-bearing liabilities     $81,894,079     $879,563    4.30%

    Net interest spread                                                7.37%

    Interest income to average
     earning assets                                                   11.67%
    Interest expense to average
     earning assets                                                    3.97%
    Net interest margin                                                7.70%


    Managed (1)                                 Quarter Ended 3/31/04
                                            Average       Income/    Yield/
                                            Balance       Expense     Rate
    Earning assets:
     Consumer loans                        $71,148,287   $2,405,738   13.53%
     Securities available for sale           7,098,951       63,716    3.59%
     Other                                   2,247,996       13,056    2.32%
    Total earning assets                   $80,495,234   $2,482,510   12.34%

    Interest-bearing liabilities:
     Deposits                              $22,992,712     $239,512    4.17%
     Senior and subordinated notes           7,270,889      124,418    6.84%
     Other borrowings                        7,834,046       68,779    3.51%
     Securitization liability               37,669,211      372,723    3.96%
    Total interest-bearing liabilities     $75,766,858     $805,432    4.25%

    Net interest spread                                                8.09%

    Interest income to average
     earning assets                                                   12.34%
    Interest expense to average
     earning assets                                                    4.01%
    Net interest margin                                                8.33%


    (1)  The information in this table reflects the adjustment to add back the
    effect of securitized loans.

SOURCE Capital One Financial Corporation

Media Relations: Tatiana Stead, +1-703-720-2352, or Julie Rakes, +1-804-284-5800, or Investor Relations: Mike Rowen, +1-703-720-3203, all of Capital One Financial Corporation