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Capital One Reports First Quarter Earnings Per Share

April 21, 2004 at 4:07 PM EDT
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36% EPS Increase Over Year Ago Period 2004 Earnings Guidance Unchanged

MCLEAN, Va., Apr 21, 2004 /PRNewswire-FirstCall via COMTEX/ -- Capital One Financial Corporation (NYSE: COF) today announced that its fully diluted earnings per share for the first quarter of 2004 increased by 36 percent over the first quarter of 2003. The company has left unchanged its 2004 earnings guidance of $5.30 to $5.60 per share (fully diluted).

Earnings for the first quarter of 2004 were $450.8 million, or $1.84 per share (fully diluted), compared with earnings of $308.5 million, or $1.35 per share, for the first quarter of 2003 and $265.7 million, or $1.11 per share, in the previous quarter.

"We are pleased to report record earnings in the first quarter, which reflects strong credit performance and increased profitability of our diversified businesses," said Richard D. Fairbank, Capital One's Chairman and Chief Executive Officer. "We expect that the pattern of earnings reported this year will be similar to that of last year, starting with the highest earnings in the first quarter and moderating earnings as the year progresses."

During the first quarter of 2004, Capital One grew its managed loan portfolio by $572.1 million to $71.8 billion. The managed charge-off rate declined to 4.83 percent in the first quarter of 2004, from 5.32 percent in the previous quarter and 6.47 percent in the first quarter of 2003. The managed delinquency rate (30+ days) declined to 3.80 percent as of March 31, 2004 from 4.46 percent as of the end of the previous quarter and 4.97 percent as of March 31, 2003.

The company continues to diversify its portfolio and earnings beyond U.S. credit cards and shift its product mix upmarket. As a result, Capital One's managed revenue margin declined to 13.38 percent in the first quarter of 2004 from 13.89 percent in the previous quarter and 15.70 percent in the first quarter of 2003. As the company continues its asset diversification and its shift upmarket, management expects revenue margins to continue to trend somewhat lower in 2004. At the same time, declining credit losses and other expenses are expected to leave the company's return on managed assets relatively stable for the full year of 2004 as compared with 2003. The company expects its charge-off rate for the remaining three quarters of 2004 to be between four and five percent.

"The decline in the managed delinquency rate (30+ days) to 3.80 percent at the end of the first quarter from 4.46 percent the end of the previous quarter is a key driver of our reduced provisioning expense," said Gary L. Perlin, Capital One's Chief Financial Officer. "This decline, along with our expectation of little to no growth in the subprime portion of the company's credit card portfolio, leads us to expect that our allowance for loan losses will continue to move somewhat lower in the near term."

The company generates earnings from its managed loan portfolio, which includes both on-balance sheet loans and securitized 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" below for more information.

The company cautions that its current expectations in this release, in the presentation slides available on the company's website (www.capitalone.com), and on its Form 10-K for the fiscal year ended December 31, 2003, for 2004 earnings, charge-off rates, revenue margins, allowance for loan losses, loan growth, and the composition of loan growth 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; and general economic conditions affecting consumer income and spending, which may affect consumer bankruptcies, defaults, and charge-offs.

A discussion of these and other factors can be found in Capital One's annual report and other reports filed with the Securities and Exchange Commission, including, but not limited to, Capital One's report on Form 10-K for the fiscal year ended December 31, 2003.

About Capital One

Headquartered in McLean, Virginia, Capital One Financial Corporation (www.capitalone.com) is a holding company whose principal subsidiaries, Capital One Bank and Capital One, F.S.B., offer consumer lending products and Capital One Auto Finance, Inc., offers automobile and other motor vehicle financing products. Capital One's subsidiaries collectively had 46.7 million managed accounts and $71.8 billion in managed loans outstanding as of March 31, 2004. Capital One, a Fortune 500 company, is one of the largest providers of MasterCard and Visa credit cards in the world. Capital One trades on the New York Stock Exchange under the symbol "COF" and is included in the S&P 500 index.

NOTE: First quarter 2004 financial results, SEC Filings, and first quarter earnings conference call slides are accessible on Capital One's home page (www.capitalone.com). Choose "Investors" under "Company Information" on the left side of the page to view and download the earnings press release, slides, and other financial information. Additionally, a webcast of today's 5:00 p.m. (EDT) earnings conference call is accessible through the same link.



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

                                             2004         2003        2003
    (in millions, except per share data
     and as noted)                            Q1           Q4          Q1

    Earnings (Reported Basis)
    Net Interest Income                     $732.0       $664.1      $734.8
    Non-Interest Income                    1,443.1      1,437.5     1,304.6
    Total Revenue(1)                       2,175.1      2,101.6     2,039.4
    Provision for Loan Losses                243.7        390.4       375.9
    Marketing Expenses                       255.1        290.1       241.7
    Operating Expenses                       969.7        999.3       932.2
    Income Before Taxes and Accounting
     Change                                  706.6        421.7       489.6
    Tax Rate                                  36.2 %       37.0 %      37.0 %
    Cumulative Effect of Accounting
     Change, net of tax(2)                       -            -           -
    Net Income                              $450.8       $265.7      $308.5

    Common Share Statistics
    Basic EPS                                $1.94        $1.16       $1.38
    Diluted EPS                              $1.84        $1.11       $1.35
    Dividends Per Share                      $0.03        $0.03       $0.03
    Book Value Per Share (period end)       $28.54       $25.75      $21.78
    Stock Price Per Share (period end)      $75.43       $61.29      $30.01
    Total Market Capitalization
     (period end)                        $18,084.9    $14,405.7    $6,791.8
    Shares Outstanding (period end)          239.8        235.0       226.3
    Shares Used to Compute Basic EPS         232.0        228.1       223.0
    Shares Used to Compute Diluted EPS       245.4        239.2       228.4

    Reported Balance Sheet Statistics
     (period avg.)
    Average Loans                          $32,878      $31,297     $27,316
    Average Earning Assets                 $44,112      $40,792     $34,144
    Average Assets                         $47,699      $45,002     $38,318
    Average Equity                          $6,443       $5,887      $4,823
    Return on Average Assets (ROA)            3.78 %       2.36 %      3.22 %
    Return on Average Equity (ROE)           27.99 %      18.05 %     25.59 %

    Reported Balance Sheet Statistics
     (period end)
    Loans                                  $33,172      $32,850     $27,634
    Total Assets                           $49,146      $46,284     $37,911
    Capital(3)                              $7,675       $6,882      $5,749
    Loan growth                               $321       $2,232        $290
    % Loan Growth Q Over Q (annualized)          4 %         29 %         4 %
    % Loan Growth Y Over Y                      20 %         20 %        15 %
    Capital to Assets Ratio                  15.62 %      14.87 %     15.16 %
    Capital plus Allowance to Assets
     Ratio                                   18.66 %      18.31 %     19.48 %

    Revenue & Expense Statistics
     (Reported)
    Net Interest Income Growth
     (annualized)                               41 %        (23)%         2 %
    Non Interest Income Growth
     (annualized)                                2 %         22 %        (5)%
    Revenue Growth (annualized)                 14 %          7 %        (2)%
    Net Interest Margin                       6.64 %       6.51 %      8.61 %
    Revenue Margin                           19.72 %      20.61 %     23.89 %
    Risk Adjusted Margin(4)                  16.62 %      17.02 %     18.49 %
    Loan Revenue Margin(5)                   26.44 %      26.78 %     29.73 %
    Loan Risk Adjusted Margin(6)             22.27 %      22.10 %     22.97 %
    Operating Expense as a % of Revenues     44.58 %      47.55 %     45.71 %
    Operating Expense as a % of Avg
     Loans (annualized)                      11.80 %      12.77 %     13.65 %

    Asset Quality Statistics (Reported)
    Allowance                               $1,495       $1,595      $1,635
    30+ Day Delinquencies                   $1,266       $1,573      $1,490
    Net Charge-Offs                           $342         $366        $462
    Allowance as a % of Reported Loans        4.51 %       4.86 %      5.92 %
    Delinquency Rate (30+ days)               3.82 %       4.79 %      5.39 %
    Net Charge-Off Rate                       4.17 %       4.68 %      6.76 %


    (1) 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 2004 - $258.9
        million, Q4 2003 - $454.8 million, Q3 2003 - $481.0 million,
        Q2 2003 - $497.3 million, and Q1 2003 - $519.7 million.

    (2) Net charge from the adoption of FASB Interpretation No. 46,
        Consolidation of Variable Interest Entities.

    (3) Includes preferred interests and mandatory convertible securities.

    (4) Risk adjusted margin is total revenue less net charge-offs as a
        percentage of average earning assets.

    (5) Loan revenue margin is total loan revenue, loan interest income less
        interest expense plus non-interest income, as a percent of average
        loans outstanding for the period.  Loan interest expense is calculated
        using the cost of funds rate applied to the average consumer loan
        balance.

    (6) Loan risk adjusted margin is total loan revenue, loan net interest
        income and non-interest income, less net charge-offs as a percentage
        of average loans outstanding for the period.

    Note:  Additional historical financial and statistical information can be
           found on Capital One's home page (http://www.capitalone.com).
           Choose "Investors" under "Company Information" on the left
           side of the page to view and download the earnings press
           release.



    CAPITAL ONE FINANCIAL CORPORATION (COF)
    FINANCIAL & STATISTICAL SUMMARY MANAGED BASIS(1)

                                              2004        2003        2003
    (in millions, except per share
     data and as noted)                        Q1          Q4          Q1

    Earnings (Managed Basis)
    Net Interest Income                    $1,677.1    $1,571.7    $1,508.0
    Non-Interest Income                     1,014.5     1,077.5     1,027.9
    Total Revenue(2)                        2,691.6     2,649.2     2,535.9
    Provision for Loan Losses                 760.1       938.0       872.3
    Marketing Expenses                        255.1       290.1       241.7
    Operating Expenses                        969.7       999.3       932.2
    Income Before Taxes and
     Accounting Change                        706.6       421.7       489.6
    Tax Rate                                   36.2 %      37.0 %      37.0 %
    Cumulative Effect of Accounting
     Change, net of tax(3)                        -           -           -
    Net Income                               $450.8      $265.7      $308.5

    Managed Balance Sheet Statistics
     (period avg.)
    Average Loans                           $71,148     $68,679     $59,250
    Average Earning Assets                  $80,495     $76,277     $64,602
    Average Assets                          $85,324     $81,733     $69,670
    Return on Average Assets (ROA)             2.11 %      1.30 %      1.77 %

    Managed Balance Sheet Statistics
     (period end)
    Loans                                   $71,817     $71,245     $59,214
    Total Assets                            $87,197     $83,999     $68,927
    Loan Growth                                $572      $3,985       $(533)
    % Loan Growth Q over Q (annualized)           3 %        24 %        (4)%
    % Loan Growth Y over Y                       21 %        19 %        22 %
    Capital to Assets Ratio                    8.80 %      8.19 %      8.34 %
    Capital plus Allowance to
     Assets Ratio                             10.52 %     10.09 %     10.71 %
    Number of Accounts (000's)               46,712      47,038      46,423
    % Off-Balance Sheet Securitizations          53 %        53 %        53 %
    % at Introductory Rate                        8 %        10 %         9 %

    Revenue & Expense Statistics (Managed)
    Net Interest Income Growth
     (annualized)                                27 %        19 %        18 %
    Non Interest Income Growth
     (annualized)                               (23)%        11 %       (22)%
    Revenue Growth (annualized)                   6 %        16 %         1 %
    Net Interest Margin                        8.33 %      8.24 %      9.34 %
    Revenue Margin                            13.38 %     13.89 %     15.70 %
    Risk Adjusted Margin(4)                    9.11 %      9.10 %      9.77 %
    Loan Revenue Margin(5)                    15.26 %     15.54 %     17.20 %
    Loan Risk Adjusted Margin(6)              10.43 %     10.22 %     10.73 %
    Operating Expense as a % of Revenues      36.03 %     37.72 %     36.76 %
    Operating Expense as a % of Avg Loans
     (annualized)                              5.45 %      5.82 %      6.29 %

    Asset Quality Statistics (Managed)
    30+ Day Delinquencies                    $2,731      $3,178      $2,942
    Net Charge-Offs                            $859        $914        $958
    Delinquency Rate (30+ days)                3.80 %      4.46 %      4.97 %
    Net Charge-Off Rate                        4.83 %      5.32 %      6.47 %

    (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) 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 2004 - $258.9 million, Q4 2003 -
        $454.8 million, Q3 2003 - $481.0 million, Q2 2003 - $497.3 million,
        and Q1 2003 - $519.7 million.

    (3) Net charge from the adoption of FASB Interpretation No. 46,
        Consolidation of Variable Interest Entities.

    (4) Risk adjusted margin is total revenue less net charge-offs as a
        percentage of average earning assets.

    (5) Loan revenue margin is total loan revenue, loan interest income less
        interest expense plus non-interest income, as a percent of average
        loans outstanding for the period.  Loan interest expense is calculated
        using the cost of funds rate applied to the average consumer loan
        balance.

    (6) Loan risk adjusted margin is total loan revenue, loan net interest
        income and non-interest income, less net charge-offs as a percentage
        of average loans outstanding for the period.

    Note:  Additional historical financial and statistical information can be
           found on Capital One's home page (http://www.capitalone.com).
           Choose "Investors" under "Company Information" on the left
           side of the page to view and download the earnings press release.



    CAPITAL ONE FINANCIAL CORPORATION (COF)
    SEGMENT FINANCIAL & STATISTICAL  SUMMARY - MANAGED BASIS(1)

                                             2004        2003        2003
    (in millions, except per share data
     and as noted)                            Q1          Q4          Q1

    Segment Statistics
    US Card:
      Loans receivable                     $45,298     $46,279     $38,737
      Net income (loss)                     $386.8      $322.7      $308.1
      Net charge-off rate                     5.41 %      6.16 %      7.72 %
      Delinquency Rate (30+ days)             3.99 %      4.60 %      5.55 %
    Auto Finance:
      Loans receivable                      $8,834      $8,467      $7,742
      Net income (loss)                      $30.7       $34.4       $(6.5)
      Net charge-off rate                     4.13 %      4.30 %      4.91 %
      Delinquency Rate (30+ days)             5.44 %      7.55 %      5.37 %
    Global Financial Services:
      Loans receivable                     $17,643     $16,508     $12,726
      Net income (loss)                      $50.9        $3.3       $14.9
      Net charge-off rate                     3.60 %      3.69 %      3.95 %
      Delinquency Rate (30+ days)             2.63 %      2.70 %      2.98 %

    (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".

    Note:  Additional historical financial and statistical information can be
           found on Capital One's home page (http://www.capitalone.com).
           Choose "Investors" under "Company Information" on the left
           side of the page to view and download the earnings press release.



    CAPITAL ONE FINANCIAL CORPORATION
    Reconciliation to GAAP Financial Measures
    For the Three Months Ended March 31, 2004
    (dollars in thousands)(unaudited)

The Company's consolidated financial statements prepared in accordance with generally accepted accounting principles ("GAAP") are referred to as its "reported" financial statements. Loans included in securitization transactions which qualified as sales under GAAP have been removed from the Company's "reported" balance sheet. However, interest income, interchange, fees and recoveries generated from the securitized loan portfolio net of charge-offs in excess of the interest paid to investors of asset-backed securitizations are recognized as non-interest income on the "reported" income statement.

The Company's "managed" consolidated financial statements add back the 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 non-interest income generated from the securitized portfolio and distributes the revenue 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                 $732,022      $945,056     $1,677,078
    Non-interest income               $1,443,134     $(428,598)    $1,014,536
    Total revenue                     $2,175,156      $516,458     $2,691,614
    Provision for loan losses           $243,668      $516,458       $760,126
    Net charge-offs                     $342,391      $516,458       $858,849

    Balance Sheet Measures
    Consumer loans                   $33,171,516   $38,645,386    $71,816,902
    Total assets                     $49,146,425   $38,050,487    $87,196,912
    Average consumer loans           $32,877,525   $38,270,762    $71,148,287
    Average earning assets           $44,111,541   $36,383,693    $80,495,234
    Average total assets             $47,699,012   $37,625,031    $85,324,043
    Delinquencies                     $1,266,425    $1,464,913     $2,731,338

    (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
                                             2004         2003         2003

    Assets:
    Cash and due from banks                $323,346     $382,212     $328,791
    Federal funds sold and resale
     agreements                           1,257,666    1,010,319      864,036
    Interest-bearing deposits at
     other banks                            188,237      587,751      247,560
      Cash and cash equivalents           1,769,249    1,980,282    1,440,387
    Securities available for sale         9,149,440    5,866,628    4,817,322
    Consumer loans                       33,171,516   32,850,269   27,634,440
      Less:  Allowance for
       loan losses                       (1,495,000)  (1,595,000)  (1,635,000)
    Net loans                            31,676,516   31,255,269   25,999,440
    Accounts receivable from
     securitizations                      4,008,809    4,748,962    3,378,593
    Premises and equipment, net             898,802      902,600      769,112
    Interest receivable                     236,852      214,295      208,998
    Other                                 1,406,757    1,315,670    1,297,115
      Total assets                      $49,146,425  $46,283,706  $37,910,967


    Liabilities:
    Interest-bearing deposits           $23,610,851  $22,416,332  $18,489,388
    Senior and subordinated notes         7,224,798    7,016,020    5,116,591
    Other borrowings                      8,254,383    7,796,613    6,576,876
    Interest payable                        245,172      256,015      194,629
    Other                                 2,968,993    2,746,915    2,604,818
      Total liabilities                  42,304,197   40,231,895   32,982,302

    Stockholders' Equity:
    Common stock                              2,411        2,364        2,275
    Paid-in capital, net                  2,218,861    1,937,302    1,730,883
    Retained earnings and cumulative
     other comprehensive income           4,670,384    4,161,666    3,244,673
      Less:  Treasury stock, at cost        (49,428)     (49,521)     (49,166)
      Total stockholders' equity          6,842,228    6,051,811    4,928,665
      Total liabilities and
       stockholders' equity             $49,146,425  $46,283,706  $37,910,967



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


                                              Three months ended
                                             March 31  December 31  March 31
                                               2004       2003        2003

    Interest Income:
    Consumer loans, including
     past-due fees                          $1,035,017   $969,571  $1,013,282
    Securities available for sale               63,716     52,328      42,931
    Other                                       65,998     65,884      50,353
      Total interest income                  1,164,731  1,087,783   1,106,566

    Interest Expense:
    Deposits                                   239,512    237,624     209,308
    Senior and subordinated notes              130,515    123,409     104,097
    Other borrowings                            62,682     62,649      58,357
      Total interest expense                   432,709    423,682     371,762
    Net interest income                        732,022    664,101     734,804
    Provision for loan losses                  243,668    390,405     375,851
    Net interest income after provision
     for loan losses                           488,354    273,696     358,953

    Non-Interest Income:
    Servicing and securitizations              917,669    918,762     729,689
    Service charges and other customer-
     related fees                              354,493    380,925     441,226
    Interchange                                105,595    106,414      85,351
    Other                                       65,377     31,390      48,337
      Total non-interest income              1,443,134  1,437,491   1,304,603

    Non-Interest Expense:
    Salaries and associate benefits            424,392    408,884     398,467
    Marketing                                  255,147    290,145     241,696
    Communications and data processing         117,106    116,217     112,052
    Supplies and equipment                      88,321     83,804      83,812
    Occupancy                                   38,719     51,645      43,574
    Other                                      301,211    338,777     294,331
      Total non-interest expense             1,224,896  1,289,472   1,173,932
    Income before income taxes                 706,592    421,715     489,624
    Income taxes                               255,786    156,034     181,161
    Net income                                $450,806   $265,681    $308,463


    Basic earnings per share                     $1.94      $1.16       $1.38

    Diluted earnings per share                   $1.84      $1.11       $1.35

    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 3/31/04

                                              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      130,515    7.18%
     Other borrowings                        7,834,046       62,682    3.20%
    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%


    Reported                                       Quarter Ended 12/31/03

                                              Average      Income     Yield/
                                              Balance      Expense     Rate

    Earning assets:
     Consumer loans                        $31,297,123     $969,571   12.39%
     Securities available for sale           5,816,001       52,328    3.60%
     Other                                   3,679,088       65,884    7.16%
    Total earning assets                   $40,792,212   $1,087,783   10.67%

    Interest-bearing liabilities:
     Deposits                              $21,604,968     $237,624    4.40%
     Senior and subordinated notes           6,734,569      123,409    7.33%
     Other borrowings                        7,661,016       62,649    3.27%
    Total interest-bearing liabilities     $36,000,553     $423,682    4.71%

    Net interest spread                                                5.96%

    Interest income to average
     earning assets                                                    10.67%
    Interest expense to average
     earning assets                                                    4.16%
    Net interest margin                                                6.51%


    Reported                                       Quarter Ended 3/31/03

                                              Average      Income     Yield/
                                              Balance      Expense     Rate

    Earning assets:
     Consumer loans                        $27,316,194   $1,013,282   14.84%
     Securities available for sale           4,417,538       42,931    3.89%
     Other                                   2,410,750       50,353    8.35%
    Total earning assets                   $34,144,482   $1,106,566   12.96%

    Interest-bearing liabilities:
     Deposits                              $17,940,058     $209,308    4.67%
     Senior and subordinated notes           5,309,690      104,097    7.84%
     Other borrowings                        7,009,915       58,357    3.33%
    Total interest-bearing liabilities     $30,259,663     $371,762    4.91%

    Net interest spread                                                8.05%

    Interest income to average
     earning assets                                                   12.96%
    Interest expense to average
     earning assets                                                    4.35%
    Net interest margin                                                8.61%



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

    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       130,515   7.18%
      Other borrowings                        7,834,046        62,682   3.20%
      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%


    Managed(1)                                      Quarter Ended 12/31/03

                                              Average       Income     Yield/
                                              Balance       Expense     Rate
    Earning assets:
      Consumer loans                        $68,678,877    $2,295,802  13.37%
      Securities available for sale           5,816,001        52,328   3.60%
      Other                                   1,782,263        11,326   2.54%
    Total earning assets                    $76,277,141    $2,359,456  12.37%

    Interest-bearing liabilities:
      Deposits                              $21,604,968      $237,624   4.40%
      Senior and subordinated notes           6,734,569       123,409   7.33%
      Other borrowings                        7,661,016        62,649   3.27%
      Securitization liability               36,766,829       364,092   3.96%
    Total interest-bearing liabilities      $72,767,382      $787,774   4.33%

    Net interest spread                                                 8.04%

    Interest income to average
     earning assets                                                    12.37%
    Interest expense to average
     earning assets                                                     4.13%
    Net interest margin                                                 8.24%


    Managed(1)                                      Quarter Ended 3/31/03

                                              Average       Income     Yield/
                                              Balance       Expense     Rate
    Earning assets:
      Consumer loans                        $59,249,698    $2,148,419  14.50%
      Securities available for sale           4,417,538        42,931   3.89%
      Other                                     934,382         5,323   2.28%
    Total earning assets                    $64,601,618    $2,196,673  13.60%

    Interest-bearing liabilities:
      Deposits                              $17,940,058      $209,308   4.67%
      Senior and subordinated notes           5,309,690       104,097   7.84%
      Other borrowings                        7,009,915        58,357   3.33%
      Securitization liability               31,361,051       316,960   4.04%
    Total interest-bearing liabilities      $61,620,714      $688,722   4.47%

    Net interest spread                                                 9.13%

    Interest income to average
     earning assets                                                    13.60%
    Interest expense to average
     earning assets                                                     4.26%
    Net interest margin                                                 9.34%


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

SOURCE Capital One Financial Corporation

Paul Paquin, V.P., Investor Relations, +1-703-720-2456, or
Tatiana Stead, Director, Corporate Media, +1-703-720-2352, both of Capital One
Financial Corporation

http://www.capitalone.com