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Capital One Reports Fourth Quarter Earnings

January 23, 2008 at 4:07 PM EST
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MCLEAN, Va., Jan. 23 /PRNewswire-FirstCall/ -- Capital One Financial Corporation (NYSE: COF) today announced earnings for 2007 of $1.6 billion, or $3.97 per share (diluted). Earnings from continuing operations for the full year were $2.6 billion or $6.55 per share (diluted), versus the prior year's $2.4 billion, or $7.65 earnings per share (diluted). Net income for the fourth quarter of 2007 was $226.6 million, or $0.60 earnings per share (diluted). Fourth quarter 2007 earnings from continuing operations were $321.6 million, or $0.85 earnings per share (diluted) compared to $402.6 million, or $1.17 earnings per share (diluted) in the fourth quarter of 2006. These results are consistent with those reported by the company on January 10, 2008 and provide additional information regarding segment performance.

Earnings from continuing operations excludes the loss from discontinued operations related to the shutdown of GreenPoint Mortgage, announced in August 2007, of $0.25 per share (diluted) for the fourth quarter of 2007 and $2.58 per share (diluted) for full year 2007.

"As the economy has weakened, we have selectively pulled back loan growth and maintained appropriately conservative underwriting standards," said Richard D. Fairbank, Capital One's Chairman and Chief Executive Officer. "We feel confident that our strong balance sheet, resilient businesses, and decisive actions will allow us to successfully navigate the cyclical economic weakness and we remain poised to generate above average returns on the other side of the cycle."

Total Company Results

  • Managed loans held for investment at the end of 2007 were $151.4 billion, up $5.2 billion or 3.6 percent over the end of 2006. Increases during the year came primarily in the Auto and Global Financial Services portfolios. Managed loans increased from the third quarter of 2007 by $6.6 billion, or 4.6 percent, driven largely by seasonal growth in U.S. Card and Auto. The company expects managed loan growth in the low single digits in 2008.
  • Total managed revenue was up 5.7 percent relative to the third quarter of 2007, driven largely by revenue margin expansion and seasonal loan growth in our U.S. Card portfolio. The company expects 2008 revenue growth to be in the low single digits.
  • On a managed basis, the fourth quarter 2007 provision for loan losses was approximately $1.9 billion. This was comprised of approximately $1.3 billion in charge-offs and an allowance build of approximately $650 million. The allowance is driven by the loss outlook at year-end which reflects fourth quarter credit metrics and a recognition of the weakening trends in the U.S. economy as the company entered 2008.
  • Fourth quarter operating expenses of $1.7 billion included approximately $140 million of legal liabilities and reserves. Full year 2007 operating expenses were $6.6 billion, leading to an efficiency ratio of 47 percent. The company expects its 2008 operating expenses to be at least $200 million below 2007, leading to an efficiency ratio in the mid-forty percent range for 2008.
  • Total deposits of $83.0 billion at the end of the fourth quarter of 2007 were essentially flat with the previous quarter.

"The company ended 2007 with a year-end ratio of tangible common equity (TCE) to tangible managed assets of 5.8 percent. In the current environment we intend, through internal capital generation, to manage toward the high end or above our target range of 5.5 - 6.0 percent," said Gary L. Perlin, Capital One's Chief Financial Officer. "We will maintain our strong liquidity position and continue to take actions to sustain profitability through the cycle."

Segment Results

National Lending Segment

  • Profits for the National Lending segment were up $59.8 million as compared to the fourth quarter of 2006, driven by increased profits in U.S. Card and Global Financial Services.
  • The managed charge-off rate for the National Lending segment in the fourth quarter of 2007 was 4.73 percent versus 3.96 percent in the third quarter of 2007 and 3.63 percent in the fourth quarter of 2006. The delinquency rate of 5.17 percent for National Lending increased from 4.70 percent at the end of the third quarter and 4.09 percent as of December 31, 2006. Credit metrics have risen year over year due to credit normalization, secondary effects of changes to pricing and fee policies in U.S. Card, and deterioration in the company's U.S. consumer loan portfolio due to weakening in the U.S. economy.
  • U.S. Card highlights

  • U.S. Card reported record net income for 2007 of $2.1 billion, versus $1.8 billion in 2006. Fourth quarter net income was $521.9 million, a 54.8 percent increase, year over year as revenue growth and expense reductions more than offset increased charge-offs and allowance build.
  • Revenues increased 27.2 percent from the fourth quarter of 2006 largely as a result of pricing changes implemented in some of the company's products after completion of the card holder system conversion.
  • Non-interest expenses decreased 6.1 percent to $3.3 billion in 2007 from $3.5 billion in 2006. Non-interest expenses in the fourth quarter of 2007 were relatively flat compared to the third quarter of 2007.
  • Managed loans at the end of 2007 were $52.1 billion, a decline of 2.9 percent from the end of 2006, and an increase of 5.1 percent from the end of the third quarter of 2007. The year over year decline was a result of a reduction in the marketing of teaser rate offers in the prime market and a $600.0 million portfolio sale in the first quarter of 2007. The increase in managed loans relative to the third quarter was due primarily to seasonality.
  • Charge-offs rose in the fourth quarter of 2007 to 5.40 percent from 3.82 percent in the fourth quarter of 2006, and delinquencies rose to 4.95 percent from 3.74 percent. The increases resulted from continued normalization of consumer credit, pull-back from the prime revolver market throughout the year, impacts of U.S. Card's pricing and fee policy changes made in the second and third quarters, and economic weakening evidenced in recently released economic indicators. In addition, credit metrics in the fourth quarter of 2007 reflect expected seasonal patterns on a sequential quarter basis. The company expects the U.S. Card managed charge-off rate to be in the mid-6 percent range in the first half of 2008.
  • Auto Finance highlights

  • Auto Finance reported a net loss for 2007 of $33.8 million, versus net income of $233.5 million in 2006. In the fourth quarter of 2007, Auto posted a net loss of $112.4 million, primarily due to the effects of credit worsening.
  • Increases in charge-off and delinquency rates were a result of expected seasonal patterns, credit normalization and weakening in the U.S. economy. While the company increased its pricing and tightened credit standards in the fourth quarter of 2007, the reduction in competitive intensity allowed the company to originate $3.6 billion of high quality loans, up 11.5 percent, compared to the third quarter of 2007.
  • Tightened underwriting and increased prices implemented in the fourth quarter have resulted in better credit profiles and higher pricing on the portfolio. An intended effect of the tightened underwriting has been to reduce the amount of originations. In 2008, the company expects to further reduce originations and focus its dealer prime business on a much smaller network of dealers.
  • On January 1, 2008, the company moved Capital One Auto Finance Company ("COAF"), a previously wholly owned finance company subsidiary of Capital One Financial Corporation to become a direct operating subsidiary of Capital One, N.A., a wholly owned banking subsidiary. This legal entity restructuring enhances the holding company's liquidity profile and COAF's funding flexibility.
  • Global Financial Services (GFS) highlights

  • GFS reported net income for 2007 of $299.4 million, versus $273.9 million in 2006. Fourth quarter 2007 net income was $23.3 million, a $21.2 million increase over last year's fourth quarter driven by higher revenue margin and lower operating expenses offset by higher provision expense. The reduction in net income relative to the prior quarter was primarily driven by an increase in provision expense.
  • Managed loans grew 8.6 percent, to $29.3 billion during 2007 with growth from North American businesses more than offsetting a modest decline in loans in the UK.
  • Strong credit results in the Canadian credit card business and stable and improving credit performance in the UK muted worsening credit trends in the domestic GFS businesses for 2007.
  • Local Banking Segment highlights

  • Net income of $111.8 million in the fourth quarter of 2007 was down $78.8 million over the third quarter, due primarily to the third quarter including a release in reserves that resulted from aligning the Banking segment's allowance methodologies with the company's methodology.
  • Loans held for investment grew $1.7 billion from the third quarter of 2007 to $44.0 billion primarily from the addition of GreenPoint Mortgage loans and increased commercial loan production. Total Bank deposits grew $305.2 million to $73.3 billion.
  • The charge-off rate was 28 basis points in the fourth quarter of 2007 compared to 19 basis points in the third quarter, and non-performing loans were 41 basis points at December 31, 2007 compared to 27 basis points at September 30, 2007. While losses remain at very low levels, during the quarter the Bank experienced charge-off increases in its Consumer Real Estate portfolio and Unsecured Lending.
  • Integration efforts continue to be on track with the brand conversion and deposit platform conversion scheduled for the first quarter.
  • 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.

    Forward looking statements

    The company cautions that its current expectations in this release, in the presentation slides available on the company's website and in its Form 8-K dated January 23, 2008, for 2008 revenue growth, managed growth, operating efficiencies, operating expense reductions, the expected managed charge-off rate for U.S. Card for the first half of 2008, and estimated loss levels for the twelve months ending December 31, 2008 underlying its provision expenses in the fourth quarter of 2007, and the 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: general economic and business conditions in the U.S. and or the UK, including conditions affecting employment levels, interest rates, consumer income, spending, and savings that may affect consumer bankruptcies, defaults, charge-offs and deposit activity; changes in the credit environment in the U.S. and or the UK; continued intense competition from numerous providers of products and services that compete with Capital One's businesses; changes in our aggregate accounts and balances, and the growth rate and composition thereof; the company's ability to execute on its strategic and operational plans; the risk that the company's acquired businesses will not be integrated successfully and that the cost savings and other synergies from such acquisitions may not be fully realized; the risk that the benefits of the company's restructuring initiative, including cost savings and other benefits, may not be fully realized; the success of the company's marketing efforts; general conditions in the wholesale funding markets; and general market conditions in the mortgage industry. 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, 2006, and reports on Form 10-Q and 10-Q/A for the quarters ended March 31, 2007, June 30, 2007 and September 30, 2007.

    About Capital One

    Capital One Financial Corporation (www.capitalone.com) is a financial holding company whose subsidiaries collectively had $83.0 billion in deposits and $151.4 billion in managed loans outstanding as of December 31, 2007. Headquartered in McLean, VA, Capital One has 742 locations in New York, New Jersey, Connecticut, Texas and Louisiana. It is a diversified financial services company whose principal subsidiaries, Capital One, N.A., Capital One Bank, and Capital One Auto Finance, Inc., offer a broad spectrum of financial products and services to consumers, small businesses and commercial clients. A Fortune 500 company, Capital One trades on the New York Stock Exchange under the symbol "COF" and is included in the S&P 100 index.

    NOTE: Fourth quarter 2007 financial results, SEC Filings, and fourth quarter earnings conference call slides are accessible on Capital One's home page (www.capitalone.com). Choose "Investors" on the bottom 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 (ET) earnings conference call is accessible through the same link.



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

    (in millions, except per          2007             2007           2006
      share data and as noted)         Q4               Q3(13)         Q4

    Earnings (Reported Basis)
    Net Interest Income            $  1,762.3      $  1,624.5    $  1,393.0
    Non-Interest Income               2,158.3 (12)    2,149.7       1,671.5
    Total Revenue (1)                 3,920.6         3,774.2       3,064.5
    Provision for Loan Losses         1,294.2           595.5         513.2
    Marketing Expenses                  358.2           332.7         395.4
    Restructuring Expenses (2)           27.8            19.4           -
    Operating Expenses                1,749.2 (3),(4) 1,582.2 (3)   1,567.3
    Income Before Taxes                 491.2         1,244.4         588.6
    Tax Rate (5)                         34.5 %          34.4 %        31.6 %
    Income From Continuing
     Operations, Net of Tax        $   321.6       $    816.4     $   402.6
    Loss From Discontinued
     Operations, Net of Tax (6)        (95.0)          (898.0)        (11.9)
    Net Income (Loss)              $    226.6      $    (81.6)    $   390.7

    Common Share Statistics
    Basic EPS:
       Income From Continuing
        Operations                 $     0.85      $     2.11     $    1.20
       Loss From Discontinued
        Operations                 $    (0.25)     $    (2.32)    $   (0.04)
       Net Income (Loss)           $     0.60      $    (0.21)    $    1.16
    Diluted EPS:
       Income From Continuing
        Operations                 $     0.85      $     2.09     $    1.17
       Loss From Discontinued
        Operations                 $    (0.25)     $    (2.30)    $   (0.03)
       Net Income (Loss)           $     0.60      $    (0.21)    $    1.14
    Dividends Per Share            $     0.03      $     0.03     $    0.03
    Tangible Book Value Per Share
     (period end)                  $    29.02      $    28.88     $   27.95
    Stock Price Per Share (period
     end)                          $    47.26      $    66.43     $   76.82
    Total Market Capitalization
     (period end)                  $ 17,613.8      $ 25,602.1     $31,488.5
    Shares Outstanding (period
     end)                               372.7           385.4         409.9
    Shares Used to Compute Basic
     EPS                                375.6           386.1         336.5
    Shares Used to Compute
     Diluted EPS                        378.4           390.8         343.8

    Reported Balance Sheet
     Statistics (period average) (7)
    Average Loans Held for
     Investment                    $   97,785       $  91,745     $  74,738
    Average Earning Assets         $  127,242       $ 118,354     $  97,849
    Average Assets                 $  150,926       $ 143,291     $ 111,440
    Average Interest Bearing
     Deposits                      $   72,312       $  73,555     $  53,735
    Total Average Deposits         $   84,051       $  84,884     $  60,382
    Average Equity                 $   24,733       $  25,344     $  18,311
    Return on Average Assets
     (ROA)                               0.85 %          2.28 %        1.45 %
    Return on Average Equity
     (ROE)                               5.20 %         12.89 %        8.79 %

    Reported Balance Sheet
     Statistics (period end) (7)
    Loans Held for Investment      $  101,805       $  93,789     $  96,512
    Total Assets                   $  150,202       $ 143,884     $ 144,361
    Interest Bearing Deposits      $   71,944       $  72,503     $  74,123
    Total Deposits                 $   82,990       $  83,343     $  85,771

    Performance Statistics
     (Reported) (7)
    Net Interest Income Growth
     (annualized)                        34 %            22 %          30 %
    Non Interest Income Growth
     (annualized)                         2 %            36 %         (20)%
    Revenue Growth (annualized)          16 %            30 %           1 %
    Net Interest Margin                5.54 %          5.49 %        5.69 %
    Revenue Margin                    12.32 %         12.76 %       12.53 %
    Risk Adjusted Margin (8)          10.28 %         11.13 %       10.72 %
    Non Interest Expense as a %
     of Average Loans Held for
     Investment (annualized)           8.73 %          8.43 %       10.50 %
    Efficiency Ratio (9)              53.75 %         50.74 %       64.05 %

    Asset Quality Statistics
     (Reported) (7)
    Allowance                      $  2,963          $2,237       $ 2,180
    Allowance as a % of Reported
     Loans Held for Investment         2.91 %          2.39 %        2.26 %
    Net Charge-Offs                $    650          $  480       $   443
    Net Charge-Off Rate                2.66 %          2.09 %        2.37 %
    Full-time equivalent
     employees (in thousands)          27.0            27.5          31.1



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

                                      2007            2007         2006
    (in millions)                      Q4              Q3(13)       Q4
    Earnings (Managed Basis)
    Net Interest Income           $  3,000.5      $  2,803.4   $  2,339.1
    Non-Interest Income              1,566.2 (12)    1,518.0      1,210.3
    Total Revenue (1)                4,566.7         4,321.4      3,549.4
    Provision for Loan Losses        1,940.3         1,142.7        998.1
    Marketing Expenses                 358.2           332.7        395.4
    Restructuring Expenses (2)          27.8            19.4          -
    Operating Expenses               1,749.2 (3),(4) 1,582.2 (3)  1,567.3
    Income Before Taxes                491.2         1,244.4        588.6
    Tax Rate (5)                        34.5 %          34.4%       31.6 %
    Income From Continuing
     Operations, Net of Tax        $   321.6      $    816.4    $   402.6
    Loss From Discontinued
     Operations, Net of Tax (6)        (95.0)         (898.0)       (11.9)
    Net Income (Loss)              $   226.6      $    (81.6)   $   390.7

    Managed Balance Sheet
     Statistics (period average) (7)
    Average Loans Held for
     Investment                    $ 148,362      $  143,781   $  123,902
    Average Earning Assets         $ 175,652      $  168,238   $  145,113
    Average Assets                 $ 200,658      $  194,528   $  159,947
    Return on Average Assets
     (ROA)                              0.64 %          1.68 %       1.01 %

    Managed Balance Sheet
     Statistics (period end) (7)
    Loans Held for Investment      $  151,362     $  144,769   $  146,151
    Total Assets                   $  198,908     $  194,019   $  193,267
    Tangible Assets(10)            $  185,428     $  180,363   $  179,487
    Tangible Common Equity (11)    $   10,814     $   11,131   $   11,455
    Tangible Common Equity to
     Tangible Assets Ratio               5.83 %          6.17 %      6.38 %
    % Off-Balance Sheet
     Securitizations                       33 %            35 %        34 %

    Performance Statistics
     (Managed) (7)
    Net Interest Income Growth
     (annualized)                          28  %           29 %         22 %
    Non Interest Income Growth
     (annualized)                           13 %           38 %        (20)%
    Revenue Growth (annualized)             23 %           32 %          6 %
    Net Interest Margin                   6.83 %         6.67 %       6.45 %
    Revenue Margin                       10.40 %        10.27 %       9.78 %
    Risk Adjusted Margin (8)              7.45 %         7.83 %       7.23 %
    Non Interest Expense as a %
     of Average Loans Held for
     Investment (annualized)              5.76 %         5.38 %       6.34 %
    Efficiency Ratio (9)                 46.15 %        44.31 %      55.30 %

    Asset Quality Statistics
     (Managed) (7)
    Net Charge-Offs                  $   1,296       $  1,027      $   927
    Net Charge-Off Rate                   3.49 %         2.86 %       2.99 %


    (*) 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 (COF)
                    FINANCIAL & STATISTICAL SUMMARY NOTES

    (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: Q4 2007 - $379.4 million, Q3 2007 - $310.5
        million and Q4 2006 - $248.3 million.

    (2) During the second quarter of 2007, the Company announced a broad-based
        initiative to reduce expenses and improve its competitive cost
        position. As part of this initiative $27.8 million and $19.4 million
        of restructuring charges were recognized as part of continuing
        operations during Q4 2007 and Q3 2007, respectively.

    (3) Includes core deposit intangible amortization expense of $51.1 million
        in Q4 2007 and $52.4 million in Q3 2007, and integration costs of
        $28.6 million in Q4 2007 and $30.3 million in Q3 2007.

    (4) The Company recognized a pre-tax charge in the fourth quarter of
        approximately $80 million for liabilities in connection with the Visa
        antitrust lawsuit settlement with American Express.  Additionally, the
        company has initiated a legal reserve of approximately $60 million
        for estimated possible damages in connection with other pending Visa
        litigation, reflecting Capital One's share of such potential damages
        as a Visa member.

    (5) Includes miscellaneous tax adjustments of $28.8 million in Q4 2006.

    (6) In Q3 2007, the Company shutdown the mortgage origination operations
        of its wholesale mortgage banking unit, GreenPoint Mortgage, realizing
        an after-tax loss of $898.0 million.  The results of the mortgage
        origination operation of GreenPoint have been accounted for as a
        discontinued operation and have been removed from the Company's
        results of continuing operations for all periods presented. The
        results of GreenPoint's mortgage servicing business are reported in
        continuing operations for all periods presented. Effective Q4 2007,
        GreenPoint's held for investment commercial and consumer loan
        portfolio results are included in continuing operations.

    (7) Based on continuing operations.  Average equity and return on equity
        are based on the Company's stockholder's equity.

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

    (9) Efficiency ratio is Non-interest expense less restructuring expense
        divided by total revenue.

    (10) Tangible assets include managed assets less intangible assets.

    (11) Includes stockholders' equity and preferred interests less
         intangible assets and related deferred tax liability.  Tangible
         Common Equity on a reported and managed basis is the same.

    (12) During the fourth quarter 2007, the Company completed the sale of its
         interest in a relationship agreement to develop and market consumer
         credit products in the Spanish Market and recorded a gain related to
         this sale of approximately $30 million in non-interest income.

    (13) Certain prior period amounts have been reclassified to conform with
         current period presentation.


                   CAPITAL ONE FINANCIAL CORPORATION (COF)
      SEGMENT FINANCIAL & STATISTICAL SUMMARY FOR CONTINUING OPERATIONS
                              MANAGED BASIS (1)

                                         2007           2007           2006
    (in thousands)                        Q4             Q3 (7)        Q4

    Local Banking: (3)
      Interest Income                $  1,702,252   $  1,744,038  $    721,102
      Interest Expense                  1,119,738      1,161,758       476,523
      Net interest income            $    582,514   $   582,280   $    244,579
      Non-interest income                 192,342        195,204       112,021
      Provision for loan losses            42,665        (58,285)     (21,549)
      Other non-interest expenses         561,812        543,390       307,810
      Income tax provision                 58,610        101,783        24,619
      Net income                     $    111,769   $    190,596  $     45,720

      Loans Held for Investment      $ 43,972,795   $ 42,233,665  $ 12,145,533
      Average Loans Held for
       Investment                    $ 43,128,767   $ 41,992,618  $ 13,330,876
      Core Deposits(2)               $ 63,206,923   $ 62,712,373  $ 27,071,324
      Total Deposits                 $ 73,318,570   $ 73,013,351  $ 35,334,610

      Loans Held for Investment
       Yield                                7.02%         7.13%         7.98%
      Net Interest Margin - Loans
       (4)                                  1.87%         1.79%         3.21%
      Net Interest Margin - Deposits
       (5)                                  2.04%         2.08%         1.50%
      Efficiency Ratio (6)                 72.51%        69.89%        86.32%
      Net charge-off rate                   0.28%         0.19%         0.40%
      Non Performing Loans           $   178,385    $  112,794     $   57,824
      Non Performing Loans as a % of
       Loans Held for Investment            0.41%         0.27%         0.48%
      Non-Interest Expenses as a %
       of Average Loans Held for
       Investment                           5.21%         5.18%         9.24%

      Number of Active ATMs                 1,288         1,282           661
      Number of locations                     742           732           358


    National Lending:
      Interest Income               $   3,675,528  $  3,511,878   $  3,182,013
      Interest Expense                  1,235,080     1,232,115      1,163,106
      Net interest income           $   2,440,448  $  2,279,763   $  2,018,907
      Non-interest income               1,384,315     1,312,146      1,105,240
      Provision for loan losses         1,777,327     1,196,087      1,010,837
      Other non-interest expenses       1,389,840     1,367,607      1,534,523
      Income tax provision                224,802       352,847        205,768
      Net income                    $     432,794  $    675,368   $    373,019

      Loans Held for Investment     $ 106,508,443  $102,556,271   $102,359,180
      Average Loans Held for
       Investment                   $ 104,321,485  $101,805,584   $ 99,881,480
      Core Deposits(2)              $       1,599  $        470   $      6,061
      Total Deposits                $   2,050,861  $  2,295,131   $  2,383,902

      Loans Held for Investment
       Yield                               14.07%        13.77%         12.72%
      Net Interest Margin                   9.36%         8.96%          8.09%
      Revenue Margin                       14.67%        14.11%         12.51%
      Risk Adjusted Margin                  9.94%        10.15%          8.88%
      Non-Interest Expenses as a %
       of Average Loans Held for
       Investment                           5.33%         5.37%          6.15%
      Efficiency Ratio (6)                 36.34%        38.07%         49.12%
      Net charge-off rate                   4.73%         3.96%          3.63%
      Delinquency Rate (30+ days)           5.17%         4.70%          4.09%

      Number of Loan Accounts (000s)      48,537        48,473          49,374


    Other: (3
      Net interest income            $   (22,449)   $  (58,605)   $     75,586
      Non-interest income                (10,425)       10,639         (6,915)
      Provision for loan losses           120,376         5,023          8,840
      Restructuring expenses               27,809        19,354            -
      Other non-interest expenses         155,746         3,870        120,353
      Income tax benefit                 (113,854)      (26,620)      (44,395)
      Net loss                       $   (222,951) $   (49,593)   $   (16,127)

      Loans Held for Investment      $    881,179  $    (21,375)  $31,646,555
      Core Deposits(2)               $  6,107,779  $  6,373,515   $42,819,710
      Total Deposits                 $  7,621,031  $  8,034,332   $48,052,380


    Total:
      Interest Income                $  4,863,246  $  4,646,431   $ 3,901,560
      Interest Expense                  1,862,733     1,842,993     1,562,488
      Net interest income            $  3,000,513  $  2,803,438   $ 2,339,072
      Non-interest income               1,566,232     1,517,989     1,210,346
      Provision for loan losses         1,940,368     1,142,825       998,128
      Restructuring expenses               27,809        19,354           -
      Other non-interest expenses       2,107,398     1,914,867     1,962,686
      Income tax provision                169,558       428,010       185,992
      Net Income                     $    321,612   $   816,371   $   402,612

      Loans Held for Investment      $151,362,417   $144,768,561  $146,151,268
      Core Deposits(2)               $ 69,316,301   $ 69,086,358  $ 69,897,095
      Total Deposits                 $ 82,990,462   $ 83,342,814  $ 85,770,892


    (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." In Q3 2007,
        the Company shutdown the mortgage origination operations of its
        wholesale mortgage banking unit, GreenPoint Mortgage. The results of
        the mortgage origination operation of GreenPoint have been accounted
        for as a discontinued operation and have been removed from the
        Company's results of continuing operations for all periods presented.
        The results of GreenPoint's mortgage servicing business are reported
        in continuing operations for all periods presented.
        Effective Q4 2007, GreenPoint's held for investment commercial and
        consumer loan portfolio results are included in continuing
        operations.
    (2) Includes domestic non-interest bearing deposits, NOW accounts, money
        market deposit accounts, savings accounts, certificates of deposit of
        less than $100,000 and other consumer time deposits.
    (3) Results of the North Fork acquisition were included in the Other
        category for Q4 2006.
    (4) Net Interest Margin - Loans is interest income - loans divided by
        average managed loans.
    (5) Net Interest Margin - Deposits is interest expense - deposits divided
        by average retail deposits.
    (6) Efficiency Ratio is non-interest expenses divided by total managed
        revenue.
    (7) Certain prior period amounts have been reclassified to conform with
        current period presentation.



                     CAPITAL ONE FINANCIAL CORPORATION (COF)
    NATIONAL LENDING SUBSEGMENT FINANCIAL & STATISTICAL SUMMARY FOR CONTINUING
                                    OPERATIONS
                                MANAGED BASIS (1)

                                             2007         2007         2006
    (in thousands)                            Q4           Q3           Q4

    US Card:
      Interest Income                $  2,058,920   $  1,953,967  $  1,795,345
      Interest Expense                    574,714        596,767       600,821
      Net interest income            $  1,484,206   $  1,357,200  $  1,194,524
      Non-interest income               1,046,823        975,502       795,881
      Provision for loan losses           913,113        662,428       554,698
      Non-interest expenses               822,317        815,470       916,963
      Income tax provision                273,686        294,053       181,561
      Net income                     $    521,913   $    560,751  $    337,183

      Loans Held for Investment      $ 52,078,847   $ 49,573,279  $ 53,623,680
      Average Loans Held for
       Investment                    $ 50,276,568   $ 49,682,666  $ 51,686,135

      Loans Held for Investment Yield       16.38%        15.73%        13.89%
      Net Interest Margin                   11.81%        10.93%         9.24%
      Revenue Margin                        20.14%        18.78%        15.40%
      Risk Adjusted Margin                  14.74%        14.65%        11.58%
      Non-Interest Expenses as a % of
       Average Loans Held for
       Investment                            6.54%         6.57%         7.10%
      Efficiency Ratio (2)                  32.49%        34.96%        46.07%
      Net charge-off rate                    5.40%         4.13%         3.82%
      Delinquency Rate (30+ days)            4.95%         4.46%         3.74%

      Purchase Volume (3)             $  22,909,274  $ 21,522,104  $22,782,451
      Number of Loan Accounts (000s)         36,450       36,504        37,630


    Auto Finance:
      Interest Income                  $    687,389  $    661,471  $   593,268
      Interest Expense                      300,133       283,949      242,311
      Net interest income              $    387,256  $    377,522  $   350,957
      Non-interest income                    14,888        13,514       14,143
      Provision for loan losses             429,247       244,537      151,171
      Non-interest expenses                 144,301       152,275      162,022
      Income tax provision                  (58,963)       (1,987)      18,167
      Net (loss) income                $   (112,441) $     (3,789) $    33,740

      Loans Held for Investment        $ 25,128,352  $ 24,335,242  $21,751,827
      Average Loans Held for
        Investment                     $ 24,920,380  $ 24,170,047  $21,498,205

      Loans Held for Investment Yield        11.03%       10.95%       11.04%
      Net Interest Margin                     6.22%        6.25%        6.53%
      Revenue Margin                          6.45%        6.47%        6.79%
      Risk Adjusted Margin                    2.46%        2.91%        3.94%
      Non-Interest Expenses as a % of
       Average Loans Held for
       Investment                             2.32%        2.52%        3.01%
      Efficiency Ratio (2)                   35.88%       38.94%       44.38%
      Net charge-off rate                     4.00%        3.56%        2.85%
      Delinquency Rate (30+ days)             7.84%        7.15%        6.35%

      Auto Loan Originations           $  3,623,491  $ 3,248,747  $ 3,078,877
      Number of Loan Accounts (000s)          1,771        1,731        1,589


    Global Financial Services:
      Interest Income                  $    929,219  $   896,440  $   793,400
      Interest Expense                      360,233      351,399      319,974
      Net interest income              $    568,986  $   545,041  $   473,426
      Non-interest income                   322,604      323,130      295,216
      Provision for loan losses             434,967      289,122      304,968
      Non-interest expenses                 423,222      399,862      455,538
      Income tax provision                   10,079       60,781        6,040
      Net income                       $     23,322  $   118,406  $     2,096

      Loans Held for Investment        $ 29,301,244  $28,647,750  $26,983,673
      Average Loans Held for
       Investment                      $ 29,124,537  $27,952,871  $26,697,140

      Loans Held for Investment Yield
       (4)                                   12.69%       12.72%       11.80%
      Net Interest Margin                     7.81%        7.80%        7.09%
      Revenue Margin                         12.25%       12.42%       11.52%
      Risk Adjusted Margin                    8.05%        8.42%        7.63%
      Non-Interest Expenses as a % of
       Average Loans Held for
       Investment                             5.81%        5.72%        6.83%
      Efficiency Ratio (2)                   47.47%       46.06%       59.27%
      Net charge-off rate                     4.19%        4.00%        3.89%
      Delinquency Rate (30+ days)             3.29%        3.02%        2.97%

      Number of Loan Accounts (000s)         10,316       10,238       10,155


    (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) Efficiency ratio is non-Interest Expenses divided by total Managed
        Revenue.
    (3) Includes all purchase transactions net of returns and excludes cash
        advance transactions.
    (4) Excludes "GFS - Home Loans Originations" and "GFS - Settlement
        Services" from Other Interest Income.



    CAPITAL ONE FINANCIAL CORPORATION
    Reconciliation to GAAP Financial Measures
    For the Three Months Ended December 31, 2007
    (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 Reported   Adjustments(1) Total Managed(2)
    Income Statement Measures(3)
    Net interest income        $   1,762,247    $  1,238,266  $   3,000,513
    Non-interest income            2,158,340        (592,108)     1,566,232
    Total revenue                  3,920,587         646,158      4,566,745
    Provision for loan losses      1,294,210         646,158      1,940,368
    Net charge-offs            $     650,018        $646,158  $   1,296,176
    Balance Sheet Measures
    Loans Held for Investment  $ 101,805,027    $ 49,557,390  $ 151,362,417
    Total assets               $ 150,590,369    $ 48,706,677  $ 199,297,046
    Average loans Held for
     Investment                $  97,784,813    $ 50,577,525  $ 148,362,338
    Average earning assets     $ 127,553,955    $ 48,409,256  $ 175,963,211
    Average total assets       $ 151,517,794    $ 49,732,018  $ 201,249,812
    Delinquencies              $  3,721,444     $ 2,142,353   $ 5,863,797

    (1) Income statement adjustments reclassify the net of finance charges of
        $1,648.6 million, past-due fees of $301.1 million, other interest
        income of $(46.7) million and interest expense of $664.8 million; and
        net charge-offs of $646.2 million from Non-interest income to Net
        interest income and Provision for loan losses, respectively.

    (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.

    (3) Based on continuing operations.



    CAPITAL ONE FINANCIAL CORPORATION
    Consolidated Balance Sheets
    (in thousands)(unaudited)

                                     As of            As of           As of
                                  December 31      September 30    December 31
                                     2007              2007          2006 (1)

    Assets:
    Cash and due from banks      $  2,377,287     $  1,819,121   $  2,817,519
    Federal funds sold and
     resale agreements              1,766,762        1,922,735      1,099,156
    Interest-bearing deposits
     at other banks                   677,360          703,805        743,821
      Cash and cash equivalents     4,821,409        4,445,661      4,660,496
    Securities available
     for sale                      19,781,587       19,959,247     15,246,887
    Mortgage loans held
     for sale                         315,863        1,454,457     10,435,295
    Loans held for investment     101,805,027       95,405,217     96,512,139
      Less: Allowance for
       loan and lease losses      (2,963,000)       (2,320,000)    (2,180,000)
    Net loans held for
     investment                    98,842,027       93,085,217     94,332,139
    Accounts receivable
     from securitizations           4,717,879        6,905,859      4,589,235
    Premises and equipment, net     2,299,603        2,268,034      2,203,280
    Interest receivable               839,317          793,693        816,426
    Goodwill                       12,830,740       12,952,838     13,635,435
    Other                           6,141,944        5,289,829      3,820,092
      Total assets              $ 150,590,369     $147,154,835  $ 149,739,285


    Liabilities:
    Non-interest-bearing
     deposits                   $  11,046,549     $  10,840,189  $  11,648,070
    Interest-bearing deposits      71,943,913        72,502,625     74,122,822
    Senior and subordinated
     notes                         10,712,706        10,784,182      9,725,470
    Other borrowings               26,583,683        22,722,519     24,257,007
    Interest payable                  631,609           552,674        574,763
    Other                           5,377,797         4,965,794      4,175,947
      Total liabilities           126,296,257       122,367,983    124,504,079

    Stockholders' Equity:
    Common stock                        4,192             4,183          4,122
    Paid-in capital, net           15,860,490        15,768,525     15,333,137
    Retained earnings and
     cumulative other
     comprehensive income          11,582,816        11,395,226     10,026,364
      Less:  Treasury stock,
       at cost                     (3,153,386)       (2,381,082)     (128,417)
      Total stockholders'
       equity                      24,294,112        24,786,852     25,235,206
      Total liabilities and
       stockholders' equity    $  150,590,369     $ 147,154,835  $ 149,739,285


    (1) Certain prior period amounts have been reclassified to conform to the
        current period presentation.



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

                        Three Months Ended                   Year Ended
                    Dec. 31     Sept. 30    Dec. 31 (1)  Dec. 31   Dec. 31 (1)
                      2007        2007        2006         2007       2006


    Interest Income:
    Loans held for
     investment,
     including
     past-due fees  $2,536,779  $2,381,096  $2,002,111  $9,500,128  $7,046,473
    Securities
     available for
     sale              256,364     252,550     185,424     950,972     676,712
    Other              167,051     133,321     136,390     627,056     441,550
      Total interest
       income        2,960,194   2,766,967   2,323,925  11,078,156   8,164,735

    Interest
     Expense:
    Deposits           686,174     740,091     552,385   2,906,351   1,814,797
    Senior and
     subordinated
     notes             159,878     144,643     136,282     577,128     411,643
    Other borrowings   351,895     257,759     242,286   1,064,832     846,849
      Total interest
       expense       1,197,947   1,142,493     930,953   4,548,311   3,073,289
    Net interest
     income          1,762,247   1,624,474   1,392,972   6,529,845   5,091,446
    Provision for
     loan and lease
     losses          1,294,210     595,534     513,157   2,636,502   1,476,438
    Net interest
     income after
     provision for
     loan and lease
     losses            468,037   1,028,940     879,815   3,893,343   3,615,008

    Non-Interest
     Income:
    Servicing and
     securitizations 1,271,396   1,354,303     959,436   4,840,677   4,209,637
    Service charges
     and other
     customer-related
     fees              573,034     522,374     462,086   2,057,854   1,770,340
    Mortgage servicing
     and other          (5,700)     52,661      58,805     166,776     177,893
    Interchange        152,595     103,799     147,571     500,484     549,074
    Other              167,015     116,525      43,577     488,432     294,080
      Total non-
       interest
       income        2,158,340   2,149,662   1,671,475   8,054,223   7,001,024

    Non-Interest
     Expense:
    Salaries and
     associate
     benefits          622,101     627,358     617,563   2,592,534   2,224,676
    Marketing          358,182     332,693     395,360   1,347,836   1,444,324
    Communications
     and data
     processing        189,415     194,551     187,043     758,820     712,001
    Supplies and
     equipment         146,267     134,639     137,582     531,238     460,419
    Occupancy           91,675      77,597      63,796     322,510     215,636
    Restructuring
     expense            27,809      19,354           -     138,237           -
    Other              699,758     548,029     561,342   2,386,835   1,886,635
      Total non-
       interest
       expense       2,135,207   1,934,221   1,962,686   8,078,010   6,943,691
    Income from
     continuing
     operations
     before income
     taxes             491,170   1,244,381     588,604   3,869,556   3,672,341
    Income taxes       169,558     428,010     185,992   1,277,837   1,245,964
    Income from
     continuing
     operations, net
     of tax            321,612     816,371     402,612   2,591,719   2,426,377
    Loss from
     discontinued
     operations, net
     of tax(2)         (95,044)   (898,029)    (11,884) (1,021,387)   (11,884)
    Net income (loss) $226,568    $(81,658)   $390,728  $1,570,332  $2,414,493


    Basic earnings
     per share
    Income from
     continuing
     operations          $0.85       $2.11       $1.20       $6.64      $7.84
    Loss from
     discontinued
     operations          (0.25)      (2.32)      (0.04)      (2.62)     (0.04)
    Net income (loss)    $0.60      $(0.21)      $1.16       $4.02      $7.80

    Diluted earnings
     per share
    Income from
     continuing
     operations          $0.85       $2.09       $1.17       $6.55      $7.65
    Loss from
     discontinued
     operations          (0.25)      (2.30)      (0.03)      (2.58)     (0.03)
    Net income (loss)    $0.60      $(0.21)      $1.14       $3.97      $7.62

    Dividends paid
     per share           $0.03       $0.03       $0.03       $0.11      $0.11

    (1) Certain prior period amounts have been reclassified to conform to the
        current period presentation.

    (2) Certain prior period amounts have been reclassified to conform to the
        current period presentation. In Q3 2007, the Company shutdown the
        mortgage origination operations of its wholesale mortgage banking
        unit, GreenPoint Mortgage, realizing an after-tax loss of $898.0
        million.  The results of the mortgage origination operation of
        GreenPoint have been accounted for as a discontinued operation and
        have been removed from the Company's results of continuing operations
        for all periods presented.



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

    Reported                                   Quarter Ended 12/31/07
                                        Average       Income/       Yield/
                                        Balance       Expense         Rate
    Earning assets:
      Loans held for investment        97,784,813     2,536,779       10.38%
      Securities available
       for sale                        20,102,440       256,364        5.10%
      Other                             9,355,161       167,051        7.14%
    Total earning assets (2)       $  127,242,414   $ 2,960,194        9.31%

    Interest-bearing liabilities:
      Interest-bearing deposits
        NOW accounts               $    4,674,490   $    30,443        2.61%
        Money market deposit
         accounts                      28,983,602       270,943        3.74%
        Savings accounts                8,172,510        32,520        1.59%
        Other Consumer Time
         Deposits                      16,374,958       183,570        4.48%
        Public Fund CD's of
         $100,000 or more               1,902,442        23,126        4.86%
        CD's of $100,000 or more        8,335,941        97,335        4.67%
        Foreign time deposits           3,868,444        48,237        4.99%
      Total Interest-bearing
       deposits                    $   72,312,387   $   686,174        3.80%
      Senior and subordinated
       notes                           10,682,635        159,878       5.99%
      Other borrowings                 26,433,200        351,895       5.33%
    Total interest-bearing
     liabilities(2)                $  109,428,222   $  1,197,947       4.38%

    Net interest spread                                                4.93%

    Interest income to average
     earning assets                                                    9.31%
    Interest expense to
     average earning assets                                            3.77%
    Net interest margin                                                5.54%


    Reported                                    Quarter Ended 9/30/07 (1)
                                        Average         Income/       Yield/
                                        Balance        Expense         Rate
    Earning assets:
      Loans held for investment        91,744,846      2,381,096       10.38%
      Securities available
       for sale                        20,041,177        252,550        5.04%
      Other                             6,568,358        133,321        8.12%
    Total earning assets (2)       $  118,354,381   $  2,766,967        9.35%

    Interest-bearing liabilities:
      Interest-bearing deposits
        NOW accounts               $    4,759,665   $     34,030        2.86%
        Money market deposit
         accounts                      28,696,735        294,873        4.11%
        Savings accounts                8,345,638         37,474        1.80%
        Other Consumer Time
         Deposits                      17,203,453        194,256        4.52%
        Public Fund CD's
         of $100,000 or more            1,884,767         23,092        4.90%
        CD's of $100,000 or more        8,673,860        103,296        4.76%
        Foreign time deposits           3,991,056         53,070        5.32%
      Total Interest-bearing
       deposits                    $   73,555,174    $   740,091        4.02%
      Senior and subordinated
       notes                            9,811,821        144,643        5.90%
      Other borrowings                 18,892,876        257,759        5.46%
    Total interest-bearing
     liabilities(2)                $  102,259,871    $ 1,142,493        4.47%

    Net interest spread                                                 4.88%

    Interest income to average
     earning assets                                                     9.35%
    Interest expense to average
     earning assets                                                     3.86%
    Net interest margin                                                 5.49%


    Reported                                 Quarter Ended 12/31/06 (1)
                                        Average         Income/        Yield/
                                        Balance         Expense         Rate
    Earning assets:
      Loans held for investment       74,737,753       2,002,111       10.72%
      Securities available
       for sale                       15,090,001         185,424        4.92%
      Other                            8,020,811         136,390        6.80%
    Total earning assets (2)       $  97,848,565    $  2,323,925        9.50%

    Interest-bearing liabilities:
      Interest-bearing deposits
        NOW accounts               $   2,094,623    $     14,546        2.78%
        Money market deposit
         accounts                     15,762,255         149,831        3.80%
        Savings accounts               5,425,790          31,386        2.31%
        Other Consumer Time
         Deposits                     16,656,731         190,489        4.57%
        Public Fund CD's
         of $100,000 or more           1,281,768          16,636        5.19%
        CD's of $100,000 or more       8,682,658         101,535        4.68%
        Foreign time deposits          3,831,401          47,962        5.01%
      Total Interest-bearing
       deposits                    $  53,735,226     $   552,385        4.11%
      Senior and subordinated
       notes                           9,034,696         136,282        6.03%
      Other borrowings                18,891,606         242,286        5.13%
    Total interest-bearing
     liabilities(2)                $  81,661,528     $   930,953        4.56%

    Net interest spread                                                 4.94%

    Interest income to average
     earning assets                                                     9.50%
    Interest expense to average
     earning assets                                                     3.81%
    Net interest margin                                                 5.69%


    (1) Prior period amounts have been reclassified to conform with current
        period presentation.
    (2) Average balances, income and expenses, yields and rates are based on
        continuing operations.


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

    Managed (1)                              Quarter Ended 12/31/07
                                        Average        Income/       Yield/
                                        Balance        Expense         Rate
    Earning assets:

      Loans held for investment     148,362,338       4,512,219       12.17%
      Securities available
       for sale                      20,102,440         256,364        5.10%
      Other                           7,186,892          94,663        5.27%
    Total earning assets (3)     $  175,651,670    $  4,863,246       11.07%

    Interest-bearing liabilities:
      Interest-bearing deposits
        NOW accounts             $   4,674,490     $    30,443        2.61%
        Money market deposit
         accounts                   28,983,602         270,943        3.74%
        Savings accounts             8,172,510          32,520        1.59%
        Other Consumer Time
         Deposits                   16,374,958         183,570        4.48%
        Public Fund CD's
         of $100,000 or more         1,902,442          23,126        4.86%
        CD's of $100,000 or more     8,335,941          97,335        4.67%
        Foreign time deposits        3,868,444          48,237        4.99%
      Total Interest-bearing
       deposits                  $  72,312,387     $   686,174        3.80%
      Senior and subordinated
       notes                        10,682,635         159,878        5.99%
      Other borrowings              26,433,200         351,895        5.33%
      Securitization liability      49,847,555         664,786        5.33%
    Total interest-bearing
     liabilities(3)              $ 159,275,777     $ 1,862,733        4.68%

    Net interest spread                                               6.39%

    Interest income to average
     earning assets                                                  11.07%
    Interest expense to average
     earning assets                                                   4.24%
    Net interest margin                                               6.83%


    Managed (1)                                Quarter Ended 9/30/07 (2)
                                        Average        Income/       Yield/
                                        Balance        Expense         Rate
    Earning assets:

      Loans held for investment     143,781,268       4,324,272       12.03%
      Securities available
       for sale                      20,041,177         252,550        5.04%
      Other                           4,415,978          69,610        6.31%
    Total earning assets (3)     $  168,238,423     $ 4,646,432       11.05%

    Interest-bearing liabilities:
      Interest-bearing deposits
        NOW accounts             $    4,759,665     $    34,030        2.86%
        Money market deposit
         accounts                    28,696,735         294,873        4.11%
        Savings accounts              8,345,638          37,474        1.80%
        Other Consumer Time
         Deposits                    17,203,453         194,256        4.52%
        Public Fund CD's
         of $100,000 or more          1,884,767          23,092        4.90%
        CD's of $100,000 or more      8,673,860         103,296        4.76%
        Foreign time deposits         3,991,056          53,070        5.32%
      Total Interest-bearing
       deposits                   $  73,555,174     $   740,091        4.02%
      Senior and subordinated
       notes                          9,811,821         144,643        5.90%
      Other borrowings               18,892,876         257,759        5.46%
      Securitization liability       51,320,446         700,501        5.46%
    Total interest-bearing
     liabilities(3)              $  153,580,317     $ 1,842,994        4.80%

    Net interest spread                                                6.25%

    Interest income to average
     earning assets                                                   11.05%
    Interest expense to average
     earning assets                                                    4.38%
    Net interest margin                                                6.67%


    Managed (1)                               Quarter Ended 12/31/06 (2)
                                        Average        Income/       Yield/
                                        Balance        Expense         Rate
    Earning assets:

      Loans held for investment     123,901,960       3,640,588       11.75%
      Securities available
       for sale                      15,090,001         185,424        4.92%
      Other                           6,121,053          75,547        4.94%
    Total earning assets (3)     $  145,113,014    $  3,901,559       10.76%

    Interest-bearing liabilities:
      Interest-bearing deposits
        NOW accounts             $   2,094,623     $     14,546        2.78%
        Money market deposit
         accounts                    15,762,255         149,831        3.80%
        Savings accounts              5,425,790          31,386        2.31%
        Other Consumer Time
         Deposits                    16,656,731         190,489        4.57%
        Public Fund CD's
         of $100,000 or more          1,281,768          16,636        5.19%
        CD's of $100,000 or more      8,682,658         101,535        4.68%
        Foreign time deposits         3,831,401          47,962        5.01%
      Total Interest-bearing
       deposits                   $  53,735,226    $    552,385        4.11%
      Senior and subordinated
       notes                          9,034,696         136,282        6.03%
      Other borrowings               18,891,606         242,299        5.13%
      Securitization liability       48,603,831         631,521        5.20%
    Total interest-bearing
     liabilities(3)               $ 130,265,359    $  1,562,487        4.80%

    Net interest spread                                                5.96%

    Interest income to average
     earning assets                                                   10.76%
    Interest expense to average
     earning assets                                                    4.31%
    Net interest margin                                                6.45%


    (1) The information in this table reflects the adjustment to add back the
        effect of securitized loans.
    (2) Prior period amounts have been reclassified to conform with current
        period presentation.
    (3) Average balances, income and expenses, yields and rates are based on
        continuing operations.

CONTACT:
Investor Relations
Jeff Norris
+1-703-720-2455

Media Relations
Tatiana Stead
+1-703-720-2352

Julie Rakes
+1-804-284-5800
All of Capital One Financial Corporation