CAPITAL ONE FINANCIAL CORP

For the period ended Jun 30, 2024. Filed Aug 1, 2024.

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A company's report for each of its first three quarters. The financial statements are not audited. It shows how the business has moved since the last annual report, and what management says changed.

Jun 30, 2024 · Filed Aug 1, 2024

COF$195.84-1.4%Stored close · as of Nov 10, 2026

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Contents

Average Balances, Net Interest Income and Net Interest Margin

Table 2 below presents the average outstanding balance, interest income earned, interest expense incurred and average yield for the second quarter and first six months of 2024 and 2023 for each major category of our interest-earning assets and interest-bearing liabilities. Nonperforming loans are included in the average loan balances below.

Table 2: Average Balances, Net Interest Income and Net Interest Margin

	Three Months Ended June 30,
2024 · 2023
(Dollars in millions) · AverageBalance · Interest Income/Expense · Average Yield/Rate(1) · AverageBalance · Interest Income/Expense · Average Yield/Rate(1)
Assets:
Interest-earning assets:
Loans:(2)
Credit card	$150,866	$7,088	18.79%		$138,762		$6,302		18.17%
Consumer banking	75,386	1,611	8.54		77,699		1,486		7.65
Commercial banking(3)	89,571	1,616	7.22		93,874		1,580		6.74
Other(4)	—	(322)	**		—	(311)		**
Total loans, including loans held for sale	315,823	9,993	12.66		310,335		9,057		11.67
Investment securities	89,501	700	3.13		89,994		639		2.84
Cash equivalents and other interest-earning assets	45,584	587	5.16		38,810		470		4.84
Total interest-earning assets	450,908	11,280	10.01		439,139		10,166		9.26
Cash and due from banks	3,650			3,928
Allowance for credit losses	(15,392)			(14,323)
Premises and equipment, net	4,383			4,369
Other assets	33,736			33,539
Total assets	$477,285			$466,652
Liabilities and stockholders’ equity:
Interest-bearing liabilities:
Interest-bearing deposits	$322,581	$2,874	3.56%		$313,207		$2,277		2.91%
Securitized debt obligations	17,452	258	5.91		17,771		236		5.31
Senior and subordinated notes	30,978	591	7.64		30,161		528		7.00
Other borrowings and interest-bearing liabilities(5)	2,502	11	1.73		2,419		12		1.95
Total interest-bearing liabilities	373,513	3,734	4.00		363,558		3,053		3.36
Non-interest-bearing deposits	26,907			30,471
Other liabilities	18,758			17,266
Total liabilities	419,178			411,295
Stockholders’ equity	58,107			55,357
Total liabilities and stockholders’ equity	$477,285			$466,652
Net interest income/spread	$7,546	6.01		$7,113		5.90
Impact of non-interest-bearing funding	0.69		0.58
Net interest margin	6.70%		6.48%

11	Capital One Financial Corporation (COF)

	Six Months Ended June 30,
2024 · 2023
(Dollars in millions) · AverageBalance · Interest Income/Expense · Average Yield/Rate(1) · AverageBalance · Interest Income/Expense · Average Yield/Rate(1)
Assets:
Interest-earning assets:
Loans:(2)
Credit card	$150,457	$14,155	18.82%		$136,727		$12,355	18.07%
Consumer banking	75,239	3,175	8.44		78,346		2,947	7.52
Commercial banking(3)	89,997	3,228	7.17		94,158		3,068	6.52
Other(4)	—	(645)	**		—		(590)	**
Total loans, including loans held for sale	315,693	19,913	12.62		309,231		17,780	11.50
Investment securities	89,041	1,387	3.12		89,977		1,254	2.79
Cash equivalents and other interest-earning assets	44,622	1,157	5.19		37,972		886	4.67
Total interest-earning assets	449,356	22,457	10.00		437,180		19,920	9.11
Cash and due from banks	3,798			4,028
Allowance for credit losses	(15,342)			(13,766)
Premises and equipment, net	4,387			4,359
Other assets	33,941			32,658
Total assets	$476,140			$464,459
Liabilities and stockholders’ equity:
Interest-bearing liabilities:
Interest-bearing deposits	$320,515	$5,686	3.55%		$311,010		$4,133	2.66%
Securitized debt obligations	17,644	519	5.88		17,512		447	5.10
Senior and subordinated notes	31,594	1,197	7.58		30,149		1,017	6.75
Other borrowings and interest-bearing liabilities(5)	2,438	21	1.75		2,377		24	2.01
Total interest-bearing liabilities	372,191	7,423	3.99		361,048		5,621	3.11
Non-interest-bearing deposits	27,057			30,900
Other liabilities	18,840			17,445
Total liabilities	418,088			409,393
Stockholders’ equity	58,052			55,066
Total liabilities and stockholders’ equity	$476,140			$464,459
Net interest income/spread	$15,034	6.01		$14,299		6.00
Impact of non-interest-bearing funding	0.68		0.54
Net interest margin	6.69%		6.54%

(1)Average yield is calculated based on annualized interest income for the period divided by average loans during the period. Annualized interest income does not include any allocations, such as funds transfer pricing. Average yield is calculated using whole dollar values for average balances and interest income/expense.

(2)Past due fees, net of reversals, included in interest income totaled approximately $558 million and $1.1 billion in the second quarter and first six months of 2024, respectively, and $526 million and $1.0 billion in the second quarter and first six months of 2023, respectively.

(3)Some of our commercial investments generate tax-exempt income, tax credits or other tax benefits. Accordingly, we present our Commercial Banking revenue and yields on a taxable-equivalent basis, calculated using the federal statutory tax rate of 21% and state taxes where applicable, with offsetting reductions to the Other category. Taxable-equivalent adjustments included in the interest income and yield computations for our commercial loans totaled approximately $20 million and $39 million in the second quarter and first six months of 2024, respectively, and $19 million and $37 million in the second quarter and first six months of 2023, respectively, with corresponding reductions to the Other category.

(4)Interest income/expense in the Other category represents the impact of hedge accounting on our loan portfolios and the offsetting reduction of the taxable-equivalent adjustments of our commercial loans as described above.

12	Capital One Financial Corporation (COF)

(5)Includes amounts related to entities that provide capital to low-income and rural communities of $2.1 billion and $2.0 billion in the second quarter and first six months of 2024, respectively, and $1.9 billion and $1.8 billion in the second quarter and first six months of 2023, respectively. Related interest expense was $8 million and $16 million for the second quarter and first six months of 2024, respectively, and $8 million and $16 million for the second quarter and first six months of 2023, respectively.

** Not meaningful.

Net interest income increased by $433 million to $7.5 billion in the second quarter of 2024 compared to the second quarter of 2023 and increased by $735 million to $15.0 billion in the first six months of 2024 compared to the first six months of 2023 primarily driven by higher asset yields and growth in our credit card loan portfolio, partially offset by higher rates paid on interest-bearing deposits.

Net interest margin increased by 22 bps to 6.70% in the second quarter of 2024 compared to the second quarter of 2023 and increased by 15 bps to 6.69% in the first six months of 2024 compared to the first six months of 2023 primarily driven by higher asset yields and growth in our credit card loan portfolio, partially offset by higher rates paid on interest-bearing deposits.

Our cumulative deposit beta increased to 62% as of June 30, 2024, from 60% as of December 31, 2023. We define cumulative deposit beta as the ratio of changes in the average rate paid on our average interest-bearing deposits to the increases in the upper bound of the federal funds rate during the current rising interest rate cycle.

13	Capital One Financial Corporation (COF)

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