Capital One Financial Corporation · NYSE:COF
Capital One Financial — Q3 2020 Earnings Presentation
19 slides from Capital One Financial's earnings presentation, Oct 22, 2020
Slide 1: Third Quarter 2020 Results
Third Quarter 2020 Results October 22, 2020 1
Slide 2: Forward-Looking Statements
Forward-Looking Statements Please note that the following materials containing information regarding Capital One’s financial performance speak only as of the particular date or dates indicated in these materials. Capital One does not undertake any obligation to update or revise any of the informatio
Slide 3: Company Highlights
Company Highlights • Net income for the third quarter of 2020 of $2.4 billion, or $5.06 per diluted common share ◦ Excluding adjusting items, net income per diluted common share for the third quarter of 2020 of $5.05(1) • Pre-provision earnings increased 38% to $3.8 billion for the third quarter of
Slide 4: Allowance and Provision for Credit Losses
Allowance and Provision for Credit Losses Credit Consumer Commercial Total Card Banking Banking (Dollars in millions) Allowance for credit losses: Balance as of December 31, 2019 $ 5,395 $ 1,038 $ 775 $ 7,208 CECL adoption 2,241 502 102 2,845 Finance charge and fee reserve reclassification 462 0 0 4
Slide 5: Allowance Coverage Ratios by Segment
Allowance Coverage Ratios by Segment Domestic Card Branded Card 13.4% Credit Card $12,091 $11,612 $11,569 $11,062 $10,346 $9,806 $8,098 11.64% 11.58% 11.27% 11.20% $7,673 8.78% 8.95% $5,395 $4,997 6.31% 6.47% 4.21% 4.21% 12/31/19 01/01/20 03/31/20 06/30/20 09/30/20 12/31/19 01/01/20 03/31/20 06/30/2
Slide 6: Liquidity
Liquidity Liquidity Coverage Ratio Total Liquidity Reserves ($M) Flat Q/Q 543% Y/Y $149,146 $148,431 146% 146% 147% $105,906 145% $103,565 141% $90,557 3Q19 4Q19 1Q20 2Q20 3Q20 3Q19 4Q19 1Q20 2Q20 3Q20 Liquidity coverage ratio Unencumbered investment securities Cash and cash equivalents Available FH
Slide 7: Net Interest Income and Net Interest Margin
Net Interest Income and Net Interest Margin 52% Q/Q $6,066 $6,025 63% Y/Y $5,737 $5,555 $5,460 6.73% 6.95% 6.78% 5.78% 5.68% 3Q19 4Q19 1Q20 2Q20 3Q20 Net Interest Income ($M) Net Interest Margin Third Quarter 2020 Highlights • Net interest margin decreased 10 basis points quarter-over-quarter primar
Slide 8: Capital
Capital Common Equity Tier 1 Capital Ratio Amount Ratio (Dollars in millions) Common equity Tier 1 (CET1) as of June 30, 2020 $ 35,885 12.4% 13.0% Q3 2020 Net income 2,406 80 bps CECL Transition Provisions (181) (10)bps 12.5% 12.4% 12.2% Other quarterly activities 64 — bps 12.0% Risk Weighted Assets
Slide 9: Financial Summary—Business Segment Results
Financial Summary—Business Segment Results Three Months Ended September 30, 2020 Consumer Commercial (Dollars in millions) Credit Card Banking Banking Other Total Net interest income (loss) $ 3,292 $ 1,904 $ 517 $ (158) $ 5,555 Non-interest income 1,013 107 237 469 1,826 Total net revenue 4,305 2,01
Slide 10: Credit Card
Credit Card 2020 Q3 vs. Third Quarter 2020 Highlights 2020 2020 2019 2020 2019 (Dollars in millions, except as noted) Q3 Q2 Q3 Q2 Q3 Earnings: • Ending loans down $10.0 billion, or 9%, year-over-year; average loans Net interest income $ 3,292 $ 3,369 $ 3,546 (2) % (7) % down $7.0 billion, or 6%, yea
Slide 11: Domestic Card
Domestic Card 2020 Q3 vs. Third Quarter 2020 Highlights 2020 2020 2019 2020 2019 (Dollars in millions, except as noted) Q3 Q2 Q3 Q2 Q3 Earnings: • Ending loans down $9.1 billion, or 9%, year-over-year; average loans down Net interest income $ 2,995 $ 3,094 $ 3,299 (3) % (9) % $6.1 billion, or 6%, ye
Slide 12: Consumer Banking
Consumer Banking 2020 Q3 vs. Third Quarter 2020 Highlights 2020 2020 2019 2020 2019 (Dollars in millions, except as noted) Q3 Q2 Q3 Q2 Q3 Earnings: • Ending loans up $6.7 billion, or 11%, Net interest income $ 1,904 $ 1,665 $ 1,682 14 % 13 % year-over-year; average loans up $6.6 billion, or 11%, yea
Slide 13: Commercial Banking
Commercial Banking 2020 Q3 vs. Third Quarter 2020 Highlights 2020 2020 2019 2020 2019 (Dollars in millions, except as noted) Q3 Q2 Q3 Q2 Q3 Earnings: • Ending loans up $2.2 billion, or 3%, Net interest income $ 517 $ 518 $ 486 — 6 % year-over-year; average loans up $3.8 billion, or 5%, year-over-yea
Slide 14: Appendix
Appendix 14
Slide 15: Non-GAAP Measures
Non-GAAP Measures 2020 2020 2020 Nine Months Ended Q3 Q2 Q1 September 30, 2020 Reported Adjusted Reported Adjusted Reported Adjusted Reported Adjusted (Dollars in millions, except per share data and as noted) Results Adj.(1) Results Results Adj.(1) Results Results Adj.(1) Results Results Adj.(1) Res
Slide 16: Non-GAAP Measures
Non-GAAP Measures 2019 2019 2019 Nine Months Ended Q3 Q2 Q1 September 30, 2019 Reported Adjusted Reported Adjusted Reported Adjusted Reported Adjusted (Dollars in millions, except per share data and as noted) Results Adj.(1) Results Results Adj.(1) Results Results Adj.(1) Results Results Adj.(1) Res
Slide 17: COVID-19 Customer Assistance - Domestic Card
COVID-19 Customer Assistance - Domestic Card Weekly Enrollments as a % of Active Accounts Cumulative Enrollments as of a % of Active Accounts through 10/3/20 through 9/30/20 0.3% 3% Total: 2.4% of Accounts No longer enrolled(3) 0.2% 2% Re-Enrollment Were enrolled last month and skipped their payment
Slide 18: COVID-19 Customer Assistance - Auto
COVID-19 Customer Assistance - Auto Weekly Enrollments as a % of Accounts Cumulative Enrollments as a % of Accounts through 10/3/20 through 9/30/20 3% 18% Total: 16.1% of Accounts (3) No longer enrolled Were enrolled last month and skipped their payment as permitted (a portion may re-enroll)(2) 2% 1
Slide 19: Commercial Oil and Gas Portfolio
Commercial Oil and Gas Portfolio Total Exposure ($M) Total Reserves ($M) Exploration and production 69% ($ in millions) 3Q19 4Q19 1Q20 2Q20 3Q20 $7,481 Midstream and other 29% Allowance for $ 154 $ 187 $ 549 $ 500 $ 470 Oilfield services 2% Credit Losses $6,853 Reserves for $6,237 Unfunded $ 12 $ 10
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