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Capital One Financial (NYSE: COF)
Q3 2024 Earnings Call
Oct 24, 2024, 5:00 p.m. ET

Overview of Today’s Call

• Prepared Remarks
• Questions and Answers
• Call Participants

Prepared Remarks:

Operator

Good day, and thank you for joining. Welcome to the Capital One Q3 2024 earnings call. This conference is being recorded. I now turn the floor over to Jeff Norris, Senior Vice President of Finance.

Jeff Norris — Senior Vice President, Global Finance

Thank you, Josh, and welcome everyone. As usual, we are webcasting live over the Internet. To join, please visit Capital One’s website at capitalone.com and follow the links provided. We have released our press release and financial details, along with a presentation that summarizes our third quarter results. Present with me are Mr. Richard Fairbank, Capital One’s Chairman and CEO, and Mr. Andrew Young, CFO. They will guide you through the presentation. For access, go to the Investor section on Capital One’s website, then Financials, and find the quarterly earnings release.

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Keep in mind that this presentation may include forward-looking statements. The financial performance details and future projections are current only as of the indicated dates. Capital One does not commit to revising this information based on new details or future events. A variety of factors may lead to actual results differing from these forward-looking statements.

For more details on these factors, please refer to the Forward-looking Information section in our earnings release presentation and Risk Factors in our annual and quarterly reports on Capital One’s website and filed with the SEC. Now, I will hand the call over to Mr. Young. Andrew?

Andrew M. Young — Chief Financial Officer

Thanks, and good afternoon, everyone. I will begin with Slide 3 of our presentation. In the third quarter, Capital One reported earnings of $1.8 billion or $4.41 per diluted share. This figure included adjustments for Discover integration costs and a minor downward revision in our FDIC assessment estimate.

After these adjustments, the earnings per share for the quarter stood at $4.51. Pre-provision earnings rose by 3% sequentially to $4.7 billion. Revenue increased by 5% compared to the previous quarter, largely due to a rise in net interest income. Noninterest expenses grew by 7%, influenced by operational expenses and marketing investments.

The provision for credit losses totaled $2.5 billion for the quarter, a decrease of $1.4 billion compared to the prior quarter. This drop primarily reflected the absence of a one-time allowance build from the second quarter related to the Walmart partnership termination, a decline in card coverage ratio, and a $40 million reduction in net charge-offs. Now, turning to Slide 4, I will delve deeper into the allowance details.

This quarter, we released $134 million from our allowance, bringing the total allowance balance to $16.5 billion. Our overall portfolio coverage ratio dipped seven basis points to 5.16%. The drop was mainly due to allowance releases in our card and consumer banking segments, which I will explain in detail on Slide 5.

In the Domestic Card division, we released $66 million of allowance, leading to an 18 basis point decline in coverage to 8.36%. Our credit outlook has improved slightly, enhancing our confidence in underlying credit trends, which facilitated a modest allowance release.

In Consumer Banking, we released $50 million of allowance, resulting in a 10-basis-point decrease in our coverage ratio, driven by strong credit performance and improving recoveries in our auto sector. Contrarily, commercial banking saw an increase of $14 million in allowance, keeping its coverage ratio roughly flat at 1.76%. Now let’s move to Slide 6.

I will now discuss liquidity. During the quarter, total liquidity reserves increased by about $9 billion to approximately $132 billion. Our cash position ended the quarter around $49 billion, which is an increase of about $4 billion from the previous quarter, primarily due to strong deposit growth. Our preliminary average liquidity coverage ratio for the third quarter was 163%, up from 155% in the second quarter.

Turning to Page 7, I will discuss our net interest margin. The margin for the third quarter was 7.11%, which is 41 basis points higher than last quarter and 42 basis points higher than the same period last year. This increase was due to three main factors:

First, there were higher yields from card and auto lending. Notably, the card yield benefitted from the complete impact of the termination of the revenue-sharing agreement with Walmart, which boosted total company NIM by 12 basis points from the last quarter and 22 basis points year-over-year. Second, the third quarter had one extra day. Finally, we experienced a higher mix of card loans on our balance sheet. Moving to Slide 8, I will conclude with a review of our capital position.

Our common equity Tier 1 capital ratio finished the quarter at 13.6%, up 40 basis points from the last quarter. Higher net income contributed to this increase but was balanced by dividends, loan growth, and $150 million spent on share repurchases. To remind everyone, we previously announced the acquisition of Discover as a significant expansion of our business.

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Capital One Reports Strong Third-Quarter Results Amid Regulatory Changes

The Federal Reserve’s approval process continues to impact capital actions as the merger moves forward. Now, I’ll hand over the call to Rich.

Rich?

Richard D. Fairbank — Chairman and Chief Executive Officer

Thank you, Andrew, and good evening, everyone. Slide 10 presents third-quarter outcomes for our credit card business. Results from our credit card segment predominantly reflect domestic trends, detailed on Slide 11. In this quarter, our Domestic Card business saw continued growth, strong profit margins, and stable credit conditions.

Purchase volume increased by 5% year over year in this quarter. Ending loan balances rose by $9.1 billion, equivalent to roughly 6% year-over-year growth. Average loans saw a 7% increase, contributing to a 10% rise in third-quarter revenue, fueled by growth in both purchase volumes and loans. Revenue margins improved by 43 basis points from the previous year, reaching 18.7%.

The conclusion of the Walmart revenue-sharing agreement accounted for a 51-basis-point increase year-over-year. If we exclude this effect, the revenue margin would have been approximately 18.2%. The charge-off rate for this quarter was 5.61%, while the end of the Walmart agreement contributed to a 38 basis point increase in the charge-off rate. Without this impact, the charge-off rate would have been 5.23%, an increase of 83 basis points from the previous year. By the end of the quarter, the rate of 30-plus delinquencies stood at 4.53%, reflecting a 22-basis-point rise from last year. It’s worth noting that the end of the Walmart loss-sharing agreement did not meaningfully affect delinquency rates. The year-over-year growth rate for charge-offs and delinquencies has been steadily declining for multiple quarters and further shrank in Q3.

Compared to the previous quarter, the charge-off rate, without considering Walmart’s impact, fell by 63 basis points, while the 30-plus delinquency rate rose by 39 basis points, both trends aligning with seasonal expectations. Domestic Card noninterest expenses increased by 12% compared to the third quarter of 2023, primarily due to higher marketing expenses. Total marketing expenses across the company for this quarter reached $1.1 billion, a 15% rise year over year, with Domestic Card marketing being the largest contributor.

We perceive significant growth opportunities in our Domestic Card sector. Our marketing efforts continue to yield strong new account growth compared to the same quarter last year. Activities in this quarter emphasized enhanced marketing to boost top-tier originations, along with increased media spending and investment in unique customer experiences like travel lounges and the Capital One shopping experience. Slide 12 outlines third-quarter outcomes in our Consumer Banking division.

Auto originations surged by 23% year over year during Q3. Our consistent credit performance stems from strategic decisions made in previous years, positioning us favorably to capitalize on current origination opportunities. Ending loans in Consumer Banking remained flat year over year, while average loans dipped by 1%. For linked-quarter comparisons, both ending loans and average loans grew by 1%.

Consumer deposits, both ending and average, rose roughly 6% compared to the same quarter last year. Consumer Banking’s revenue fell by approximately 3% year over year, primarily due to higher deposit costs. Noninterest expenses rose by about 5% against Q3 of 2023, chiefly driven by ongoing technology investments and heightened auto originations. The auto charge-off rate for this quarter stood at 2.05%, up by 28 basis points year over year.

In terms of delinquencies, the 30-plus delinquency rate was at 5.61%, down three basis points from last year, mainly due to our decision to tighten credit in 2022, resulting in strong and stable auto charge-offs. Slide 13 illustrates the third-quarter results for our Commercial Banking segment. Compared to the previous quarter, ending loan balances dipped by about 2%, while average loans fell by 1%—reflecting strategic credit tightening decisions made in 2023.

Ending deposits experienced a 5% increase from the previous quarter, though average deposits dropped by 1%. We continue to manage selected commercial deposit balances to focus on more attractive options. Noninterest expenses rose by approximately 2% in the third quarter.

The annualized net charge-off rate in commercial banking for the third quarter rose by seven basis points from the previous quarter to 0.22%. The criticized performing loan rate improved to 7.66%, down 96 basis points compared to the last quarter. In contrast, the criticized nonperforming loan rate increased by nine basis points to 1.55%. In summary, our third-quarter results reflect robust performance once again.

We achieved significant growth in Domestic Card loans, alongside increased purchase volumes and revenue. The auto division marked year-over-year growth in originations for the third consecutive quarter, with consumer credit trends remaining stable. Our year-to-date operating efficiency ratio, adjusted through September, stands at 41.7%.

We initially projected a 2024 annual operating efficiency ratio adjusted modestly down from 43.5% in 2023. Our outlook considered the positive effects of ending the Walmart revenue sharing and anticipated the CFPB late fee rule taking effect in October. Looking forward, we now expect the full-year 2024 annual operating efficiency ratio to be in the low 42s, with an anticipated sequential increase in operating expenses for Q4 aligning with historical patterns as we invest in our technology transformation.

We also reassess our assumptions regarding the CFPB late fee rule’s implementation in 2024 due to ongoing regulatory litigation uncertainties. Our marketing viewpoint remains unchanged; we are committed to increasing our marketing efforts for growth and enhancing our franchise. In Domestic Card, we continue to gain traction in originations across all products and channels.

For Consumer Banking, we are focusing on marketing strategies to expand our digital-first national banking operations. We expect total company marketing to significantly exceed first-half 2024 levels, mirroring last year’s patterns, particularly with heightened promotional activities typically occurring in the fourth quarter. Regarding the Discover acquisition, we are collaborating closely with regulators as we navigate the regulatory approval process.

Discover mentioned in their recent press release that they are concurrently addressing SEC comments on their accounting practices concerning card misclassification. Once this process concludes, we will proceed with mailing our joint proxy and scheduling a shareholder vote, likely early next year. We are optimistic about securing shareholder and regulatory approvals, aiming to finalize this action early in 2025, pending the necessary approvals. Overall, the acquisition of Discover represents a unique opportunity.

It will enable us to create a consumer banking and global payments platform with distinct capabilities, modern technology, strong brands, and access to over 100 million customers. This move is set to deliver impressive financial outcomes and has the potential to boost competition and generate substantial value for merchants.

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Capital One Discusses Strong Consumer Credit Amid Economic Changes

Capital One executives shared insights on the current state of consumer credit during their latest earnings call, highlighting their solid financial performance and the factors influencing market conditions.

Jeff Norris — Senior Vice President, Global Finance

Thank you, Rich. We will now start the Q&A session. Remember, as a courtesy to other investors and analysts who may wish to ask a question, please limit yourself to one question plus a single follow-up. If you have any further questions after the Q&A session, the Investor Relations team will be available after the call.

Josh, please start the Q&A.

Questions & Answers:

Operator

Thank you. [Operator instructions] One moment for our first question. And our first question comes from Ryan Nash with Goldman Sachs. You may proceed.

Ryan Nash — Analyst

Hey, good afternoon, everyone.

Richard D. Fairbank — Chairman and Chief Executive Officer

Hey, Ryan.

Andrew M. Young — Chief Financial Officer

Hey, Ryan.

Ryan Nash — Analyst

So, Rich, let’s kick things off with credit. You can see various segments of the consumer market, from high-end consumers to subprime borrowers. It seems like Capital One is performing well with strong credit results, while others may not be doing as well.

Can you elaborate on what you’re observing among different consumer groups and the implications for potential losses in your key asset classes? Thanks. And I have a follow-up.

Richard D. Fairbank — Chairman and Chief Executive Officer

Thank you, Ryan. First, let’s discuss the strength of U.S. consumers. The labor market remains robust, although we noticed some softening in early 2024, with a slight rise in the unemployment rate. However, recent data shows signs of renewed strength in job creation.

Real incomes are rising, and last month, we witnessed a significant upward revision in the savings rate. Consumer debt servicing burdens are stable when compared to pre-pandemic levels, and individuals have higher average bank balances than they did before COVID-19. While there are areas of pressure caused by inflation and high-interest rates, the overall picture remains positive.

Importantly, we are seeing what we’ve anticipated for some time: a delayed effect of charge-offs from the pandemic era. Many consumers, who would have typically defaulted in 2020, 2021, and 2022, managed to avoid hardships thanks to government stimulus and forbearance measures. For some, however, their financial situations remain precarious. Today, we are witnessing a return to more typical charge-off rates after a prolonged period of low defaults. Overall, consumers are in decent shape historically, though ongoing inflation and interest rate challenges may continue to create pressure.

Now, regarding your second question about Capital One’s credit specifics.

Ryan Nash — Analyst

Yes, it would be great if you can shed light on Capital One specifically. Also, Andrew, there was a notable increase in the net interest margin. With the Fed easing, could you provide insights into the drivers and expected trends for margins? Given your historical range of 6-9%, do you believe we’ve shifted out of that range? Thanks.

Andrew M. Young — Chief Financial Officer

Thanks, Ryan. Regarding NIM, several factors contributed to its increase this quarter. In the short term, we may face a headwind because we are asset-sensitive, which could slightly pressure margins. However, ongoing card growth relative to our overall balance sheet is helping our margins as well.

Looking long-term, we face both headwinds and tailwinds. The continued growth of our card segment should provide support, while we must also monitor how beta rates will evolve. With increased deposits, we might maintain higher cash levels for a while. Should the yield curve steepen, that could also benefit us. Yet, we remain cautious about potential credit path challenges that may hinder revenue.

So, in summary, we’ve seen stability over the past few quarters, with a noticeable boost in the most recent period. I’d encourage you to weigh these headwinds and tailwinds as you consider our outlook.

Ryan Nash — Analyst

Thank you.

Richard D. Fairbank — Chairman and Chief Executive Officer

To add a bit about Capital One specifically: our charge-off and delinquency rates in the card division have returned to normal seasonal patterns. It’s noteworthy that these rates are higher than pre-pandemic levels for three reasons. First, we continue to see lower recovery rates compared to before COVID-19, resulting in a growing inventory of charge-offs.

Secondly, inflation and interest rate hikes have impacted affordability for some consumers, particularly for those whose earnings haven’t kept up with rising costs. This combination indicates that while consumers are generally stable, there are still underlying challenges moving forward.

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Capital One Discusses Credit Trends and Charge-Offs in Q3 Earnings Call

In a recent earnings call, Capital One executives provided insights into credit trends and charge-off levels, highlighting the stability of their portfolio since the pandemic.

Understanding Charge-Offs and Credit Metrics

During the discussion, executives noted that while charge-offs are currently above pre-pandemic levels, this could be linked to a delayed impact from earlier credit conditions. They mentioned that since 2020, income growth at the lower end of the market has been relatively strong, with more prime customers experiencing debt burdens as compared to subprime borrowers.

Industry-Wide Trends Affecting Capital One

Executives acknowledged industry data indicating that post-pandemic credit issuance carries more risk than pre-pandemic levels, likely due to inflated credit scores during the pandemic. Capital One took proactive measures by tightening its underwriting processes during this period. This cautious approach allowed them to maintain stable performance on recent originations.

Delinquency Rates and Seasonal Patterns

In response to a question about delinquency rates, Capital One’s CEO, Richard D. Fairbank, clarified that while there are signs of credit stabilizing, he did not predict that credit will surpass seasonal benchmarks immediately. Instead, the company has been closely monitoring emerging patterns in credit normalization.

Impact of Tax Refunds on Credit Performance

Fairbank discussed the influence of tax refund distributions on seasonal delinquency trends. Historically, the second quarter is characterized by reduced delinquencies due to tax refunds, while the fourth quarter sees an increase. Changes from the IRS regarding tax withholding have led to fewer refunds, affecting seasonal credit performance.

Looking Ahead

Moving forward, Capital One anticipates that previous seasonal patterns may be less pronounced due to these alterations in tax refund behavior, ultimately stabilizing credit results. The executives expressed confidence in their strategies to navigate the evolving financial landscape and remain optimistic about the credit market’s trajectory.

Jeff Norris — Senior Vice President, Global Finance

Next question, please.

Operator

Thank you. Our next question comes from Sanjay Sakhrani with KBW. You may proceed.

Sanjay Sakhrani — Analyst

Thank you. Good evening. Following up on credit again, Rich, you noted last quarter that we may see credit performance improve beyond seasonal patterns. Can we expect that improvement moving forward?

Richard D. Fairbank — Chairman and Chief Executive Officer

Stating that it may take time to see notable improvement, Fairbank reiterated that the company is attentive to signs of credit normalization. The emphasis remains on monitoring emerging patterns tightly.

The conversation encapsulated Capital One’s strategic focus on safeguarding its portfolio despite broader economic changes. As credit conditions evolve, the company’s careful approach signals resilience in a fluctuating financial environment.

Understanding Consumer Credit Trends: Insights from the Latest Earnings Call

Contextual Overview

During a recent earnings call, Richard D. Fairbank, the Chairman and CEO, shared updates on consumer credit trends within the company. With credit card balances returning to normal levels, he highlighted several factors influencing future credit forecasts.

Delayed Charge-offs and Recovery Expectations

Fairbank mentioned the phenomenon of delayed charge-offs, which are charge-offs that did not occur as expected. This “inventory” may impact credit outcomes in the future. Although he acknowledged that this effect would eventually moderate, he stressed it will likely remain relevant for some time.

Additionally, the recovery of debt that had previously been written off is another factor that may buffer losses down the road. While inflation remains a concern, the impact of high interest rates is causing pressure for some consumers, particularly those with significant debt loads. The economy remains a crucial variable in this scenario.

Allowance for Credit Losses: A Long-term Perspective

Andrew M. Young, the Chief Financial Officer, addressed the company’s allowance for loan losses, emphasizing a focus on coverage ratios. In the fourth quarter, balances typically increase and lead to lower coverage due to expected payments. However, he noted that coverage ratios would primarily be influenced by the company’s loss forecasts. Even if future projected losses decrease, significant uncertainties may temper any immediate improvements in coverage.

Young also referred to the Current Expected Credit Loss (CECL) standard, clarifying that the recent termination of the loss-sharing agreement with Walmart had a discernible impact on coverage ratios. Adjusting for this factor, the effective coverage ratio approached approximately 7% instead of 6.5% as previously reported.

Auto Lending: Observations and Outlook

In response to a question from Terry Ma of Barclays regarding the auto lending sector, Fairbank shared positive trends in auto originations over the last three quarters. Although the company had initially anticipated risks and scaled back on originations, strong credit performance has emerged as vehicle values and interest rates begin to stabilize.

Despite the recent decline in vehicle prices, both interest margins and credit conditions have improved, suggesting opportunities for manageable growth in the auto segment. By utilizing a sophisticated underwriting system and maintaining solid dealer relationships, the company is positioning itself to navigate the market’s evolving landscape effectively.

Revenue and Net Interest Margins: Future Considerations

Bill Carcache from Wolfe Research Securities posed a pertinent question regarding revenue suppression and net interest margins (NIM). Young indicated that, while seasonal factors are significant, a general trend toward lower credit could potentially alleviate some NIM pressures over time as they are correlated with loss rates.

Carcache followed up, inquiring if this quarter’s reserved release indicated an expectation of improving consumer credit conditions. Young implied that such a release could indeed suggest confidence in the transition past peak losses influenced by enhanced consumer credit status.

Conclusion

The discussion highlighted the complexities and dynamics impacting consumer credit, demonstrating the company’s awareness of market trends and its proactive strategies to navigate them successfully.

Capital One’s Foray into Growth: CFO Highlights Stability and Strategic Spending

M. Young — Chief Financial Officer

It’s challenging to consider qualitative factors alone, Bill, since we analyze our forecasts alongside economic conditions—each one being a crucial piece of the overall picture. This quarter’s release was primarily influenced by stable underlying credit trends and our confidence in those trends, which drove this quarter’s results.

Bill Carcache — Analyst

Thank you for your insights.

Andrew M. Young — Chief Financial Officer

Thanks.

Jeff Norris — Senior Vice President, Global Finance

Next question, please.

Operator

Our next question comes from Don Fandetti with Wells Fargo. You may proceed.

Donald Fandetti — Analyst

Hi, Rich. Regarding the Discover merger, do you believe that owning a network strengthens your case with regulators? The DOJ suit against Visa seems to support that view. How confident are you that your arguments are resonating with the regulators and that the deal will close?

Richard D. Fairbank — Chairman and Chief Executive Officer

This deal is unique because, typically, one player in an industry acquires another player in the same field. However, this acquisition focuses on purchasing a network, which we currently do not have. Furthermore, we are entering a market under significant scrutiny for its concentration levels. For instance, the network we are acquiring for credit cards has seen its share drop from 6% to 4% in recent years. Thus, we believe we have a strong case to present to regulators, emphasizing that this deal is pro-competitive.

We hold that the acquisition will contribute positively to competition in the credit card sector as well.

Donald Fandetti — Analyst

Thank you.

Jeff Norris — Senior Vice President, Global Finance

Next question, please.

Operator

Thank you. Our next question comes from John Hecht with Jefferies. You may proceed.

John Hecht — Analyst

Good afternoon, and thanks for addressing my questions. Most have been answered, but could you provide some insights into spending trends and business volumes? We’ve heard consumers appear more cautious in their spending habits—what’s your take on this and its effects on your business?

Richard D. Fairbank — Chairman and Chief Executive Officer

Thank you, John. Consumer spending has indeed fluctuated significantly over the last few years. At the pandemic’s onset, spending per customer dropped sharply but surged as people resumed spending, later stabilizing. Since early 2023, the spend per customer has remained steady, with a slight increase in recent months.

The growth that Capital One is experiencing mainly stems from an increase in new accounts and the spending associated with those accounts. We’ve noticed stable growth rates in both discretionary and nondiscretionary spending categories, similar to pre-pandemic levels. Overall, the credit card industry continues to grow while most other banking sectors struggle, reflecting a broader trend moving away from cash and checks towards credit cards.

We believe this trend supports our spend-first strategy, allowing us to focus on marketing and credit decisions that enhance our business metrics.

Thank you, John.

John Hecht — Analyst

Thank you. Appreciate the insights.

Jeff Norris — Senior Vice President, Global Finance

Next question, please.

Operator

Thank you. Our next question comes from Mihir Bhatia with Bank of America. You may proceed.

Mihir Bhatia — Analyst

Good afternoon. Thanks for taking my question. Following up on John’s inquiry regarding spending trends, can you provide more information about the Venture X portfolio? How much has it grown, and what role does it play in your overall card business?

Richard D. Fairbank — Chairman and Chief Executive Officer

Thank you, Mihir. We launched the Venture X card in late 2021, and the market response has been encouraging. This launch is part of our long-term strategy to strengthen our position at the high end of the market. It began with our declaration and has evolved yearly as we seamlessly integrate our momentum and brand strength to expand our market share. The Venture X card represents a key step forward, complemented by our travel portal and Capital One lounges, which enhance overall customer experiences.

While I can’t share specific figures, we are pleased with the growing traction of both Venture X products, indicating a solid step towards our aim of leading in this segment.

Capital One’s Growth Strategy: Focus on Premium Offerings and Brand Credibility

Capital One is intensifying its efforts to capture the high-end market with unique product experiences.

Investing in Unique Customer Experiences

To excel in the top tier of the market, a comprehensive and sustained effort is essential. Creating unique experiences, like lounges and exclusive rewards, is crucial. Building brand credibility as a premium player in this marketplace is also a key investment focus for Capital One, as emphasized by Richard D. Fairbank, Chairman and CEO.

Marketing Strategy and Spending Trends

Capital One has significantly increased its marketing budgets. This uptick aims to further penetrate the high-end market. The company has reported that although overall purchase volumes are rising, growth is faster in higher spending segments. This suggests a successful strategy in attracting high-spending customers.

Jeff Norris — Senior Vice President, Global Finance

Capital Management and Buybacks

Analyst John Pancari from Evercore ISI raised questions about the firm’s capital CET1 ratio of 13.6% in relation to buyback strategies. Despite uncertainties surrounding regulatory changes and the Discover acquisition, Capital One managed to repurchase around $150 million in stock during the third quarter. Andrew M. Young, Chief Financial Officer, explained that external forces, including macroeconomic factors and the pending acquisition, guide capital management decisions.

Interest Rates and Loan Yields

Pancari further inquired about the recent increase of 58 basis points in loan yields. Young clarified that seasonal factors primarily drove this increase, alongside a partial contribution from Walmart’s impact. He noted there is no significant change year-over-year when excluding seasonality effects.

Preparing for Regulatory Changes

During the call, concerns were raised about the CFPB’s proposed late fee rule. Richard D. Fairbank reaffirmed that the company is awaiting further developments regarding this rule. While it could significantly affect revenue, the company remains committed to maintaining its customer-first strategy. They have deferred some investments while awaiting the rule’s outcome, ensuring a cautious approach to potential changes in the marketplace.

Jeff Norris — Senior Vice President, Global Finance

As the conference call concluded, participants expressed appreciation for the insights shared regarding Capital One’s strategic directions and upcoming challenges.

Call Participants

Jeff Norris — Senior Vice President, Global Finance

Andrew M. Young — Chief Financial Officer

Richard D. Fairbank — Chairman and Chief Executive Officer

John Pancari — Analyst

Jeff Adelson — Analyst

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