Summary
Capital One Financial Corporation (COF) reported solid financial results for the second quarter and first six months of 2017. Net income available to common stockholders increased by 9% to $948 million in Q2 2017 compared to the prior year, and decreased by 8% to $1.7 billion for the first six months of 2017. Total net revenue saw a 7% increase in Q2 and a 6% increase year-to-date, primarily driven by higher interest income from loan growth in auto and credit card portfolios and increased yields due to higher interest rates. Non-interest income also saw a boost from higher net interchange fees. However, the company experienced a significant increase in the provision for credit losses, up 13% in Q2 and 22% year-to-date, largely due to higher charge-offs in the credit card and auto loan portfolios, as well as in the commercial banking segment due to specific portfolio pressures. Despite this, Capital One demonstrated strong capital positions, with its Common Equity Tier 1 capital ratio at 10.7% as of June 30, 2017, exceeding regulatory minimums. The company also announced a new $1.85 billion stock repurchase program, indicating confidence in its future performance and a commitment to returning capital to shareholders.
Financial Highlights
41 data points| Revenue | $6.70B |
| Operating Income | $1.84B |
| Interest Expense | $655.00M |
| Net Income | $1.04B |
| EPS (Basic) | $1.96 |
| EPS (Diluted) | $1.94 |
| Shares Outstanding (Basic) | 484.00M |
| Shares Outstanding (Diluted) | 488.10M |
Key Highlights
- 1Net income available to common stockholders increased 9% year-over-year to $948 million in Q2 2017.
- 2Total net revenue grew 7% in Q2 2017 to $6.7 billion, driven by higher interest income and net interchange fees.
- 3Provision for credit losses increased significantly by 13% in Q2 2017 to $1.8 billion, primarily due to higher charge-offs in credit card and auto loans.
- 4Loans held for investment decreased slightly by 1% to $244.3 billion at period-end but increased by 5% on average during Q2.
- 5The Common Equity Tier 1 capital ratio stood at a strong 10.7% as of June 30, 2017.
- 6Capital One announced a new $1.85 billion stock repurchase program, signaling confidence and a commitment to shareholder returns.
- 7Net charge-off rate increased by 66 basis points to 2.67% in Q2 2017, reflecting portfolio seasoning and impacts in the auto loan segment.