What was the Domestic Card net charge-off rate in September 2024, and how much of it was due to the Walmart agreement?

The Domestic Card net charge-off rate was 5.23% for September 2024. Capital One states that the termination of its Walmart program agreement, effective May 21, 2024, increased that rate by 36 basis points. Excluding this impact, the rate would have been 4.87%.

Is this filing an earnings release or does it change Capital One's financial outlook?

No. The 8-K furnishes monthly charge-off and delinquency metrics under Regulation FD. It does not include earnings, a balance sheet, or forward-looking guidance, so it should be read as an interim credit-performance update.

How do Auto credit metrics compare with Domestic Card metrics in this report?

Auto had a lower net charge-off rate (1.94% versus 5.23% for Domestic Card) but a higher 30+ day performing delinquency rate (5.61% versus 4.53%). Auto also reports a nonperforming loan rate of 0.91%, while the card segment reports N/A for nonperforming loans. The filing gives no prior-period figures, so the direction of these trends cannot be determined from this document alone.

Why should investors be cautious about the reported card charge-off rate?

Net charge-off rates are affected by fluctuations in recoveries, including the impact of debt sales, as noted in the filing's footnotes. The Walmart termination also added 36 basis points to the September figure, so the headline rate overstates the underlying run-rate by that amount. Investors should compare the 4.87% adjusted figure with prior months to gauge the trend.

CAPITAL ONE FINANCIAL CORP 8-K: Regulation FD

01—Abstract

Summary

Summary of the 8-K filed October 24, 2024. Cited figures are marked; the original filing is the authoritative source.

Capital One Financial Corporation (COF) filed a Form 8-K under Item 7.01 (Regulation FD) furnishing its Monthly Charge-Off and Delinquency Metrics for the month ended September 30, 2024.

The release is a monthly credit-performance update, not an earnings report, and it contains no new guidance, earnings, or balance sheet results. Its main value to investors is the credit trend data it provides. The headline figure is the Domestic Card net charge-off rate of 5.23% for September 2024, on average loans held for investment of $147.8 billion^a and period-end loans of $149.4 billion.

Management attributes 36 basis points of that rate to the termination of the Walmart program agreement, effective May 21, 2024. Excluding that impact, the Domestic Card net charge-off rate would have been 4.87%. Domestic Card 30+ day performing delinquencies were 4.53% of period-end loans ($6.8 billion^b).

Nonperforming loans are not reported for the card segment. In Consumer Banking, the Auto portfolio (period-end loans of $75.5 billion^c) posted a net charge-off rate of 1.94% and a 30+ day performing delinquency rate of 5.61%, with a nonperforming loan rate of 0.91%. The exhibit as provided is truncated and omits the remaining segments, such as Commercial Banking and the consolidated totals, and it gives no prior-period comparisons, so trend conclusions should be drawn with the full exhibit and prior monthly releases.

02—Key points

Key Highlights

Domestic Card net charge-off rate was 5.23% for September 2024 on $149.4B of period-end loans, with $644M of net charge-offs in the month.
The Walmart program agreement termination (effective May 21, 2024) added 36 basis points to the Domestic Card net charge-off rate; excluding this, the rate would have been 4.87%.
Domestic Card 30+ day performing delinquency rate was 4.53%, totaling $6.8B of delinquent loans.
Auto net charge-off rate was 1.94% on $75.5B of period-end loans, with net charge-offs of $122M for the month.
Auto 30+ day performing delinquency rate was 5.61% and the nonperforming loan rate was 0.91% ($685M).
The filing is a Regulation FD disclosure furnished under Item 7.01 and is not filed for Section 18 purposes; it contains no earnings, guidance, or new financial statements.
The exhibit provided is incomplete (the Auto row is cut off and other segments are absent), so the full monthly release should be reviewed before drawing segment-level conclusions.

03—Questions

Frequently Asked Questions

What was the Domestic Card net charge-off rate in September 2024, and how much of it was due to the Walmart agreement?
The Domestic Card net charge-off rate was 5.23% for September 2024. Capital One states that the termination of its Walmart program agreement, effective May 21, 2024, increased that rate by 36 basis points. Excluding this impact, the rate would have been 4.87%.
Is this filing an earnings release or does it change Capital One's financial outlook?
No. The 8-K furnishes monthly charge-off and delinquency metrics under Regulation FD. It does not include earnings, a balance sheet, or forward-looking guidance, so it should be read as an interim credit-performance update.
How do Auto credit metrics compare with Domestic Card metrics in this report?
Auto had a lower net charge-off rate (1.94% versus 5.23% for Domestic Card) but a higher 30+ day performing delinquency rate (5.61% versus 4.53%). Auto also reports a nonperforming loan rate of 0.91%, while the card segment reports N/A for nonperforming loans. The filing gives no prior-period figures, so the direction of these trends cannot be determined from this document alone.
Why should investors be cautious about the reported card charge-off rate?
Net charge-off rates are affected by fluctuations in recoveries, including the impact of debt sales, as noted in the filing's footnotes. The Walmart termination also added 36 basis points to the September figure, so the headline rate overstates the underlying run-rate by that amount. Investors should compare the 4.87% adjusted figure with prior months to gauge the trend.

04—Continue

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