CAPITAL ONE FINANCIAL CORP (Form: 8-K, Received: 01/24/2023 16:07:49)

UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

Washington, D.C. 20549

____________________________________

FORM 8-K

____________________________________

CURRENT REPORT

Pursuant to Section 13 or 15(d) of

The Securities Exchange Act of 1934

January 24, 2023

Date of Report (Date of earliest event reported)

____________________________________

CAPITAL ONE FINANCIAL CORPORATION

(Exact name of registrant as specified in its charter)

____________________________________


Delaware		001-13300	54-1719854
(State or other jurisdiction of incorporation)		(Commission File Number)	(IRS Employer Identification No.)
1680 Capital One Drive,
McLean,	Virginia		22102
(Address of principal executive offices)			(Zip Code)

Registrant’s telephone number, including area code: (703) 720-1000

(Not applicable)

(Former name or former address, if changed since last report)

____________________________________

Check the appropriate box below if the Form 8-K filing is intended to simultaneously satisfy the filing obligation of the registrant under any of the following provisions (see General Instruction A.2. below):

☐ Written communications pursuant to Rule 425 under the Securities Act (17 CFR 230.425)

☐ Soliciting material pursuant to Rule 14a-12 under the Exchange Act (17 CFR 240.14a-12)

☐ Pre-commencement communications pursuant to Rule 14d-2(b) under the Exchange Act (17 CFR 240.14d-2(b))

☐ Pre-commencement communications pursuant to Rule 13e-4(c) under the Exchange Act (17 CFR 240.13e-4(c))

Securities registered pursuant to Section 12(b) of the Act:


Title of Each Class	Trading Symbol(s)	Name of Each Exchange on Which Registered
Common Stock (par value $.01 per share)	COF	New York Stock Exchange
Depositary Shares, Each Representing a 1/40th Interest in a Share of Fixed Rate Non-Cumulative Perpetual Preferred Stock, Series I	COF PRI	New York Stock Exchange
Depositary Shares, Each Representing a 1/40th Interest in a Share of Fixed Rate Non-Cumulative Perpetual Preferred Stock, Series J	COF PRJ	New York Stock Exchange
Depositary Shares, Each Representing a 1/40th Interest in a Share of Fixed Rate Non-Cumulative Perpetual Preferred Stock, Series K	COF PRK	New York Stock Exchange
Depositary Shares, Each Representing a 1/40th Interest in a Share of Fixed Rate Non-Cumulative Perpetual Preferred Stock, Series L	COF PRL	New York Stock Exchange
Depositary Shares, Each Representing a 1/40th Interest in a Share of Fixed Rate Non-Cumulative Perpetual Preferred Stock, Series N	COF PRN	New York Stock Exchange
0.800% Senior Notes Due 2024	COF24	New York Stock Exchange
1.650% Senior Notes Due 2029	COF29	New York Stock Exchange

Indicate by check mark whether the registrant is an emerging growth company as defined in Rule 405 of the Securities Act of 1933 (§230.405 of this chapter) or Rule 12b-2 of the Securities Exchange Act of 1934 (§240.12b-2 of this chapter).

Emerging growth company ☐

If an emerging growth company, indicate by check mark if the registrant has elected not to use the extended transition period for complying with any new or revised financial accounting standards provided pursuant to Section 13(a) of the Exchange Act. ☐

Item 2.02 Results of Operations and Financial Condition.

On January 24, 2023, Capital One Financial Corporation (the “Company”) issued a press release announcing its financial results for the fourth quarter ended December 31, 2022. Copies of the Company’s press release and financial supplement are attached and furnished herewith as Exhibits 99.1 and 99.2 to this Form 8-K and are incorporated herein by reference.

Note: Information in this report (including Exhibits 99.1 and 99.2) furnished pursuant to Item 2.02 shall not be deemed to be “filed” for the purposes of Section 18 of the Securities Exchange Act of 1934 or otherwise subject to the liabilities of that Section.

Item 9.01 Financial Statements and Exhibits.

(d) Exhibits.


Exhibit No.						Description
99.1						Press Release, dated January 24, 2022 - Fourth Quarter 2022
99.2						Financial Supplement - Fourth Quarter 2022
104						The cover page from this Current Report on Form 8-K, formatted in Inline XBRL

Earnings Conference Call Webcast Information.

The Company will hold an earnings conference call on January 24, 2023 at 5:00 PM Eastern Time. The conference call will be accessible through live webcast. Interested investors and other individuals can access the webcast via the Company’s home page (www.capitalone.com). Under “About,” choose “Investors” to access the Investor Center and view and/or download the earnings press release, the financial supplement, including a reconciliation of non-GAAP financial measures, and the earnings release presentation. A replay of the webcast will be archived on the Company’s website through February 7, 2023 at 5:00 PM Eastern Time.

SIGNATURE

Pursuant to the requirements of the Securities Exchange Act of 1934, the Company has duly caused this Current Report on Form 8-K to be signed on its behalf by the undersigned hereunto duly authorized.

CAPITAL ONE FINANCIAL CORPORATION

Date: January 24, 2023

By:

/s/ TIMOTHY P. GOLDEN

Timothy P. Golden

Controller and Principal Accounting Officer

Exhibit 99.1

News Release


Contacts:
Investor Relations		Media Relations
Jeff Norris	Danielle Dietz	Sie Soheili
jeff.norris@capitalone.com	danielle.dietz@capitalone.com	sie.soheili@capitalone.com

FOR IMMEDIATE RELEASE: January 24, 2023

Capital One Reports Fourth Quarter 2022 Net Income of $1.2 billion,
or $3.03 per share

Net of adjusting items, Fourth Quarter 2022 Net Income of $2.82 per share(1)

McLean, Va. (January 24, 2023) – Capital One Financial Corporation (NYSE: COF) today announced net income for the fourth quarter of 2022 of $1.2 billion, or $3.03 per diluted common share, compared with net income of $1.7 billion, or $4.20 per diluted common share in the third quarter of 2022, and with net income of $2.4 billion, or $5.41 per diluted common share in the fourth quarter of 2021. Adjusted net income(1) for the Fourth Quarter of 2022 was $2.82 per diluted common share.

“We posted strong top line growth throughout 2022," said Richard D. Fairbank, Founder, Chairman, and Chief Executive Officer. "As a result of our investments to transform our technology and to drive resilient growth, we’re in a strong position to deliver compelling long-term shareholder value and thrive in a broad range of possible economic scenarios.”

The quarter included the following adjusting items that increase/(decrease) earnings:


(Dollars in millions, except per share data)	Pre-Tax Impact		After-Tax Diluted EPS Impact
(Dollars in millions, except per share data)	Pre-Tax Impact		After-Tax Diluted EPS Impact
Insurance recoveries and legal reserve activity	$	(177)	$	(0.35)
Restructuring Charges	$	72	$	0.14

All comparisons below are for the fourth quarter of 2022 compared with the third quarter of 2022 unless otherwise noted.

Fourth Quarter 2022 Income Statement Summary:

•Total net revenue increased 3 percent to $9.0 billion.

•Total non-interest expense increased 3 percent to $5.1 billion:

◦14 percent increase in marketing.

◦less than 1 percent decrease in operating expenses.

(1) This is a non-GAAP measure. We believe non-GAAP measures help investors and users of our financial information understand the effect of adjusting items on our selected reported results and provide alternate measurements of our performance, both in the current period and across periods. See Table 15 in Exhibit 99.2 for a reconciliation of our selected reported results to these non-GAAP measures.

Capital One Fourth Quarter 2022 Earnings

Page 2

•Pre-provision earnings(1) increased 3 percent to $4.0 billion.

•Provision for credit losses increased $747 million to $2.4 billion:

◦Net charge-offs of $1.4 billion.

◦$1.0 billion loan reserve build.

•Net interest margin of 6.84 percent, an increase of 4 basis points.

•Efficiency ratio of 56.19 percent.

◦Adjusted efficiency ratio(2) of 57.36 percent.

•Operating efficiency ratio of 43.83 percent.

◦Adjusted operating efficiency ratio(2) of 44.99 percent.

Fourth Quarter 2022 Balance Sheet Summary:

•Common equity Tier 1 capital ratio under Basel III Standardized Approach of 12.5 percent at December 31, 2022.

•Period-end loans held for investment in the quarter increased $8.4 billion, or 3 percent, to $312.3 billion.

◦Credit Card period-end loans increased $10.8 billion, or 9 percent, to $137.7 billion.

•Domestic Card period-end loans increased $10.3 billion, or 8 percent, to $131.6 billion.

◦Consumer Banking period-end loans decreased $1.3 billion, or 2 percent, to $79.9 billion.

•Auto period-end loans decreased $1.2 billion, or 2 percent, to $78.4 billion.

◦Commercial Banking period-end loans decreased $1.2 billion, or 1 percent, to $94.7 billion.

•Average loans held for investment in the quarter increased $6.7 billion, or 2 percent, to $306.9 billion.

◦Credit Card average loans increased $7.3 billion, or 6 percent, to $130.7 billion.

•Domestic Card average loans increased $7.3 billion, or 6 percent, to $124.8 billion.

◦Consumer Banking average loans decreased $639 million, or 1 percent, to $80.7 billion.

•Auto average loans decreased $633 million, or 1 percent, to $79.1 billion.

◦Commercial Banking average loans increased $39 million, or less than 1 percent, to $95.5 billion.

•Period-end total deposits increased $15.8 billion, or 5 percent, to $333.0 billion, while average deposits increased $14.6 billion, or 5 percent, to $326.6 billion.

•Interest-bearing deposits rate paid increased 82 basis points to 1.82 percent.

(1) Pre-provision earnings is calculated based on the sum of net interest income and non-interest income, less non-interest expense for the period. Management believes that this financial metric is useful in enabling investors and others to assess the Company’s ability to generate income to cover credit losses through a credit cycle, which can vary significantly between periods.

(2) This is a non-GAAP measure. We believe non-GAAP measures help investors and users of our financial information understand the effect of adjusting items on our selected reported results and provide alternate measurements of our performance, both in the current period and across periods. See Table 15 in Exhibit 99.2 for a reconciliation of our selected reported results to these non-GAAP measures.

Capital One Fourth Quarter 2022 Earnings

Page 3

2022 Full Year Income Statement Summary:

◦Total net revenue increased 13% to $34.3 billion.

◦Total non-interest expense increased 16 percent to $19.2 billion:

◦40 percent increase in marketing.

◦11 percent increase in operating expenses.

◦Pre-provision earnings(1) increased 9 percent to $15.1 billion.

◦Provision for credit losses increased $7.8 billion to $5.8 billion.

◦Net interest margin of 6.67 percent, an increase of 46 basis points.

◦Efficiency ratio of 55.95 percent .

▪Adjusted efficiency ratio(2) of 56.26 percent.

◦Operating efficiency ratio of 44.22 percent.

▪Adjusted operating efficiency ratio(2) of 44.53 percent.

Earnings Conference Call Webcast Information

The company will hold an earnings conference call on January 24, 2023 at 5:00 PM Eastern Time. The conference call will be accessible through live webcast. Interested investors and other individuals can access the webcast via the company’s home page (www.capitalone.com). Under “About,” choose “Investors” to access the Investor Center and view and/or download the earnings press release, the financial supplement, including a reconciliation of non-GAAP financial measures, and the earnings release presentation. The replay of the webcast will be archived on the company’s website through February 7, 2023 at 5:00 PM Eastern Time.

Forward-Looking Statements

Certain statements in this release may constitute forward-looking statements, which involve a number of risks and uncertainties. Capital One cautions readers that any forward-looking information is not a guarantee of future performance and that actual results could differ materially from those contained in the forward-looking information due to a number of factors, including those listed from time to time in reports that Capital One files with the Securities and Exchange Commission, including, but not limited to, the Annual Report on Form 10-K for the year ended December 31, 2021.

About Capital One

Capital One Financial Corporation (www.capitalone.com) is a financial holding company which, along with its subsidiaries, had $333.0 billion in deposits and $455.2 billion in total assets as of December 31, 2022. Headquartered in McLean, Virginia, Capital One offers a broad spectrum of financial products and services to consumers, small businesses and commercial clients through a variety of channels. Capital One, N.A. has branches located primarily in New York, Louisiana, Texas, Maryland, Virginia, New Jersey and the District of Columbia. A Fortune 500 company, Capital One trades on the New York Stock Exchange under the symbol “COF” and is included in the S&P 100 index.

###

Exhibit 99.2

Capital One Financial Corporation

Financial Supplement(1)(2)

Fourth Quarter 2022

Table of Contents


Capital One Financial Corporation Consolidated Results			Page
	Table 1:	Financial Summary—Consolidated	1
	Table 2:	Selected Metrics—Consolidated	3
	Table 3:	Consolidated Statements of Income	4
	Table 4:	Consolidated Balance Sheets	6
	Table 5:	Notes to Financial Summary, Selected Metrics and Consolidated Financial Statements (Tables 1—4)	8
	Table 6:	Average Balances, Net Interest Income and Net Interest Margin	9
	Table 7:	Loan Information and Performance Statistics	10
	Table 8:	Allowance for Credit Losses and Reserve for Unfunded Lending Commitments Activity	12
Business Segment Results
	Table 9:	Financial Summary—Business Segment Results	13
	Table 10:	Financial & Statistical Summary—Credit Card Business	14
	Table 11:	Financial & Statistical Summary—Consumer Banking Business	16
	Table 12:	Financial & Statistical Summary—Commercial Banking Business	17
	Table 13:	Financial & Statistical Summary—Other and Total	18
Other
	Table 14:	Notes to Net Interest Margin, Loan, Allowance and Business Segment Disclosures (Tables 6—13)	19
	Table 15:	Calculation of Regulatory Capital Measures and Reconciliation of Non-GAAP Measures	20

__________

(1)The information contained in this Financial Supplement is preliminary and based on data available at the time of the earnings presentation. Investors should refer to our Annual Report on Form 10-K for the period ended December 31, 2022 once it is filed with the Securities and Exchange Commission.

(2)This Financial Supplement includes non-GAAP measures. We believe these non-GAAP measures are useful to investors and users of our financial information as they provide an alternate measurement of our performance and assist in assessing our capital adequacy and the level of return generated. These non-GAAP measures should not be viewed as a substitute for reported results determined in accordance with generally accepted accounting principles in the U.S. (“GAAP”), nor are they necessarily comparable to non-GAAP measures that may be presented by other companies. See “Table 15 - Calculation of Regulatory Capital Measures and Reconciliation of Non-GAAP Measures” for a reconciliation of any non-GAAP financial measures.

CAPITAL ONE FINANCIAL CORPORATION (COF)

Table 1: Financial Summary—Consolidated


											2022 Q4 vs.				Year Ended December 31,
(Dollars in millions, except per share data and as noted)	2022		2022		2022		2022		2021		2022		2021						2022 vs.
	Q4		Q3		Q2		Q1		Q4		Q3		Q4		2022		2021		2021
Income Statement
Net interest income	$	7,197	$	7,003	$	6,517	$	6,397	$	6,450	3	%	12	%	$	27,114	$	24,171	12	%
Non-interest income	1,843		1,802		1,715		1,776		1,668		2		10		7,136		6,264		14
Total net revenue(1)	9,040		8,805		8,232		8,173		8,118		3		11		34,250		30,435		13
Provision (benefit) for credit losses	2,416		1,669		1,085		677		381		45		**		5,847		(1,944)		**
Non-interest expense:
Marketing	1,118		978		1,003		918		999		14		12		4,017		2,871		40
Operating expense	3,962		3,971		3,580		3,633		3,679		—		8		15,146		13,699		11
Total non-interest expense	5,080		4,949		4,583		4,551		4,678		3		9		19,163		16,570		16
Income from continuing operations before income taxes	1,544		2,187		2,564		2,945		3,059		(29)		(50)		9,240		15,809		(42)
Income tax provision	312		493		533		542		633		(37)		(51)		1,880		3,415		(45)
Income from continuing operations, net of tax	1,232		1,694		2,031		2,403		2,426		(27)		(49)		7,360		12,394		(41)
Income (loss) from discontinued operations, net of tax	—		—		—		—		(1)		—		**		—		(4)		**
Net income	1,232		1,694		2,031		2,403		2,425		(27)		(49)		7,360		12,390		(41)
Dividends and undistributed earnings allocated to participating securities(2)	(14)		(21)		(25)		(28)		(21)		(33)		(33)		(88)		(105)		(16)
Preferred stock dividends	(57)		(57)		(57)		(57)		(74)		—		(23)		(228)		(274)		(17)
Issuance cost for redeemed preferred stock(3)	—		—		—		—		(34)		—		**		—		(46)		**
Net income available to common stockholders	$	1,161	$	1,616	$	1,949	$	2,318	$	2,296	(28)		(49)		$	7,044	$	11,965	(41)
Common Share Statistics
Basic earnings per common share:(2)
Net income from continuing operations	$	3.03	$	4.21	$	4.98	$	5.65	$	5.43	(28)	%	(44)	%	$	17.98	$	27.05	(34)	%
Income (loss) from discontinued operations	—		—		—		—		—		—		—		—		(0.01)		**
Net income per basic common share	$	3.03	$	4.21	$	4.98	$	5.65	$	5.43	(28)		(44)		$	17.98	$	27.04	(34)
Diluted earnings per common share:(2)
Net income from continuing operations	$	3.03	$	4.20	$	4.96	$	5.62	$	5.41	(28)	%	(44)	%	$	17.91	$	26.95	(34)	%
Income (loss) from discontinued operations	—		—		—		—		—		—		—		—		(0.01)		**
Net income per diluted common share	$	3.03	$	4.20	$	4.96	$	5.62	$	5.41	(28)		(44)		$	17.91	$	26.94	(34)
Weighted-average common shares outstanding (in millions):
Basic	382.6		383.4		391.2		410.4		422.5		—		(9)	%	391.8		442.5		(11)	%
Diluted	383.7		384.6		392.6		412.2		424.3		—		(10)		393.2		444.2		(11)
Common shares outstanding (period-end, in millions)	381.3		382.0		383.8		399.0		413.9		—		(8)		381.3		413.9		(8)
Dividends declared and paid per common share	$	0.60	$	0.60	$	0.60	$	0.60	$	0.60	—		—		$	2.40	$	2.60	(8)
Tangible book value per common share (period-end)(4)	86.11		81.38		87.84		91.77		99.74		6%		(14)		86.11		99.74		(14)


											2022 Q4 vs.		Year Ended December 31,
(Dollars in millions)	2022		2022		2022		2022		2021		2022	2021					2022 vs.
	Q4		Q3		Q2		Q1		Q4		Q3	Q4	2022		2021		2021
Balance Sheet (Period-End)
Loans held for investment	$	312,331	$	303,943	$	296,384	$	280,466	$	277,340	3%	13%	$	312,331	$	277,340	13%
Interest-earning assets	427,248		415,262		406,565		398,241		397,341		3	8	427,248		397,341		8
Total assets	455,249		444,232		440,288		434,195		432,381		2	5	455,249		432,381		5
Interest-bearing deposits	300,789		282,802		270,881		275,648		272,937		6	10	300,789		272,937		10
Total deposits	332,992		317,193		307,885		313,429		310,980		5	7	332,992		310,980		7
Borrowings	48,715		54,607		58,938		45,358		43,086		(11)	13	48,715		43,086		13
Common equity	47,737		46,015		48,564		51,499		56,184		4	(15)	47,737		56,184		(15)
Total stockholders’ equity	52,582		50,861		53,410		56,345		61,029		3	(14)	52,582		61,029		(14)
Balance Sheet (Average Balances)
Loans held for investment	$	306,881	$	300,186	$	286,110	$	275,342	$	267,159	2%	15%	$	292,238	$	252,730	16%
Interest-earning assets	421,051		412,171		398,934		394,082		390,868		2	8	406,646		389,336		4
Total assets	449,659		447,088		435,327		430,372		427,845		1	5	440,538		424,521		4
Interest-bearing deposits	292,793		275,900		268,104		271,823		269,951		6	8	277,208		271,500		2
Total deposits	326,558		311,928		305,954		309,597		307,272		5	6	313,551		306,397		2
Borrowings	49,747		58,628		53,208		42,277		39,943		(15)	25	51,006		38,590		32
Common equity	47,594		49,696		49,319		54,591		56,946		(4)	(16)	50,279		56,966		(12)
Total stockholders’ equity	52,439		54,541		54,165		59,437		62,498		(4)	(16)	55,125		62,556		(12)

CAPITAL ONE FINANCIAL CORPORATION (COF)

Table 2: Selected Metrics—Consolidated


																2022 Q4 vs.				Year Ended December 31,
(Dollars in millions, except as noted)	2022			2022			2022			2022			2021			2022		2021								2022 vs.
	Q4			Q3			Q2			Q1			Q4			Q3		Q4		2022			2021			2021
Performance Metrics
Net interest income growth (period over period)	3		%	7		%	2		%	(1)		%	5		%	**		**		12		%	5		%	**
Non-interest income growth (period over period)	2			5			(3)			6			—			**		**		14			12			**
Total net revenue growth (period over period)	3			7			1			1			4			**		**		13			7			**
Total net revenue margin(5)	8.59			8.55			8.25			8.30			8.31			4	bps	28	bps	8.42			7.82			60	bps
Net interest margin(6)	6.84			6.80			6.54			6.49			6.60			4		24		6.67			6.21			46
Return on average assets	1.10			1.52			1.87			2.23			2.27			(42)		(117)		1.67			2.92			(125)
Return on average tangible assets(7)	1.13			1.57			1.93			2.31			2.35			(44)		(122)		1.73			3.03			(130)
Return on average common equity(8)	9.76			13.01			15.81			16.98			16.13			(325)		(6)%		14.01			21.01			(7)%
Return on average tangible common equity(9)	14.22			18.59			22.63			23.36			21.82			(4)%		(8)		19.91			28.39			(8)

Efficiency ratio(10)	56.19			56.21			55.67			55.68			57.63			(2)	bps	(144)	bps	55.95			54.44			151	bps
Operating efficiency ratio(11)	43.83			45.10			43.49			44.45			45.32			(127)		(149)		44.22			45.01			(79)
Effective income tax rate for continuing operations	20.2			22.5			20.8			18.4			20.7			(230)		(50)		20.3			21.6			(130)
Employees (period-end, in thousands)	56.0			55.1			53.6			51.5			50.8			2%		10%		56.0			50.8			10%
Credit Quality Metrics
Allowance for credit losses	$	13,240		$	12,209		$	11,491		$	11,308		$	11,430		8%		16%		$	13,240		$	11,430		16%
Allowance coverage ratio	4.24		%	4.02		%	3.88		%	4.03		%	4.12		%	22	bps	12	bps	4.24		%	4.12		%	12	bps
Net charge-offs	$	1,430		$	931		$	845		$	767		$	527		54%		171%		$	3,973		$	2,234		78%
Net charge-off rate(12)	1.86		%	1.24		%	1.18		%	1.11		%	0.79		%	62	bps	107	bps	1.36		%	0.88		%	48	bps
30+ day performing delinquency rate	2.96			2.58			2.36			2.08			2.25			38		71		2.96			2.25			71
30+ day delinquency rate	3.21			2.78			2.54			2.21			2.41			43		80		3.21			2.41			80
Capital Ratios(13)
Common equity Tier 1 capital	12.5		%	12.2		%	12.1		%	12.7		%	13.1		%	30	bps	(60)	bps	12.5		%	13.1		%	(60)	bps
Tier 1 capital	13.9			13.6			13.5			14.1			14.5			30		(60)		13.9			14.5			(60)
Total capital	15.8			15.7			15.7			16.4			16.9			10		(110)		15.8			16.9			(110)
Tier 1 leverage	11.1			11.0			11.1			11.3			11.6			10		(50)		11.1			11.6			(50)
Tangible common equity (“TCE”)(14)	7.5			7.2			7.9			8.7			9.9			30		(240)		7.5			9.9			(240)

CAPITAL ONE FINANCIAL CORPORATION (COF)

Table 3: Consolidated Statements of Income


											2022 Q4 vs.				Year Ended December 31,
(Dollars in millions, except as noted)	2022		2022		2022		2022		2021		2022		2021						2022 vs.
	Q4		Q3		Q2		Q1		Q4		Q3		Q4		2022		2021		2021
Interest income:
Loans, including loans held for sale	$	8,360	$	7,578	$	6,605	$	6,367	$	6,451	10	%	30	%	$	28,910	$	24,263	19	%
Investment securities	548		499		435		402		368		10		49		1,884		1,446		30
Other	250		123		55		15		12		103		**		443		60		**
Total interest income	9,158		8,200		7,095		6,784		6,831		12		34		31,237		25,769		21
Interest expense:
Deposits	1,335		689		293		218		222		94		**		2,535		956		165
Securitized debt obligations	170		120		65		29		30		42		**		384		119		**
Senior and subordinated notes	430		319		194		131		121		35		**		1,074		488		120
Other borrowings	26		69		26		9		8		(62)		**		130		35		**
Total interest expense	1,961		1,197		578		387		381		64		**		4,123		1,598		158
Net interest income	7,197		7,003		6,517		6,397		6,450		3		12		27,114		24,171		12
Provision (benefit) for credit losses	2,416		1,669		1,085		677		381		45		**		5,847		(1,944)		**
Net interest income after provision for credit losses	4,781		5,334		5,432		5,720		6,069		(10)		(21)		21,267		26,115		(19)
Non-interest income:
Interchange fees, net	1,177		1,195		1,201		1,033		1,005		(2)		17		4,606		3,860		19
Service charges and other customer-related fees	395		415		415		400		435		(5)		(9)		1,625		1,578		3

Other	271		192		99		343		228		41		19		905		826		10
Total non-interest income	1,843		1,802		1,715		1,776		1,668		2		10		7,136		6,264		14
Non-interest expense:
Salaries and associate benefits	2,266		2,187		1,946		2,026		1,941		4		17		8,425		7,421		14
Occupancy and equipment	554		502		481		513		527		10		5		2,050		2,003		2
Marketing	1,118		978		1,003		918		999		14		12		4,017		2,871		40
Professional services	481		471		458		397		449		2		7		1,807		1,440		25
Communications and data processing	352		349		339		339		326		1		8		1,379		1,262		9
Amortization of intangibles	25		17		14		14		13		47		92		70		29		141
Other	284		445		342		344		423		(36)		(33)		1,415		1,544		(8)
Total non-interest expense	5,080		4,949		4,583		4,551		4,678		3		9		19,163		16,570		16
Income from continuing operations before income taxes	1,544		2,187		2,564		2,945		3,059		(29)		(50)		9,240		15,809		(42)
Income tax provision	312		493		533		542		633		(37)		(51)		1,880		3,415		(45)
Income from continuing operations, net of tax	1,232		1,694		2,031		2,403		2,426		(27)		(49)		7,360		12,394		(41)
Income (loss) from discontinued operations, net of tax	—		—		—		—		(1)		—		**		—		(4)		**
Net income	1,232		1,694		2,031		2,403		2,425		(27)		(49)		7,360		12,390		(41)
Dividends and undistributed earnings allocated to participating securities(2)	(14)		(21)		(25)		(28)		(21)		(33)		(33)		(88)		(105)		(16)
Preferred stock dividends	(57)		(57)		(57)		(57)		(74)		—		(23)		(228)		(274)		(17)
Issuance cost for redeemed preferred stock(3)	—		—		—		—		(34)		—		**		—		(46)		**
Net income available to common stockholders	$	1,161	$	1,616	$	1,949	$	2,318	$	2,296	(28)		(49)		$	7,044	$	11,965	(41)



											2022 Q4 vs.				Year Ended December 31,
	2022		2022		2022		2022		2021		2022		2021						2022 vs.
	Q4		Q3		Q2		Q1		Q4		Q3		Q4		2022		2021		2021
Basic earnings per common share:(2)
Net income from continuing operations	$	3.03	$	4.21	$	4.98	$	5.65	$	5.43	(28)	%	(44)	%	$	17.98	$	27.05	(34)	%
Income (loss) from discontinued operations	—		—		—		—		—		—		—		—		(0.01)		**
Net income per basic common share	$	3.03	$	4.21	$	4.98	$	5.65	$	5.43	(28)		(44)		$	17.98	$	27.04	(34)
Diluted earnings per common share:(2)
Net income from continuing operations	$	3.03	$	4.20	$	4.96	$	5.62	$	5.41	(28)		(44)		$	17.91	$	26.95	(34)
Income (loss) from discontinued operations	—		—		—		—		—		—		—		—		(0.01)		**
Net income per diluted common share	$	3.03	$	4.20	$	4.96	$	5.62	$	5.41	(28)		(44)		$	17.91	$	26.94	(34)
Weighted-average common shares outstanding (in millions):
Basic common shares	382.6		383.4		391.2		410.4		422.5		—		(9)		391.8		442.5		(11)
Diluted common shares	383.7		384.6		392.6		412.2		424.3		—		(10)		393.2		444.2		(11)

CAPITAL ONE FINANCIAL CORPORATION (COF)

Table 4: Consolidated Balance Sheets


											2022 Q4 vs.
	2022		2022		2022		2022		2021		2022		2021
(Dollars in millions)	Q4		Q3		Q2		Q1		Q4		Q3		Q4
Assets:
Cash and cash equivalents:
Cash and due from banks	$	5,193	$	3,716	$	4,825	$	5,107	$	4,164	40	%	25	%
Interest-bearing deposits and other short-term investments	25,663		21,176		16,728		21,697		17,582		21		46
Total cash and cash equivalents	30,856		24,892		21,553		26,804		21,746		24		42
Restricted cash for securitization investors	400		399		697		281		308		—		30
Securities available for sale	76,919		75,303		83,022		89,076		95,261		2		(19)
Loans held for investment:
Unsecuritized loans held for investment	283,282		277,576		271,339		257,505		252,468		2		12
Loans held in consolidated trusts	29,049		26,367		25,045		22,961		24,872		10		17
Total loans held for investment	312,331		303,943		296,384		280,466		277,340		3		13
Allowance for credit losses	(13,240)		(12,209)		(11,491)		(11,308)		(11,430)		8		16
Net loans held for investment	299,091		291,734		284,893		269,158		265,910		3		12
Loans held for sale	203		1,729		875		1,155		5,888		(88)		(97)
Premises and equipment, net	4,351		4,265		4,238		4,238		4,210		2		3
Interest receivable	2,104		1,853		1,611		1,479		1,460		14		44
Goodwill	14,777		14,771		14,778		14,784		14,782		—		—
Other assets	26,548		29,286		28,621		27,220		22,816		(9)		16
Total assets	$	455,249	$	444,232	$	440,288	$	434,195	$	432,381	2		5


											2022 Q4 vs.
	2022		2022		2022		2022		2021		2022		2021
(Dollars in millions)	Q4		Q3		Q2		Q1		Q4		Q3		Q4
Liabilities:
Interest payable	$	527	$	433	$	333	$	261	$	281	22	%	88	%
Deposits:
Non-interest-bearing deposits	32,203		34,391		37,004		37,781		38,043		(6)		(15)
Interest-bearing deposits	300,789		282,802		270,881		275,648		272,937		6		10
Total deposits	332,992		317,193		307,885		313,429		310,980		5		7
Securitized debt obligations	16,973		15,926		17,466		13,740		14,994		7		13
Other debt:
Federal funds purchased and securities loaned or sold under agreements to repurchase	883		528		440		594		820		67		8
Senior and subordinated notes	30,826		30,615		30,489		26,976		27,219		1		13
Other borrowings	33		7,538		10,543		4,048		53		(100)		(38)
Total other debt	31,742		38,681		41,472		31,618		28,092		(18)		13
Other liabilities	20,433		21,138		19,722		18,802		17,005		(3)		20
Total liabilities	402,667		393,371		386,878		377,850		371,352		2		8

Stockholders’ equity:
Preferred stock	0		0		0		0		0		—		—
Common stock	7		7		7		7		7		—		—
Additional paid-in capital, net	34,725		34,579		34,425		34,286		34,112		—		2
Retained earnings	57,184		56,240		54,836		53,099		51,006		2		12
Accumulated other comprehensive income (loss)	(9,916)		(10,704)		(6,916)		(4,093)		374		(7)		**
Treasury stock, at cost	(29,418)		(29,261)		(28,942)		(26,954)		(24,470)		1		20
Total stockholders’ equity	52,582		50,861		53,410		56,345		61,029		3		(14)
Total liabilities and stockholders’ equity	$	455,249	$	444,232	$	440,288	$	434,195	$	432,381	2		5

CAPITAL ONE FINANCIAL CORPORATION (COF)

Table 5: Notes to Financial Summary, Selected Metrics and Consolidated Financial Statements (Tables 1—4)

(1)Total net revenue was reduced by $321 million in Q4 2022, $222 million in Q3 2022, $211 million in Q2 2022, $192 million in Q1 2022 and $151 million in Q4 2021 for credit card finance charges and fees charged-off as uncollectible.

(2)Dividends and undistributed earnings allocated to participating securities and earnings per share are computed independently for each period. Accordingly, the sum of each quarterly amount may not agree to the year-to-date total. We also provide adjusted diluted earnings per share, which is a non-GAAP measure. See “Table 15: Calculation of Regulatory Capital Measures and Reconciliation of Non-GAAP Measures” for additional information on our non-GAAP measures.

(3)On September 1, 2021, we redeemed all outstanding shares of our fixed-to-floating rate non-cumulative perpetual preferred stock Series E, which reduced our net income available to common shareholders by $12 million in Q3 2021. On December 1, 2021, we redeemed all outstanding shares of our fixed rate 5.20% non-cumulative perpetual preferred stock Series G and our fixed rate 6.00% non-cumulative perpetual preferred stock Series H, which together reduced our net income available to common shareholders by $34 million in Q4 2021.

(4)Tangible book value per common share is a non-GAAP measure calculated based on TCE divided by common shares outstanding. See “Table 15: Calculation of Regulatory Capital Measures and Reconciliation of Non-GAAP Measures” for additional information on non-GAAP measures.

(5)Total net revenue margin is calculated based on total net revenue for the period divided by average interest-earning assets for the period.

(6)Net interest margin is calculated based on annualized net interest income for the period divided by average interest-earning assets for the period.

(7)Return on average tangible assets is a non-GAAP measure calculated based on annualized income (loss) from continuing operations, net of tax, for the period divided by average tangible assets for the period. See “Table 15: Calculation of Regulatory Capital Measures and Reconciliation of Non-GAAP Measures” for additional information on non-GAAP measures.

(8)Return on average common equity is calculated based on net income (loss) available to common stockholders less income (loss) from discontinued operations, net of tax, for the period, divided by average common equity. Our calculation of return on average common equity may not be comparable to similarly-titled measures reported by other companies.

(9)Return on average tangible common equity is a non-GAAP measure calculated based on net income (loss) available to common stockholders less income (loss) from discontinued operations, net of tax, for the period, divided by average TCE. See “Table 15: Calculation of Regulatory Capital Measures and Reconciliation of Non-GAAP Measures” for additional information on non-GAAP measures.

(10)Efficiency ratio is calculated based on total non-interest expense for the period divided by total net revenue for the period. We also provide an adjusted efficiency ratio, which is a non-GAAP measure. See “Table 15: Calculation of Regulatory Capital Measures and Reconciliation of Non-GAAP Measures” for additional information on our non-GAAP measures.

(11)Operating efficiency ratio is calculated based on operating expense for the period divided by total net revenue for the period. We also provide an adjusted operating efficiency ratio, which is a non-GAAP measure. See “Table 15: Calculation of Regulatory Capital Measures and Reconciliation of Non-GAAP Measures” for additional information on our non-GAAP measures.

(12)Net charge-off rate is calculated based on annualized net charge-offs for the period divided by average loans held for investment for the period.

(13)Capital ratios as of the end of Q4 2022 are preliminary and therefore subject to change. See “Table 15: Calculation of Regulatory Capital Measures and Reconciliation of Non-GAAP Measures” for information on the calculation of each of these ratios.

(14)TCE ratio is a non-GAAP measure calculated based on TCE divided by tangible assets. See “Table 15: Calculation of Regulatory Capital Measures and Reconciliation of Non-GAAP Measures” for additional information on non-GAAP measures.

** Not meaningful.

CAPITAL ONE FINANCIAL CORPORATION (COF)

Table 6: Average Balances, Net Interest Income and Net Interest Margin


	2022 Q4						2022 Q3						2021 Q4
(Dollars in millions, except as noted)	Average Balance		Interest Income/ Expense		Yield/Rate(1)		Average Balance		Interest Income/ Expense		Yield/Rate(1)		Average Balance		Interest Income/ Expense		Yield/Rate
Interest-earning assets:
Loans, including loans held for sale	$	307,852	$	8,360	10.86	%	$	300,952	$	7,578	10.07	%	$	272,805	$	6,451	9.46	%
Investment securities	87,110		548		2.52		88,666		499		2.25		96,421		368		1.53
Cash equivalents and other	26,089		250		3.84		22,553		123		2.19		21,642		12		0.22
Total interest-earning assets	$	421,051	$	9,158	8.70		$	412,171	$	8,200	7.96		$	390,868	$	6,831	6.99
Interest-bearing liabilities:
Interest-bearing deposits	$	292,793	$	1,335	1.82		$	275,900	$	689	1.00		$	269,951	$	222	0.33
Securitized debt obligations	16,478		170		4.13		17,108		120		2.81		13,775		30		0.87
Senior and subordinated notes	30,718		430		5.59		30,962		319		4.13		25,454		121		1.90
Other borrowings and liabilities	4,289		26		2.50		12,296		69		2.20		2,279		8		1.50
Total interest-bearing liabilities	$	344,278	$	1,961	2.28		$	336,266	$	1,197	1.42		$	311,459	$	381	0.49
Net interest income/spread			$	7,197	6.42				$	7,003	6.53				$	6,450	6.50
Impact of non-interest-bearing funding					0.42						0.27						0.10
Net interest margin					6.84	%					6.80	%					6.60	%



	Year Ended December 31,
	2022						2021
(Dollars in millions, except as noted)	Average Balance		Interest Income/ Expense		Yield/Rate(1)		Average Balance		Interest Income/ Expense		Yield/Rate
Interest-earning assets:
Loans, including loans held for sale	$	293,839	$	28,910	9.84	%	$	257,328	$	24,263	9.43	%
Investment securities	90,608		1,884		2.08		98,394		1,446		1.47
Cash equivalents and other	22,199		443		2.00		33,614		60		0.18
Total interest-earning assets	$	406,646	$	31,237	7.68		$	389,336	$	25,769	6.62
Interest-bearing liabilities:
Interest-bearing deposits	$	277,208	$	2,535	0.91		$	271,500	$	956	0.35
Securitized debt obligations	15,603		384		2.46		12,336		119		0.96
Senior and subordinated notes	29,286		1,074		3.67		25,530		488		1.91
Other borrowings and liabilities	7,800		130		1.67		2,261		35		1.57
Total interest-bearing liabilities	$	329,897	$	4,123	1.25		$	311,627	$	1,598	0.51
Net interest income/spread			$	27,114	6.43				$	24,171	6.11
Impact of non-interest-bearing funding					0.24						0.10
Net interest margin					6.67	%					6.21	%

CAPITAL ONE FINANCIAL CORPORATION (COF)

Table 7: Loan Information and Performance Statistics


											2022 Q4 vs.				Year Ended December 31,
	2022		2022		2022		2022		2021		2022		2021		2022		2021		2022 vs. 2021
(Dollars in millions, except as noted)	Q4		Q3		Q2		Q1		Q4		Q3		Q4
Loans Held for Investment (Period-End)
Credit card:
Domestic credit card	$	131,581	$	121,279	$	115,004	$	107,987	$	108,723	8	%	21	%	$	131,581	$	108,723	21	%
International card businesses	6,149		5,634		5,876		5,975		6,049		9		2		6,149		6,049		2
Total credit card	137,730		126,913		120,880		113,962		114,772		9		20		137,730		114,772		20
Consumer banking:
Auto	78,373		79,580		79,926		78,604		75,779		(2)		3		78,373		75,779		3
Retail banking	1,552		1,619		1,605		1,726		1,867		(4)		(17)		1,552		1,867		(17)
Total consumer banking	79,925		81,199		81,531		80,330		77,646		(2)		3		79,925		77,646		3
Commercial banking:
Commercial and multifamily real estate	37,453		38,225		37,845		34,354		35,262		(2)		6		37,453		35,262		6
Commercial and industrial	57,223		57,606		56,128		51,820		49,660		(1)		15		57,223		49,660		15
Total commercial banking	94,676		95,831		93,973		86,174		84,922		(1)		11		94,676		84,922		11

Total loans held for investment	$	312,331	$	303,943	$	296,384	$	280,466	$	277,340	3		13		$	312,331	$	277,340	13
Loans Held for Investment (Average)
Credit card:
Domestic credit card	$	124,816	$	117,467	$	109,962	$	105,536	$	102,717	6	%	22	%	$	114,506	$	95,818	20	%
International card businesses	5,836		5,890		5,873		5,944		5,871		(1)		(1)		5,886		6,913		(15)
Total credit card	130,652		123,357		115,835		111,480		108,588		6		20		120,392		102,731		17
Consumer banking:
Auto	79,108		79,741		79,313		76,892		75,284		(1)		5		78,772		71,108		11
Retail banking	1,592		1,598		1,668		1,797		2,160		—		(26)		1,663		2,765		(40)
Total consumer banking	80,700		81,339		80,981		78,689		77,444		(1)		4		80,435		73,873		9
Commercial banking:
Commercial and multifamily real estate	37,848		38,230		35,754		34,671		33,591		(1)		13		36,639		30,980		18
Commercial and industrial	57,681		57,260		53,540		50,502		47,536		1		21		54,772		45,146		21
Total commercial banking	95,529		95,490		89,294		85,173		81,127		—		18		91,411		76,126		20
Total average loans held for investment	$	306,881	$	300,186	$	286,110	$	275,342	$	267,159	2		15		$	292,238	$	252,730	16


											2022 Q4 vs.				Year Ended December 31,
	2022		2022		2022		2022		2021		2022		2021		2022		2021		2022 vs. 2021
	Q4		Q3		Q2		Q1		Q4		Q3		Q4
Net Charge-Off (Recovery) Rates
Credit card:
Domestic credit card(2)	3.22	%	2.20	%	2.26	%	2.12	%	1.49	%	102	bps	173	bps	2.47	%	1.90	%	57	bps
International card businesses	4.29		3.30		3.82		3.20		0.14		99		415		3.65		1.96		169
Total credit card	3.27		2.25		2.34		2.18		1.42		102		185		2.53		1.90		63
Consumer banking:
Auto	1.66		1.05		0.61		0.66		0.58		61		108		1.00		0.28		72
Retail banking	5.15		3.89		3.62		4.31		6.69		126		(154)		4.24		2.77		147
Total consumer banking	1.73		1.10		0.67		0.75		0.75		63		98		1.06		0.37		69
Commercial banking:
Commercial and multifamily real estate	0.05		0.03		(0.08)		—		—		2		5		—		0.03		(3)
Commercial and industrial	0.06		0.06		0.29		0.11		(0.03)		—		9		0.13		(0.01)		14
Total commercial banking	0.06		0.05		0.14		0.06		(0.02)		1		8		0.08		—		8
Total net charge-offs	1.86		1.24		1.18		1.11		0.79		62		107		1.36		0.88		48
30+ Day Performing Delinquency Rates
Credit card:
Domestic credit card	3.43	%	2.97	%	2.35	%	2.32	%	2.22	%	46	bps	121	bps	3.43	%	2.22	%	121	bps
International card businesses	4.03		3.90		3.67		3.58		3.42		13		61		4.03		3.42		61
Total credit card	3.46		3.01		2.42		2.38		2.28		45		118		3.46		2.28		118
Consumer banking:
Auto	5.62		4.85		4.47		3.85		4.32		77		130		5.62		4.32		130
Retail banking	1.02		0.84		0.67		0.74		1.92		18		(90)		1.02		1.92		(90)
Total consumer banking	5.53		4.77		4.39		3.78		4.26		76		127		5.53		4.26		127
Nonperforming Loans and Nonperforming Assets Rates(3)(4)
Credit card:
International card businesses	0.14	%	0.14	%	0.13	%	0.14	%	0.16	%	—		(2)	bps	0.14	%	0.16	%	(2)	bps
Total credit card	0.01		0.01		0.01		0.01		0.01		—		—		0.01		0.01		—
Consumer banking:
Auto	0.76		0.60		0.50		0.41		0.45		16	bps	31		0.76		0.45		31
Retail banking	2.49		2.62		2.61		2.63		2.51		(13)		(2)		2.49		2.51		(2)
Total consumer banking	0.79		0.64		0.54		0.46		0.50		15		29		0.79		0.50		29
Commercial banking:
Commercial and multifamily real estate	0.72		0.64		0.78		0.98		1.09		8		(37)		0.72		1.09		(37)
Commercial and industrial	0.75		0.53		0.64		0.69		0.64		22		11		0.75		0.64		11
Total commercial banking	0.74		0.57		0.70		0.81		0.82		17		(8)		0.74		0.82		(8)
Total nonperforming loans	0.43		0.35		0.37		0.38		0.40		8		3		0.43		0.40		3
Total nonperforming assets	0.45		0.37		0.39		0.40		0.41		8		4		0.45		0.41		4

CAPITAL ONE FINANCIAL CORPORATION (COF)

Table 8: Allowance for Credit Losses and Reserve for Unfunded Lending Commitments Activity



	Three Months Ended December 31, 2022
	Credit Card						Consumer Banking
(Dollars in millions)	Domestic Card		International Card Businesses		Total Credit Card		Auto		Retail Banking		Total Consumer Banking		Commercial Banking		Total
Allowance for credit losses:
Balance as of September 30, 2022	$	8,370	$	346	$	8,716	$	2,057	$	51	$	2,108	$	1,385	$	12,209
Charge-offs	(1,257)		(94)		(1,351)		(499)		(25)		(524)		(15)		(1,890)
Recoveries	252		31		283		171		5		176		1		460
Net charge-offs	(1,005)		(63)		(1,068)		(328)		(20)		(348)		(14)		(1,430)
Provision for credit losses	1,800		78		1,878		458		19		477		87		2,442
Allowance build for credit losses	795		15		810		130		(1)		129		73		1,012
Other changes(5)	—		19		19		—		—		—		—		19
Balance as of December 31, 2022	9,165		380		9,545		2,187		50		2,237		1,458		13,240
Reserve for unfunded lending commitments:
Balance as of September 30, 2022	—		—		—		—		—		—		243		243
Provision (benefit) for losses on unfunded lending commitments	—		—		—		—		—		—		(25)		(25)

Balance as of December 31, 2022	—		—		—		—		—		—		218		218
Combined allowance and reserve as of December 31, 2022	$	9,165	$	380	$	9,545	$	2,187	$	50	$	2,237	$	1,676	$	13,458



	Year Ended December 31, 2022
	Credit Card						Consumer Banking
(Dollars in millions)	Domestic Card		International Card Businesses		Total Credit Card		Auto		Retail Banking		Total Consumer Banking		Commercial Banking		Total
Allowance for credit losses:
Balance as of December 31, 2021	$	7,968	$	377	$	8,345	$	1,852	$	66	$	1,918	$	1,167	$	11,430
Charge-offs	(4,004)		(358)		(4,362)		(1,525)		(89)		(1,614)		(88)		(6,064)
Recoveries	1,171		143		1,314		741		19		760		17		2,091
Net charge-offs	(2,833)		(215)		(3,048)		(784)		(70)		(854)		(71)		(3,973)
Provision for credit losses	4,020		245		4,265		1,119		54		1,173		362		5,800
Allowance build (release) for credit losses	1,187		30		1,217		335		(16)		319		291		1,827
Other changes(5)	10		(27)		(17)		—		—		—		—		(17)
Balance as of December 31, 2022	9,165		380		9,545		2,187		50		2,237		1,458		13,240
Reserve for unfunded lending commitments:
Balance as of December 31, 2021	—		—		—		—		—		—		165		165


Provision (benefit) for losses on unfunded lending commitments	—		—		—		—		—		—		53		53

Balance as of December 31, 2022	—		—		—		—		—		—		218		218
Combined allowance and reserve as of December 31, 2022	$	9,165	$	380	$	9,545	$	2,187	$	50	$	2,237	$	1,676	$	13,458

CAPITAL ONE FINANCIAL CORPORATION (COF)

Table 9: Financial Summary—Business Segment Results


	Three Months Ended December 31, 2022										Year Ended December 31, 2022
(Dollars in millions)	Credit Card		Consumer Banking		Commercial Banking(6)		Other(6)		Total		Credit Card		Consumer Banking		Commercial Banking(6)		Other(6)		Total
Net interest income (loss)	$	4,533	$	2,394	$	520	$	(250)	$	7,197	$	16,584	$	8,965	$	2,461	$	(896)	$	27,114
Non-interest income (loss)	1,449		139		261		(6)		1,843		5,771		469		1,129		(233)		7,136
Total net revenue (loss)	5,982		2,533		781		(256)		9,040		22,355		9,434		3,590		(1,129)		34,250
Provision (benefit) for credit losses	1,878		477		62		(1)		2,416		4,265		1,173		415		(6)		5,847
Non-interest expense	3,069		1,450		555		6		5,080		11,627		5,312		2,070		154		19,163
Income (loss) from continuing operations before income taxes	1,035		606		164		(261)		1,544		6,463		2,949		1,105		(1,277)		9,240
Income tax provision (benefit)	245		144		39		(116)		312		1,536		699		262		(617)		1,880
Income (loss) from continuing operations, net of tax	$	790	$	462	$	125	$	(145)	$	1,232	$	4,927	$	2,250	$	843	$	(660)	$	7,360

	Three Months Ended September 30, 2022
(Dollars in millions)	Credit Card		Consumer Banking		Commercial Banking(6)		Other(6)		Total
Net interest income (loss)	$	4,313	$	2,311	$	699	$	(320)	$	7,003
Non-interest income (loss)	1,454		129		319		(100)		1,802
Total net revenue (loss)	5,767		2,440		1,018		(420)		8,805
Provision (benefit) for credit losses	1,261		285		123		—		1,669
Non-interest expense	3,004		1,340		542		63		4,949
Income (loss) from continuing operations before income taxes	1,502		815		353		(483)		2,187
Income tax provision (benefit)	356		193		83		(139)		493
Income (loss) from continuing operations, net of tax	$	1,146	$	622	$	270	$	(344)	$	1,694

	Three Months Ended December 31, 2021										Year Ended December 31, 2021
(Dollars in millions)	Credit Card		Consumer Banking		Commercial Banking(6)		Other(6)		Total		Credit Card		Consumer Banking		Commercial Banking(6)		Other(6)		Total
Net interest income (loss)	$	3,865	$	2,158	$	595	$	(168)	$	6,450	$	14,074	$	8,448	$	2,153	$	(504)	$	24,171
Non-interest income (loss)	1,261		142		345		(80)		1,668		4,806		554		1,148		(244)		6,264
Total net revenue (loss)	5,126		2,300		940		(248)		8,118		18,880		9,002		3,301		(748)		30,435
Provision (benefit) for credit losses	423		2		(44)		—		381		(902)		(521)		(519)		(2)		(1,944)
Non-interest expense	2,799		1,285		520		74		4,678		9,621		4,711		1,815		423		16,570
Income (loss) from continuing operations before income taxes	1,904		1,013		464		(322)		3,059		10,161		4,812		2,005		(1,169)		15,809
Income tax provision (benefit)	451		239		109		(166)		633		2,403		1,136		473		(597)		3,415
Income (loss) from continuing operations, net of tax	$	1,453	$	774	$	355	$	(156)	$	2,426	$	7,758	$	3,676	$	1,532	$	(572)	$	12,394

CAPITAL ONE FINANCIAL CORPORATION (COF)

Table 10: Financial & Statistical Summary—Credit Card Business


																2022 Q4 vs.				Year Ended December 31,
	2022			2022			2022			2022			2021			2022		2021								2022 vs.
(Dollars in millions, except as noted)	Q4			Q3			Q2			Q1			Q4			Q3		Q4		2022			2021			2021
Credit Card
Earnings:
Net interest income	$	4,533		$	4,313		$	3,899		$	3,839		$	3,865		5%		17%		$	16,584		$	14,074		18%
Non-interest income	1,449			1,454			1,410			1,458			1,261			—		15		5,771			4,806			20
Total net revenue	5,982			5,767			5,309			5,297			5,126			4		17		22,355			18,880			18
Provision (benefit) for credit losses	1,878			1,261			581			545			423			49		**		4,265			(902)			**
Non-interest expense	3,069			3,004			2,771			2,783			2,799			2		10		11,627			9,621			21
Income from continuing operations before income taxes	1,035			1,502			1,957			1,969			1,904			(31)		(46)		6,463			10,161			(36)
Income tax provision	245			356			466			469			451			(31)		(46)		1,536			2,403			(36)
Income from continuing operations, net of tax	$	790		$	1,146		$	1,491		$	1,500		$	1,453		(31)		(46)		$	4,927		$	7,758		(36)
Selected performance metrics:
Period-end loans held for investment	$	137,730		$	126,913		$	120,880		$	113,962		$	114,772		9		20		$	137,730		$	114,772		20
Average loans held for investment	130,652			123,357			115,835			111,480			108,588			6		20		120,392			102,731			17
Average yield on loans outstanding(1)	17.69		%	16.74		%	15.24		%	14.97		%	14.94		%	95	bps	275	bps	16.21		%	14.60		%	161	bps
Total net revenue margin(7)	18.32			18.70			18.33			18.56			18.11			(38)		21		18.47			17.81			66
Net charge-off rate	3.27			2.25			2.34			2.18			1.42			102		185		2.53			1.90			63
30+ day performing delinquency rate	3.46			3.01			2.42			2.38			2.28			45		118		3.46			2.28			118
30+ day delinquency rate	3.46			3.02			2.42			2.39			2.29			44		117		3.46			2.29			117
Nonperforming loan rate(3)	0.01			0.01			0.01			0.01			0.01			—		—		0.01			0.01			—
Purchase volume(8)	$	155,633		$	149,497		$	148,491		$	133,662		$	149,982		4%		4%		$	587,283		$	527,605		11%


																2022 Q4 vs.				Year Ended December 31,
	2022			2022			2022			2022			2021			2022		2021								2022 vs.
(Dollars in millions, except as noted)	Q4			Q3			Q2			Q1			Q4			Q3		Q4		2022			2021			2021
Domestic Card
Earnings:
Net interest income	$	4,280		$	4,065		$	3,651		$	3,620		$	3,558		5%		20%		$	15,616		$	12,916		21%
Non-interest income	1,392			1,383			1,340			1,248			1,190			1		17		5,363			4,532			18
Total net revenue	5,672			5,448			4,991			4,868			4,748			4		19		20,979			17,448			20
Provision (benefit) for credit losses	1,800			1,167			494			559			384			54		**		4,020			(868)			**
Non-interest expense	2,866			2,803			2,594			2,564			2,564			2		12		10,827			8,712			24
Income from continuing operations before income taxes	1,006			1,478			1,903			1,745			1,800			(32)		(44)		6,132			9,604			(36)
Income tax provision	238			351			450			414			424			(32)		(44)		1,453			2,266			(36)
Income from continuing operations, net of tax	$	768		$	1,127		$	1,453		$	1,331		$	1,376		(32)		(44)		$	4,679		$	7,338		(36)
Selected performance metrics:
Period-end loans held for investment	$	131,581		$	121,279		$	115,004		$	107,987		$	108,723		8		21		$	131,581		$	108,723		21
Average loans held for investment	124,816			117,467			109,962			105,536			102,717			6		22		114,506			95,818			20
Average yield on loans outstanding(1)	17.58		%	16.61		%	15.03		%	14.82		%	14.86		%	97	bps	272	bps	16.07		%	14.49		%	158	bps
Total net revenue margin(7)	18.18			18.55			18.16			18.28			18.14			(37)		4		18.28			17.85			43
Net charge-off rate(2)	3.22			2.20			2.26			2.12			1.49			102		173		2.47			1.90			57
30+ day performing delinquency rate	3.43			2.97			2.35			2.32			2.22			46		121		3.43			2.22			121
Purchase volume(8)	$	151,995		$	145,805		$	144,668		$	126,284		$	138,825		4%		9%		$	568,752		$	487,297		17%
Refreshed FICO scores:(9)
Greater than 660	69		%	70		%	70		%	70		%	71		%	(1)		(2)		69		%	71		%	(2)
660 or below	31			30			30			30			29			1		2		31			29			2
Total	100		%	100		%	100		%	100		%	100		%					100		%	100		%

CAPITAL ONE FINANCIAL CORPORATION (COF)

Table 11: Financial & Statistical Summary—Consumer Banking Business


																2022 Q4 vs.				Year Ended December 31,
	2022			2022			2022			2022			2021			2022		2021								2022 vs.
(Dollars in millions, except as noted)	Q4			Q3			Q2			Q1			Q4			Q3		Q4		2022			2021			2021
Consumer Banking
Earnings:
Net interest income	$	2,394		$	2,311		$	2,147		$	2,113		$	2,158		4%		11%		$	8,965		$	8,448		6%
Non-interest income	139			129			96			105			142			8		(2)		469			554			(15)
Total net revenue	2,533			2,440			2,243			2,218			2,300			4		10		9,434			9,002			5
Provision (benefit) for credit losses	477			285			281			130			2			67		**		1,173			(521)			**
Non-interest expense	1,450			1,340			1,286			1,236			1,285			8		13		5,312			4,711			13
Income from continuing operations before income taxes	606			815			676			852			1,013			(26)		(40)		2,949			4,812			(39)
Income tax provision	144			193			160			202			239			(25)		(40)		699			1,136			(38)
Income from continuing operations, net of tax	$	462		$	622		$	516		$	650		$	774		(26)		(40)		$	2,250		$	3,676		(39)
Selected performance metrics:
Period-end loans held for investment	$	79,925		$	81,199		$	81,531		$	80,330		$	77,646		(2)		3		$	79,925		$	77,646		3
Average loans held for investment	80,700			81,339			80,981			78,689			77,444			(1)		4		80,435			73,873			9
Average yield on loans held for investment(1)	7.31		%	7.20		%	7.08		%	7.17		%	7.55		%	11	bps	(24)	bps	7.19		%	7.86		%	(67)	bps
Auto loan originations	$	6,635		$	8,289		$	10,328		$	11,713		$	9,721		(20)%		(32)%		$	36,965		$	43,083		(14)%
Period-end deposits	270,592			256,661			255,904			258,359			256,407			5		6		270,592			256,407			6
Average deposits	262,844			255,843			254,336			255,265			253,372			3		4		257,089			251,676			2
Average deposits interest rate	1.42		%	0.79		%	0.38		%	0.29		%	0.30		%	63	bps	112	bps	0.72		%	0.32		%	40	bps
Net charge-off rate	1.73			1.10			0.67			0.75			0.75			63		98		1.06			0.37			69
30+ day performing delinquency rate	5.53			4.77			4.39			3.78			4.26			76		127		5.53			4.26			127
30+ day delinquency rate	6.18			5.28			4.81			4.13			4.66			90		152		6.18			4.66			152
Nonperforming loan rate(3)	0.79			0.64			0.54			0.46			0.50			15		29		0.79			0.50			29
Nonperforming asset rate(4)	0.87			0.71			0.60			0.52			0.56			16		31		0.87			0.56			31
Auto—At origination FICO scores:(10)
Greater than 660	53		%	52		%	52		%	51		%	50		%	1%		3%		53		%	50		%	3%
621 - 660	20			20			20			20			20			—		—		20			20			—
620 or below	27			28			28			29			30			(1)		(3)		27			30			(3)
Total	100		%	100		%	100		%	100		%	100		%					100		%	100		%

CAPITAL ONE FINANCIAL CORPORATION (COF)

Table 12: Financial & Statistical Summary—Commercial Banking Business


																2022 Q4 vs.				Year Ended December 31,
	2022			2022			2022			2022			2021			2022		2021								2022 vs.
(Dollars in millions, except as noted)	Q4			Q3			Q2			Q1			Q4			Q3		Q4		2022			2021			2021
Commercial Banking
Earnings:
Net Interest Income(11)	$	520		$	699		$	635		$	607		$	595		(26)%		(13)%		$	2,461		$	2,153		14%
Non-interest income	261			319			272			277			345			(18)		(24)		1,129			1,148			(2)
Total net revenue(6)	781			1,018			907			884			940			(23)		(17)		3,590			3,301			9
Provision (benefit) for credit losses	62			123			222			8			(44)			(50)		**		415			(519)			**
Non-interest expense	555			542			485			488			520			2		7		2,070			1,815			14
Income from continuing operations before income taxes	164			353			200			388			464			(54)		(65)		1,105			2,005			(45)
Income tax provision	39			83			48			92			109			(53)		(64)		262			473			(45)
Income from continuing operations, net of tax	$	125		$	270		$	152		$	296		$	355		(54)		(65)		$	843		$	1,532		(45)
Selected performance metrics:
Period-end loans held for investment	$	94,676		$	95,831		$	93,973		$	86,174		$	84,922		(1)		11		$	94,676		$	84,922		11
Average loans held for investment	95,529			95,490			89,294			85,173			81,127			—		18		91,411			76,126			20
Average yield on loans held for investment(1)(6)	5.63		%	4.40		%	3.18		%	2.66		%	2.71		%	123	bps	292	bps	4.02		%	2.74		%	128	bps
Period-end deposits	$	40,808		$	41,058		$	38,844		$	45,232		$	44,809		(1)%		(9)%		$	40,808		$	44,809		(9)%
Average deposits	42,779			39,799			40,536			45,008			44,206			7		(3)		42,018			42,350			(1)
Average deposits interest rate	1.80		%	0.83		%	0.19		%	0.12		%	0.12		%	97	bps	168	bps	0.73		%	0.14		%	59	bps
Net charge-off (recovery) rate	0.06			0.05			0.14			0.06			(0.02)			1		8		0.08			—			8
Nonperforming loan rate(3)	0.74			0.57			0.70			0.81			0.82			17		(8)		0.74			0.82			(8)
Nonperforming asset rate(4)	0.74			0.57			0.70			0.81			0.82			17		(8)		0.74			0.82			(8)
Risk category:(12)
Noncriticized	$	87,620		$	89,559		$	88,349		$	80,586		$	79,014		(2)%		11%		$	87,620		$	79,014		11%
Criticized performing	6,355			5,722			4,969			4,893			5,209			11		22		6,355			5,209			22
Criticized nonperforming	701			550			655			695			699			27		—		701			699			—
Total commercial banking loans	$	94,676		$	95,831		$	93,973		$	86,174		$	84,922		(1)		11		$	94,676		$	84,922		11
Risk category as a percentage of period-end loans held for investment:(12)
Noncriticized	92.55		%	93.46		%	94.01		%	93.51		%	93.05		%	(91)	bps	(50)	bps	92.55		%	93.05		%	(50)	bps
Criticized performing	6.71			5.97			5.29			5.68			6.13			74		58		6.71			6.13			58
Criticized nonperforming	0.74			0.57			0.70			0.81			0.82			17		(8)		0.74			0.82			(8)
Total commercial banking loans	100.00		%	100.00		%	100.00		%	100.00		%	100.00		%					100.00		%	100.00		%

CAPITAL ONE FINANCIAL CORPORATION (COF)

Table 13: Financial & Statistical Summary—Other and Total


											2022 Q4 vs.		Year Ended December 31,
	2022		2022		2022		2022		2021		2022	2021					2022 vs.
(Dollars in millions)	Q4		Q3		Q2		Q1		Q4		Q3	Q4	2022		2021		2021
Other
Earnings:
Net Interest Loss(11)	$	(250)	$	(320)	$	(164)	$	(162)	$	(168)	(22)%	49%	$	(896)	$	(504)	78%
Non-interest loss	(6)		(100)		(63)		(64)		(80)		(94)	(93)	(233)		(244)		(5)
Total net loss(6)	(256)		(420)		(227)		(226)		(248)		(39)	3	(1,129)		(748)		51
Provision (benefit) for credit losses	(1)		—		1		(6)		—		**	**	(6)		(2)		**
Non-interest expense(13)	6		63		41		44		74		(90)	(92)	154		423		(64)
Loss from continuing operations before income taxes	(261)		(483)		(269)		(264)		(322)		(46)	(19)	(1,277)		(1,169)		9
Income tax benefit	(116)		(139)		(141)		(221)		(166)		(17)	(30)	(617)		(597)		3
Loss from continuing operations, net of tax	$	(145)	$	(344)	$	(128)	$	(43)	$	(156)	(58)	(7)	$	(660)	$	(572)	15
Selected performance metrics:
Period-end deposits	$	21,592	$	19,474	$	13,137	$	9,838	$	9,764	11	121	$	21,592	$	9,764	121
Average deposits	20,935		16,286		11,082		9,324		9,694		29	116	14,444		12,371		17
Total
Earnings:
Net interest income	$	7,197	$	7,003	$	6,517	$	6,397	$	6,450	3%	12%	$	27,114	$	24,171	12%
Non-interest income	1,843		1,802		1,715		1,776		1,668		2	10	7,136		6,264		14
Total net revenue	9,040		8,805		8,232		8,173		8,118		3	11	34,250		30,435		13
Provision (benefit) for credit losses	2,416		1,669		1,085		677		381		45	**	5,847		(1,944)		**
Non-interest expense	5,080		4,949		4,583		4,551		4,678		3	9	19,163		16,570		16
Income from continuing operations before income taxes	1,544		2,187		2,564		2,945		3,059		(29)	(50)	9,240		15,809		(42)
Income tax provision	312		493		533		542		633		(37)	(51)	1,880		3,415		(45)
Income from continuing operations, net of tax	$	1,232	$	1,694	$	2,031	$	2,403	$	2,426	(27)	(49)	$	7,360	$	12,394	(41)
Selected performance metrics:
Period-end loans held for investment	$	312,331	$	303,943	$	296,384	$	280,466	$	277,340	3	13	$	312,331	$	277,340	13
Average loans held for investment	306,881		300,186		286,110		275,342		267,159		2	15	292,238		252,730		16
Period-end deposits	332,992		317,193		307,885		313,429		310,980		5	7	332,992		310,980		7
Average deposits	326,558		311,928		305,954		309,597		307,272		5	6	313,551		306,397		2

CAPITAL ONE FINANCIAL CORPORATION (COF)

Table 14: Notes to Net Interest Margin, Loan, Allowance and Business Segment Disclosures (Tables 6—13)

(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. Accordingly, total interest earning assets less total interest bearing liabilities may not total net interest income/spread.

(2)In August 2022, in addition to our normal recovery activity, we sold a pool of charged-off loans that resulted in elevated debt sale recovery activity of approximately $33 million, which decreased the Domestic Credit Card net charge-off rate for the third quarter of 2022 by approximately 11 basis points. Excluding the impact, the Domestic Credit Card net charge-off rate would have been 2.31% for the third quarter of 2022.

(3)Nonperforming loan rates are calculated based on nonperforming loans for each category divided by period-end total loans held for investment for each respective category. For Commercial Banking, loans categorized as nonperforming are considered criticized nonperforming.

(4)Nonperforming assets consist of nonperforming loans, repossessed assets and other foreclosed assets. The total nonperforming asset rate is calculated based on total nonperforming assets divided by the combined period-end total loans held for investment, repossessed assets and other foreclosed assets.

(5)Primarily represents foreign currency translation adjustments and, in periods of acquisition, initial allowance builds for purchase credit-deteriorated loans.

(6)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.

(7)Total net revenue margin is calculated based on annualized total net revenue for the period divided by average loans outstanding during the period.

(8)Purchase volume consists of purchase transactions, net of returns, for the period, and excludes cash advance and balance transfer transactions.

(9)Percentages represent period-end loans held for investment in each credit score category. Domestic Card credit scores generally represent FICO scores. These scores are obtained from one of the major credit bureaus at origination and are refreshed monthly thereafter. We approximate non-FICO credit scores to comparable FICO scores for consistency purposes. Balances for which no credit score is available or the credit score is invalid are included in the 660 or below category.

(10)Percentages represent period-end loans held for investment in each credit score category. Auto credit scores generally represent average FICO scores obtained from three credit bureaus at the time of application and are not refreshed thereafter. Balances for which no credit score is available or the credit score is invalid are included in the 620 or below category.

(11)In the fourth quarter of 2022, an internal funds transfer pricing impact of $176 million decreased net interest income in the Commercial Banking business and increased the Other category, and was therefore neutral to the company.

(12)Criticized exposures correspond to the “Special Mention,” “Substandard” and “Doubtful” asset categories defined by bank regulatory authorities.

(13)Includes charges incurred as a result of restructuring activities.

** Not meaningful.

CAPITAL ONE FINANCIAL CORPORATION (COF)

Table 15: Calculation of Regulatory Capital Measures and Reconciliation of Non-GAAP Measures(1)


	Basel III Standardized Approach
(Dollars in millions, except as noted)	December 31, 2022		September 30, 2022		June 30, 2022		March 31, 2022		December 31, 2021
Regulatory Capital Metrics
Common equity excluding AOCI	$	59,450	$	58,516	$	57,278	$	57,390	$	58,206
Adjustments:
AOCI, net of tax(2)	(17)		(120)		(72)		(20)		(23)
Goodwill, net of related deferred tax liabilities	(14,540)		(14,537)		(14,548)		(14,559)		(14,562)
Other Intangible and deferred tax assets, net of deferred tax liabilities	(162)		(194)		(95)		(110)		(120)
Common equity Tier 1 capital	$	44,731	$	43,665	$	42,563	$	42,701	$	43,501
Tier 1 capital	$	49,576	$	48,510	$	47,408	$	47,547	$	48,346
Total capital(3)	56,715		55,938		55,100		55,059		56,089
Risk-weighted assets	357,939		356,801		351,746		336,739		332,673
Adjusted average assets(4)	444,704		439,479		427,446		418,957		415,141
Capital Ratios
Common equity Tier 1 capital(5)	12.5%		12.2%		12.1%		12.7%		13.1%
Tier 1 capital(6)	13.9		13.6		13.5		14.1		14.5
Total capital(7)	15.8		15.7		15.7		16.4		16.9
Tier 1 leverage(4)	11.1		11.0		11.1		11.3		11.6
TCE(8)	7.5		7.2		7.9		8.7		9.9

Reconciliation of Non-GAAP Measures

The following non-GAAP measures consist of our adjusted results that we believe help investors and users of our financial information understand the effect of adjusting items on our selected reported results, however, they may not be comparable to similarly-titled measures reported by other companies. These adjusted results provide alternate measurements of our operating performance, both for the current period and trends across multiple periods. The following tables present reconciliations of these non-GAAP measures to the applicable amounts measured in accordance with GAAP.


	2022			2022		2022		2022		2021		Year Ended December 31,
(Dollars in millions, except per share data and as noted)	Q4			Q3		Q2		Q1		Q4		2022			2021
Adjusted diluted earnings per share (“EPS”):
Net income available to common stockholders (GAAP)	$	1,161		$	1,616	$	1,949	$	2,318	$	2,296	$	7,044		$	11,965
Insurance recoveries and legal reserve activity	(177)			—		—		—		—		(177)			100
Restructuring Charges	72			—		—		—		—		72			—

Adjusted net income available to common stockholders before income tax impacts (non-GAAP)	1,056			1,616		1,949		2,318		2,296		6,939			12,065
Income tax impacts	25			—		—		—		—		25			(24)

Adjusted net income available to common stockholders (non-GAAP)	$	1,081		$	1,616	$	1,949	$	2,318	$	2,296	$	6,964		$	12,041

Diluted weighted-average common shares outstanding (in millions) (GAAP)	383.7			384.6		392.6		412.2		424.3		393.2			444.2

Diluted EPS (GAAP)	$	3.03		$	4.20	$	4.96	$	5.62	$	5.41	$	17.91		$	26.94
Impact of adjustments noted above	(0.21)			—		—		—		—		(0.20)			0.17
Adjusted diluted EPS (non-GAAP)	$	2.82		$	4.20	$	4.96	$	5.62	$	5.41	$	17.71		$	27.11

Adjusted efficiency ratio:
Non-interest expense (GAAP)	$	5,080		$	4,949	$	4,583	$	4,551	$	4,678	$	19,163		$	16,570
Insurance recoveries and legal reserve activity	177			—		—		—		—		177			(100)
Restructuring Charges	(72)			—		—		—		—		(72)			—
Adjusted non-interest expense (non-GAAP)	$	5,185		$	4,949	$	4,583	$	4,551	$	4,678	$	19,268		$	16,470

Total net revenue (GAAP)	$	9,040		$	8,805	$	8,232	$	8,173	$	8,118	$	34,250		$	30,435




Efficiency ratio (GAAP)	56.19%			56.21%		55.67%		55.68%		57.63%		55.95%			54.44%
Impact of adjustments noted above	117		bps	—		—		—		—		31		bps	(32)		bps
Adjusted efficiency ratio (non-GAAP)	57.36%			56.21%		55.67%		55.68%		57.63%		56.26%			54.12%

Adjusted operating efficiency ratio:
Operating expense (GAAP)	$	3,962		$	3,971	$	3,580	$	3,633	$	3,679	$	15,146		$	13,699
Insurance recoveries and legal reserve activity	177			—		—		—		—		177			(100)
Restructuring Charges	(72)			—		—		—		—		(72)			—
Adjusted operating expense (non-GAAP)	$	4,067		$	3,971	$	3,580	$	3,633	$	3,679	$	15,251		$	13,599


	2022			2022		2022		2022		2021		Year Ended December 31,
(Dollars in millions, except per share data and as noted)	Q4			Q3		Q2		Q1		Q4		2022			2021
Total net revenue (GAAP)	$	9,040		$	8,805	$	8,232	$	8,173	$	8,118	$	34,250		$	30,435




Operating efficiency ratio (GAAP)	43.83%			45.10%		43.49%		44.45%		45.32%		44.22%			45.01%
Impact of adjustments noted above	116		bps	—		—		—		—		31		bps	(33)		bps
Adjusted operating efficiency ratio (non-GAAP)	44.99		%	45.10%		43.49%		44.45%		45.32%		44.53%			44.68%

Reconciliation of Non-GAAP Measures

The following non-GAAP measures consist of TCE, tangible assets and metrics computed using these amounts, which include tangible book value per common share, return on average tangible assets, return on average TCE and TCE ratio. We consider these metrics to be key financial performance measures that management uses in assessing capital adequacy and the level of returns generated. While our non-GAAP measures are widely used by investors, analysts and bank regulatory agencies to assess the capital position of financial services companies, they may not be comparable to similarly-titled measures reported by other companies. The following tables present reconciliations of these non-GAAP measures to the applicable amounts measured in accordance with GAAP.


	2022		2022		2022		2022		2021
(Dollars in millions)	Q4		Q3		Q2		Q1		Q4
Tangible Common Equity (Period-End)
Stockholders’ equity	$	52,582	$	50,861	$	53,410	$	56,345	$	61,029
Goodwill and intangible assets(9)	(14,902)		(14,932)		(14,850)		(14,883)		(14,907)
Noncumulative perpetual preferred stock	(4,845)		(4,845)		(4,845)		(4,845)		(4,845)
Tangible common equity	$	32,835	$	31,084	$	33,715	$	36,617	$	41,277
Tangible Common Equity (Average)
Stockholders’ equity	$	52,439	$	54,541	$	54,165	$	59,437	$	62,498
Goodwill and intangible assets(9)	(14,926)		(14,916)		(14,875)		(14,904)		(14,847)
Noncumulative perpetual preferred stock	(4,845)		(4,845)		(4,845)		(4,845)		(5,552)
Tangible common equity	$	32,668	$	34,780	$	34,445	$	39,688	$	42,099
Tangible Assets (Period-End)
Total assets	$	455,249	$	444,232	$	440,288	$	434,195	$	432,381
Goodwill and intangible assets(9)	(14,902)		(14,932)		(14,850)		(14,883)		(14,907)
Tangible assets	$	440,347	$	429,300	$	425,438	$	419,312	$	417,474
Tangible Assets (Average)
Total assets	$	449,659	$	447,088	$	435,327	$	430,372	$	427,845
Goodwill and intangible assets(9)	(14,926)		(14,916)		(14,875)		(14,904)		(14,847)
Tangible assets	$	434,733	$	432,172	$	420,452	$	415,468	$	412,998

__________

(1)Regulatory capital metrics and capital ratios as of December 31, 2022 are preliminary and therefore subject to change.

(2)Excludes certain components of AOCI as permitted under the Tailoring Rules.

(3)Total capital equals the sum of Tier 1 capital and Tier 2 capital.

(4)Adjusted average assets for the purpose of calculating our Tier 1 leverage ratio represents total average assets adjusted for amounts that are deducted from Tier 1 capital, predominately goodwill and intangible assets. Tier 1 leverage ratio is a regulatory capital measure calculated based on Tier 1 capital divided by adjusted average assets.

(5)Common equity Tier 1 capital ratio is a regulatory capital measure calculated based on common equity Tier 1 capital divided by risk-weighted assets.

(6)Tier 1 capital ratio is a regulatory capital measure calculated based on Tier 1 capital divided by risk-weighted assets.

(7)Total capital ratio is a regulatory capital measure calculated based on total capital divided by risk-weighted assets.

(8)TCE ratio is a non-GAAP measure calculated based on TCE divided by tangible assets.

(9)Includes impact of related deferred taxes.