Capital One has published the results of its activities in the period from July to the end of September this year.
According to the results of the last quarter, the net profit of the financial institution was fixed at $1.8 billion. In the previous quarter, this figure was $1.4 billion. In the period from July to the end of September 2022, the bank received a net profit of $1.7 billion.
According to the results of the third quarter of this year, the level of delinquency in the American card business of Capital One demonstrated an extension of the growth trend. During the period from July to the end of September, this indicator returned to the value that was observed before the outbreak of the coronavirus pandemic.
The level of overdue payments for 30 days in the American card business of a financial institution during the last quarter was 4.3%. In the previous quarter, this figure was 3.7%. In the third quarter of 2022, the level of late payments was 3%.
Richard Fairbank, Chairman of the Management Board of Capital One, said that the normalization of results on domestic credit cards is currently being recorded compared to the record values that were recorded during the coronavirus pandemic. Separately, he noted that the monthly level of delinquency and the monthly level of write-offs slightly exceed the indicators observed in 2019.
The volume of purchases in the bank’s American card business for the last quarter was fixed at $155 billion. This indicator slightly exceeds the result for the previous quarter and is 6% higher than for the same period in 2022.
Capital One’s reserve to cover losses on the credit card portfolio in the third quarter amounted to $11.3 billion, which is equal to 7.7%. This indicator does not differ significantly from the result recorded in the period from April to the end of June, but by 6.9% exceeds the volume for the same period in 2022. At the end of 2020, the reserve was 10.5%.
The average volume of loans for investments in the last quarter increased by $ 3.1 billion year-on-year, reaching $ 312.8 billion. The total amount of deposits as of the end of September amounted to $ 346 billion, an increase of $ 2.3 billion compared to a year ago.
In the bank’s American card business, 69% of customers had a FICO score of at least 660 in the third quarter, which is a percentage point lower compared to 70% in the same period last year.
Richard Fairbank, in response to a question about the state of affairs of consumers, said that the level of delinquencies in all segments has returned to the pre-pandemic value and shows a trend of stabilization.
The financial institution also reported that the number of car loans issued in the third quarter decreased by 10% year-on-year. Also, the average volume of deposits increased by 12% compared to the same period in 2022. Loans at the end of the validity period of credit cards grew by 16% year-on-year in the third quarter.
Richard Fairbank said that the last quarter was a period of strong growth in revenue from internal cards, loans, and purchases. He also reported an increase in the volume of consumer and aggregate deposits. The pace of normalization of delinquencies on internal cards, according to him, has slowed down.
As we have reported earlier, Walmart Suit Seeks to End Capital One Card Relationship.