Capital One Quarterly Profit Falls on Higher Loan Loss Provision
Capital One Financial Corp (NYSE:COF), one of the largest credit card issuers in the United States, reported a lower-than-expected quarterly profit as it set aside more money to cover soured loans.
The company's net income attributable to shareholders fell 2.9 percent to $1.06 billion, or $1.86 per share, for the third quarter ended Sept. 30, from $1.09 billion, or $1.84 per share, a year earlier.
Capital One raised its provision for credit losses by 17 percent to $993 million, from a year earlier.
Total net revenue was nearly flat at $5.64 billion.
Analysts on average expected earnings of $1.94 per share on revenue of $5.56 billion, according to Thomson Reuters I/B/E/S/.
Larger rival American Express Co reported a rise in quarterly profit on Wednesday, helped by U.S. customers spending more using its credit cards and a rise in net interest income.
Capital One's net interest income - the difference between what banks earn on loans and pay out on deposits - fell about 1 percent to $4.50 billion in the quarter.
The company's net charge-off rate - the percentage of loans written off as unrecoverable - was 1.52 percent, a decrease of 40 basis points from a year earlier.
McLean, Virginia-based Capital One shares closed at $78.53 on the New York Stock Exchange on Thursday.
(Reporting by Avik Das in Bangalore; Editing by Simon Jennings)