Businessweek

Capital One Financial Corporation operates as the bank holding company for the Capital One Bank (USA), National Association (COBNA); and Capital One, National Association (CONA), which provide various financial products and services to consumers, small businesses and commercial clients in the United States. COBNA offers credit and debit card products, other lending products and deposit products; and CONA provides banking products and financial services. As of December 31, 2012, the company serviced banking customer accounts through the Internet and branch locations primarily in New York, New Jersey, Texas, Louisiana, Maryland, Virginia and the District of Columbia. In addition to bank lending, treasury management and depository services, the company offers credit and debit card products, auto loans and mortgage banking in markets across the United States. The company also offers products outside of the United States principally through Capital One (Europe) plc (COEP), an indirect subsidiary of COBNA organized and located in the United Kingdom (U.K.), and through a branch of COBNA in Canada. COEP has authority to provide credit card and installment loans. Segments The company’s principal operations are organized into three primary segments: Credit Card, Consumer Banking and Commercial Banking. Credit Card: This segment consists of the company’s domestic consumer and small business card lending, national small business lending, national closed end installment lending and the international card lending businesses in Canada and the United Kingdom. Consumer Banking: This segment comprises the company’s branch-based lending and deposit gathering activities for consumers and small businesses, national deposit gathering, national auto lending, and consumer home loan lending and servicing activities. Commercial Banking: This segment consists of the company’s lending, deposit gathering and treasury management services to commercial real estate and commercial and industrial customers. Loan Products Credit cards: The company markets a range of credit card products across the credit spectrum and through various channels. Auto loans: The company markets a range of auto loan products across the credit spectrum. Customers are acquired through a network of auto dealers and direct marketing. The company’s auto loans generally have fixed interest rates and loan terms of 72 months or less. Home loans: The company originates residential mortgage and home equity loans in its retail branch footprint through its branches, home loan officers, and direct marketing. Its home loan products include conforming and non-conforming fixed rate and adjustable rate mortgage loans, as well as first and second lien home equity loans and lines of credit. Commercial loans: The company offers a range of commercial lending products, including loans secured by commercial real estate and loans to middle market industrial and service companies. Markets The company’s consumer loan portfolios, including credit cards, are diversified across the United States with concentration in California, Texas, New York, Florida, Louisiana, and Illinois. It also has credit card loans in the U.K. and Canada. The company’s commercial loans are concentrated in New York, Texas, Louisiana, and New Jersey. Investment Portfolio As of December 31, 2012, the company’s investment portfolio included U.S. treasury and U.S. agency debt obligations; agency and non-agency mortgage-backed securities; other asset-backed securities; fixed-income debt securities; and equity securities. Deposits The company’s deposit products include non-interest bearing deposits and interest-bearing deposits, including demand deposits, money market deposits, negotiable order of withdrawal (NOW) accounts, savings accounts, and certificates of deposit. Significant Events ING Direct: In February 2012, the company acquired all of the ING Direct business in the United States (ING Direct) from ING Groep N.V., ING Bank N.V., ING Direct N.V. and ING Direct Bancorp (collectively the ING Direct Sellers). HSBC—U.S. Credit Card Business: In May 2012, pursuant to the agreement with HSBC Finance Corporation, HSBC USA Inc. and HSBC Technology and Services (USA) Inc. (collectively HSBC), the company closed the acquisition of substantially all of the assets and assumed liabilities of HSBC’s credit card and private-label credit card business in the United States. Regulation The company is a bank holding company (BHC) under Section 3 of the Bank Holding Company Act of 1956, as amended (12 U.S.C. § 1842) (the BHC Act) and is subject to the requirements of the BHC Act, including its capital adequacy standards and limitations on its nonbanking activities. The company is also subject to supervision, examination and regulation by the Board of Governors of the Federal Reserve System (the Federal Reserve). COBNA and CONA are subject to comprehensive regulation and periodic examination by the Office of the Comptroller of the Currency, the Federal Deposit Insurance Corporation, and by the Consumer Financial Protection Bureau. The company is also registered as a financial institution holding company under Virginia law and, as such, the company is subject to periodic examination by Virginia’s Bureau of Financial Institutions. The activities of the COBNA and CONA as consumer lenders also are subject to regulation under various federal laws, including the Truth-in-Lending Act, the Equal Credit Opportunity Act, the Fair Credit Reporting Act (the FCRA), the CRA and the Servicemembers Civil Relief Act, as well as under various state laws. History Capital One Financial Corporation was founded in 1993.