Capital One Bank Evaluation

brink Per take shapeance Evaluation Project with child(p) angiotensin converting enzyme deposeing comp eaching come with detonator atomic number 53 pecuniary Corporations home is in McLean, Virginia and in the plyeral constraint district five, The Federal Reserve of Richmond, Virginia. It is identification number 89 in confederate concourse iodin with their unite as chastises of oer $ three hundred one thousand million. Peer group one relys argon institutions that have equal to or great than $10 million in consolidated summations. crown virtuoso lodge specializes in credit flyers, home imparts, auto loans, mend providing banking companying and savings products.They argon a portion 500 company and have pave the way for mass credit card food marketing in the 1990s. Since its inception in 1988, large(p) one and only(a) has acquired numerous small banks and has kept growing to become one of the most tumefy know bank holding companies in the United States . alas in November 2008, groovy whiz cashbox suffered devastating losses and received $3. 5 billion bail-out mo give the axeary resource from the Federal catch Economic Stabilization Act. But by mid 2009, Capital wholeness Bank had bought back over 3. 5 million of their preferred stock sh atomic number 18s from the United States Treasury.Although Capital One Bank has experienced whatsoever economic hardships in the recent previous(prenominal), it seems to be holding steady after the rouse of the 2008 financial system meltdown. If we take a close look at this banks performance report, we can develop some beting information near their biggest asset components. For Capital Ones assets their sh atomic number 18age for loans to individuals is relatively high, 36. 77 percentage compared to that of the colleague group just of 4. 98 percent. This is indicative of a company that produces a large number of loans to individuals in the form of real ground, auto, and credit ca rds.This also indicates that this bank is intimacyed in making gain from interest on loans. Real estate loans for this company are high with 22. 26 percent compared to the partner group clean of 32. 89 percent. Although this bank dabbles in moneymaking(prenominal) banking, it keeps its commercial and industrial loans to a stripped in comparison to its early(a) look one counterparts. There are a few areas where Capital one shows closely no interest such as agricultural loans, investments in mutual memory boards and lawfulness securities, and fed funds sell and reverse repos which are purchased under an savvy to resell.Federal funds interchange are apply for overnight funds that keep balances on alluviations at Federal Reserve Banks for purposes of alter daily checks and flummoxs(Olsen Research Associates). A causa Capital One Bank does not use this practice may be because it does not want to risk losing assets in the event that the adoption bank defaults. Because F ed Funds Contracts are not secured they are always subject to loss if the borrowing bank defaults (Olsen Research Associates). Capital One Bank has relatively amount percentages of debt securities of slight than or more than one grade.A debt credential can be bought or sold between two parties, has defined sum ups, rates, and maturities. As a whole, debt securities are relatively safer than virtue securities because they have a principal amount that is returned to the lender at a undertake maturity date. Moving on to the fluidity and funding of Capital One Bank, the kernel deposits are above those of other catch banks at 64. 84 percent compared to 55. 17 percent. marrow deposits are comprised of beg deposits, deposit accounts that are subject to negotiable orders of breakup or automatic transfer from the savings accounts.This section also includes time deposits of little than $100,000, money market deposit accounts, other savings accounts, and other non-interest bearing deposit balances. Banks count on core deposits to fund loans while offering advantages such as predictable costs and a cadence of the degree of customer loyalty (Core Deposits). Core deposits are less vulnerable to short-term changes in the interest rates than CDs or money market accounts (Core Deposits). The simoleons loans and leases percentages of Capital One Bank are high as well compared to their competing banks.This is due to the high number of loans this bank awards to individuals in the form of mortgages, car loans, face-to-face loans, and credit cards. Credit card loans electrical shock the competition out of the water with an highly high 40. 9 percent compared to peer group ones average of 2. 41 percent. The liquid assets of Capital One are slightly lower in comparison to their peers by about 10 percentage point this is another index that this bank produces numerous loans and has its assets tied up.Turning the attending to the relative income statement and marginal synopsis portion of the report will set forth the key components of earnings relative to average assets, margin digest ratios, the yields or returns of item assets, and the cost of funds. The report shows that Capital Ones main source of income is interest income including high interest income equaling a high net interest income. Adjusted operational income, which is net interest income plus non-interest income, for Capital One Bank is 7. 45 percent to the peer group average of 4. 74.This is nigh twice the amount of income from interest over its competitors. After accounting for in operation(p) expenses and realised gains and losses, the company has a pretax net income of 1. 82 percent and a net operating income of 1. 38 percent. The companys interest expenses are insignificantly higher than those of its peers. Capital One has made provisions for loan and lease losses which are monies set aside for default loans. These provisions are greater than the competitors by 1. 25 per cent and represent the banks entrust to survive if loans default.Looking at the margin analysis portion of this section, you can note that the net interest income to average earning assets is twice as high as its competitors in peer group one at 6. 49 percent. It is safe to say that Capital One Bank receives the majority of its income from interest. Capitalization is the semipermanent funding that allows a business incorruptible to operate. It is the investment that the business owner and any other investors make in the firm. It is a financial term which refers to the sum of the stockholders equity of the firm and the firms long-term debt, such as bonds or mortgages (Peavler).Capitalization is also a mensuration of business value based on the share price and number of shares outstanding. This is in general the markets representation of the companys value (Ycharts). For Capital One Bank, there capitalization is relatively corresponding to its counterparts. Equity capital to tota l asset ratio for Capital one is 13. 13 percent while the average for peer group one is 11. 30 and does not represent a substantial difference. Although Capital One Financial has seen its ups and downs over the past few years, it reports their third quarter net income jumped 47 percent versus the prior year quarter.This development in wage is credited to the acquisition of ING Direct a financial institution of Dutch declination offering banking, insurance, and asset management services, and HSBCs United States card business (Associated Press). winnings income increased $357 million from this time decision year and price per share went from $1. 77 to $2. 01, a 24 cent increase (Associated Press). Revenues also soared 39 percent to $5. 78 billion. Capital One Financial reports that it expects consumer demand to slow down soon, but they are prepared for what the future holds. -Top of Form dec 10, 2012 1217 p. m. ET COF (Common profligate) ExchangeNYSE (US Dollar) Last take $57. 77 substitute + 0. 70 % Change 1. 23% Volume 1,167,465 Intraday High $57. 80 Open $56. 91 Intraday Low $56. 78 Minimum 20 minute outride Bottom of Form (Capital One Stock Quote and Chart) Works Cited Associated Press. News unofficialCapital One Posts Higher 3Q Profit. Bloomberg Businessweek News. 18 2012 n. page. Web. 10 Dec. 2012. . Capital One Financial Corporation Market Cap. Ycharts. N. p. , 06 2012. Web. 6 Dec 2012. . Core Deposits. Investopedia US. United States 2012.