UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

Washington, D.C. 20549

____________________________________

FORM 10-Q

___________________________________

☒ QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934

For the quarterly period ended September 30, 2025

OR

☐ TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934

For the transition period from              to             

Commission File No. 001-13300

____________________________________

CAPITAL ONE FINANCIAL CORPORATION

(Exact name of registrant as specified in its charter) 

____________________________________

Delaware		54-1719854
(State or other jurisdiction of incorporation or organization)		(I.R.S. 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, former address and former fiscal year, if changed since last report)
____________________________________

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
1.650% Senior Notes Due 2029	COF29	New York Stock Exchange

Indicate by check mark whether the registrant (1) has filed all reports required to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during the preceding 12 months (or for such shorter period that the registrant was required to file such reports), and (2) has been subject to such filing requirements for the past 90 days. Yes ☒  No ☐

Indicate by check mark whether the registrant has submitted electronically every Interactive Data File required to be submitted pursuant to Rule 405 of Regulation S-T (§232.405 of this chapter) during the preceding 12 months (or for such shorter period that the registrant was required to submit such files). Yes ☒ No ☐

Indicate by check mark whether the registrant is a large accelerated filer, an accelerated filer, a non-accelerated filer, a smaller reporting company, or an emerging growth company. See the definitions of “large accelerated filer,” “accelerated filer,” “smaller reporting company,” and “emerging growth company” in Rule 12b-2 of the Exchange Act.

Large accelerated filer	☒	Accelerated filer	☐
Non-accelerated filer	☐	Smaller reporting company	☐
		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. ☐

Indicate by check mark whether the registrant is a shell company (as defined in Rule 12b-2 of the Exchange Act). Yes ☐ No ☒

As of September 30, 2025, there were 635,733,605 shares of the registrant’s Common Stock outstanding.

TABLE OF CONTENTS

		Page
PART I - FINANCIAL INFORMATION		4
Item 1.	Financial Statements	77
	Consolidated Statements of Income	78
	Consolidated Statements of Comprehensive Income	79
	Consolidated Balance Sheets	80
	Consolidated Statements of Changes in Stockholders’ Equity	81
	Consolidated Statements of Cash Flows	83
	Notes to Consolidated Financial Statements	85
	Note 1—Summary of Significant Accounting Policies	85
	Note 2—Business Combinations and Discontinued Operations	87
	Note 3—Investment Securities	93
	Note 4—Loans	96
	Note 5—Allowance for Credit Losses and Reserve for Unfunded Lending Commitments	112
	Note 6—Variable Interest Entities and Securitizations	117
	Note 7—Goodwill and Other Intangible Assets	121
	Note 8—Deposits and Borrowings	123
	Note 9—Derivative Instruments and Hedging Activities	124
	Note 10—Stockholders’ Equity	134
	Note 11—Earnings Per Common Share	138
	Note 12—Fair Value Measurement	139
	Note 13—Business Segments and Revenue from Contracts with Customers	146
	Note 14—Commitments, Contingencies, Guarantees and Others	150

1 Capital One Financial Corporation (COF)

Item 2.	Management’s Discussion and Analysis of Financial Condition and Results of Operations (“MD&A”)	4
	Introduction	4
	Selected Financial Data	7
	Executive Summary	10
	Consolidated Results of Operations	11
	Consolidated Balance Sheets Analysis	17
	Off-Balance Sheet Arrangements	20
	Business Segment Financial Performance	21
	Critical Accounting Policies and Estimates	31
	Accounting Changes and Developments	33
	Capital Management	34
	Risk Management	40
	Credit Risk Profile	42
	Liquidity Risk Profile	56
	Market Risk Profile	61
	Supervision and Regulation	65
	Forward-Looking Statements	66
	Supplemental Table	68
	Glossary and Acronyms	70
Item 3.	Quantitative and Qualitative Disclosures about Market Risk	155
Item 4.	Controls and Procedures	156
PART II—OTHER INFORMATION		157
Item 1.	Legal Proceedings	157
Item 1A.	Risk Factors	157
Item 2.	Unregistered Sales of Equity Securities and Use of Proceeds	157
Item 3.	Defaults Upon Senior Securities	157
Item 4.	Mine Safety Disclosures	157
Item 5.	Other Information	157
Item 6.	Exhibits	158
EXHIBIT INDEX		159
SIGNATURES		160

2 Capital One Financial Corporation (COF)

INDEX OF MD&A AND SUPPLEMENTAL TABLE

MD&A Tables:		Page
1	Consolidated Financial Highlights	7
2	Average Balances, Net Interest Income and Net Interest Margin	12
3	Rate/Volume Analysis of Net Interest Income	14
4	Non-Interest Income	15
5	Non-Interest Expense	16
6	Loans Held for Investment	18
7	Funding Sources Composition	18
8	Business Segment Results	22
9	Credit Card Business Results	23
9.1	Domestic Card Business Results	25
10	Consumer Banking Business Results	26
11	Commercial Banking Business Results	28
12	Other Category Results	30
13	Capital Ratios Under Basel III	36
14	Regulatory Risk-Based Capital Components and Regulatory Capital Metrics	37
15	Preferred Stock Dividends Paid Per Share	38
16	Credit Card Portfolio by Geographic Region	43
17	Auto Loan Portfolio by Geographic Region	44
18	Commercial Real Estate Portfolio by Region	45
19	Commercial Loans by Industry	46
20	Credit Score Distribution	47
21	30+ Day Delinquencies	49
22	Aging and Geography of 30+ Day Delinquent Loans	50
23	90+ Day Delinquent Loans Accruing Interest	50
24	Nonperforming Loans and Other Nonperforming Assets	51
25	Net Charge-Offs	52
26	Allowance for Credit Losses and Reserve for Unfunded Lending Commitments Activity	53
27	Liquidity Reserves	56
28	Deposits Composition and Average Deposits Interest Rates	58
29	Long-Term Debt Funding Activities	59
30	Senior Unsecured Long-Term Debt Credit Ratings	60
31	Interest Rate Sensitivity Analysis	63
Supplemental Table:
A	Reconciliation of Non-GAAP Measures	68

3 Capital One Financial Corporation (COF)

PART I—FINANCIAL INFORMATION

Item 2. Management’s Discussion and Analysis of Financial Condition and Results of Operations (“MD&A”)

This discussion contains forward-looking statements that are based upon management’s current expectations and are subject to significant uncertainties and changes in circumstances. Please review “Forward-Looking Statements” for more information on the forward-looking statements in this Quarterly Report on Form 10-Q (“this Report”). All statements that address operating performance, events or developments that we expect or anticipate will occur in the future are forward-looking statements. Our actual results may differ materially from those included in these forward-looking statements due to a variety of factors including, but not limited to, those described in “Part II—Item 1A. Risk Factors” in our Quarterly Report on Form 10-Q for the period ended June 30, 2025 (the“Q2 2025 Form 10-Q”) and in this Report. Unless otherwise specified, references to notes to our consolidated financial statements refer to the notes to our consolidated financial statements as of September 30, 2025 included in this Report.

Management monitors a variety of key indicators to evaluate our business results and financial condition. The following MD&A is provided as a supplement to, and should be read in conjunction with, our consolidated financial statements and related notes in this Report and the more detailed information contained in our 2024 Annual Report on Form 10-K (“2024 Form 10-K”).

INTRODUCTION

Capital One Financial Corporation, a Delaware corporation established in 1994 and headquartered in McLean, Virginia, is a diversified financial services holding company with banking and non-banking subsidiaries. Capital One Financial Corporation and its subsidiaries (the “Company” or “Capital One”) offer a broad array of financial products and services to consumers, small businesses and commercial clients through digital channels, branch locations, cafés and other distribution channels.

Capital One Financial Corporation’s principal operating subsidiary was Capital One, National Association (“CONA”). On May 18, 2025 (the “Closing Date”), Discover Financial Services (“Discover”) merged into Capital One and Discover Bank merged into CONA. See “Part I—Item 1. Financial Statements—Note 2—Business Combinations and Discontinued Operations” for additional information. The Company is hereafter collectively referred to as “we,” “us” or “our.” CONA is referred to as the “Bank.”

We are one of the largest issuers of credit cards in the United States of America (“U.S.”) based on the outstanding balance of credit card loans as of September 30, 2025. In addition to credit cards, we also offer debit cards, bank lending, treasury management and depository services, auto loans, and other consumer lending products in markets across the U.S. As one of the nation’s largest banks based on deposits as of September 30, 2025, we service banking customer accounts through digital channels and our network of branch locations, cafés, call centers and automated teller machines (“ATMs”). Additionally, through the acquisition of Discover, we acquired new products including personal loans as well as the Discover Network, the PULSE Network, Diners Club International (“Diners Club”) and Network Partners (collectively, the “Global Payment Network”). The Discover Network processes transactions for credit and debit cards issued on its network and provides payment transaction processing and settlement services. The PULSE Network operates an electronic funds transfer network, providing financial institutions issuing debit cards on the PULSE Network with access to ATMs domestically and internationally, as well as merchant acceptance throughout the U.S. for debit card transactions. Diners Club is a global payments network of licensees, which are generally financial institutions, that issue Diners Club-branded charge cards and/or provide card acceptance services. We also have agreements with a number of financial institutions, financial technology firms, networks, network-to-network partners and other commercial service providers (collectively, “Network Partners”) for the provision of card issuing, payments processing and related services on the Global Payment Network. In our newly acquired network business, we compete with other networks for transaction volume and to attract Network Partners to issue credit, debit and prepaid cards on the Global Payment Network.

We also offer credit card products and certain other services outside of the U.S. through Capital One (Europe) plc (“COEP”), an indirect subsidiary of CONA organized and located in the United Kingdom (“U.K.”), and through a branch of CONA in Canada. Both COEP and our Canadian branch of CONA have the authority to provide credit card loans. In addition, we offer Global Payment Network services globally.

4 Capital One Financial Corporation (COF)

Our consolidated total net revenues are derived primarily from lending to consumer and commercial customers net of funding costs associated with our deposits, long-term debt and other borrowings. We also earn non-interest income which primarily consists of discount and interchange income, net of reward expenses, service charges and other customer-related fees. Our expenses primarily consist of the provision for credit losses, operating expenses, marketing expenses and income taxes.

Our principal operations are organized for management reporting purposes into three major business segments, which are defined primarily based on the products and services provided or the types of customers served: Credit Card, Consumer Banking and Commercial Banking. The operations of acquired businesses have been integrated into or managed as a part of our existing business segments. Certain activities that are not part of a business segment are included in the Other category, such as the management of our corporate investment portfolio and asset/liability positions performed by our centralized Corporate Treasury group and any residual tax expense or benefit beyond what is assessed to our business segments in order to arrive at the consolidated effective tax rate. The Other category also includes unallocated corporate expenses that do not directly support the operations of the business segments or for which the business segments are not considered financially accountable in evaluating their performance, such as certain restructuring charges and integration expenses related to the acquisition of Discover.

•Credit Card: Consists of our domestic consumer card lending, personal loans, domestic small business card lending and international card businesses in the U.K. and Canada.

•Consumer Banking: Consists of our deposit gathering and lending activities for consumers and small businesses, national auto lending and services offered by the Global Payment Network.

•Commercial Banking: Consists of our lending, deposit gathering, capital markets and treasury management services to commercial real estate and commercial and industrial customers. Our customers typically include companies with annual revenues between $20 million and $2 billion.

Business Developments

We regularly explore and evaluate opportunities to acquire financial products and services as well as financial assets, including credit card and other loan portfolios, and enter into strategic partnerships as part of our growth strategy. We also explore opportunities to acquire technology companies and related assets to improve our information technology infrastructure and to deliver on our digital strategy. We may issue equity or debt to fund our acquisitions. In addition, we regularly consider the potential disposition of certain of our assets, branches, partnership agreements or lines of business.

Discover Acquisition

On February 19, 2024, the Company entered into an agreement and plan of merger (the “Merger Agreement”), by and among Capital One, Discover, a Delaware corporation and Vega Merger Sub, Inc., a Delaware corporation and a direct, wholly owned subsidiary of the Company (“Merger Sub”). On May 18, 2025, the Company closed the acquisition of Discover, pursuant to which (i) Merger Sub merged with and into Discover, with Discover as the surviving entity in the merger (the “Merger”); (ii) immediately following the Merger, Discover, as the surviving entity, merged with and into Capital One, with Capital One as the surviving entity in the second-step merger (the “Second Step Merger”); and (iii) immediately following the Second Step Merger, Discover Bank, a Delaware-chartered and wholly owned subsidiary of Discover, merged with and into CONA, with CONA as the surviving entity in the merger (the “CONA Bank Merger,” and collectively with the Merger and Second Step Merger, the “Transaction”). The Transaction enables the Company to leverage its newly acquired networks, customer base, technology, and data ecosystem to drive value for merchants, consumers, and small businesses. The Company has begun to convert legacy Capital One customer debit cards on to the Global Payment Network.

Upon closing, each share of common stock of Discover outstanding immediately prior to the effective time of the Merger, other than certain shares held by Discover or Capital One, was converted into the right to receive 1.0192 shares of common stock of Capital One. Holders of Discover common stock received cash in lieu of fractional shares. At the effective time of the Second Step Merger, each share of Fixed-to-Floating Rate Non-Cumulative Perpetual Preferred Stock, Series C, of Discover, and each share of 6.125% Fixed-Rate Reset Non-Cumulative Perpetual Preferred Stock, Series D, of Discover, in each case outstanding immediately prior to the effective time of the Second Step Merger, was converted into the right to receive a share of newly created Fixed-to-Floating Rate Non-Cumulative Perpetual Preferred Stock, Series O or 6.125% Fixed-Rate Reset Non-Cumulative Perpetual Preferred Stock, Series P of Capital One.

5 Capital One Financial Corporation (COF)

As of the Closing Date, the fair value of purchase consideration transferred was $51.8 billion. The fair value of total identifiable assets acquired was $168.1 billion, which included $108.2 billion of loans held for investment. The fair value of deposits assumed was $106.9 billion. Our results of operations for the third quarter of 2025 reflect the combined company. Our results of operations for the first nine months of 2025 reflect the activity of Discover’s acquired business operations for the period since the Closing Date. See “Part I—Item 1.Financial Statements—Note 2—Business Combinations and Discontinued Operations” for additional information.

In the second quarter of 2025, the Board of Directors approved a plan to exit the Discover Home Loan business acquired as a part of the Transaction. We are actively marketing the business and are in the process of identifying potential buyers. See “Part I—Item 1. Financial Statements—Note 2—Business Combinations and Discontinued Operations” for additional information.

6 Capital One Financial Corporation (COF)

SELECTED FINANCIAL DATA

The following table presents selected consolidated financial data and performance from our results of operations for the third quarter and first nine months of 2025 and 2024 and selected comparative balance sheet data as of September 30, 2025 and December 31, 2024. We also provide selected key metrics we use in evaluating our performance, including certain metrics that are computed using non-GAAP measures. We consider these metrics to be key financial measures that management uses in assessing our operating performance, capital adequacy and the level of returns generated. We believe these non-GAAP metrics provide useful insight 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 United States of America (“U.S. GAAP”), nor are they necessarily comparable to non-GAAP measures that may be presented by other companies.

Table 1: Consolidated Financial Highlights

	Three Months Ended September 30,					Nine Months Ended September 30,
(Dollars in millions, except per share data and as noted)	2025		2024		Change	2025		2024		Change
Income statement
Net interest income	$	12,404	$	8,076	54%	$	30,412	$	23,110	32%
Non-interest income	2,955		1,938		52	7,439		5,812		28
Total net revenue	15,359		10,014		53	37,851		28,922		31
Provision for credit losses	2,714		2,482		9	16,513		9,074		82
Non-interest expense:
Marketing	1,403		1,113		26	3,950		3,187		24
Operating expense	6,860		4,201		63	17,206		12,210		41
Total non-interest expense	8,263		5,314		55	21,156		15,397		37
Income from continuing operations before income taxes	4,382		2,218		98	182		4,451		(96)
Income tax provision (benefit)	1,189		441		170	(152)		797		**
Income from continuing operations, net of tax	3,193		1,777		80	334		3,654		(91)
Loss from discontinued operations, net of tax	(1)		—		**	(15)		—		**
Net income	3,192		1,777		80	319		3,654		(91)
Dividends and undistributed earnings allocated to participating securities	(33)		(28)		18	(13)		(60)		(78)
Preferred stock dividends	(73)		(57)		28	(195)		(171)		14
Discount on redeemed preferred stock	—		—		—	6		—		**
Net income available to common stockholders	$	3,086	$	1,692	82	$	117	$	3,423	(97)
Common share statistics
Basic earnings per common share:
Net income from continuing operations	$	4.83	$	4.42	9%	$	0.26	$	8.94	(97)%
Net loss from discontinued operations	—		—		—	(0.03)		—		**
Net income per basic common share	$	4.83	$	4.42	9	$	0.23	$	8.94	(97)
Diluted earnings per common share:
Net income from continuing operations	$	4.83	$	4.41	10%	$	0.26	$	8.92	(97)%
Net loss from discontinued operations	—		—		—	(0.03)		—		**
Net income per diluted common share	$	4.83	$	4.41	10	$	0.23	$	8.92	(97)
Weighted-average common shares outstanding (in millions):
Basic	639.0		383.0		67%	510.2		382.8		33%
Diluted	639.5		383.7		67	510.9		383.7		33

7 Capital One Financial Corporation (COF)

	Three Months Ended September 30,								Nine Months Ended September 30,
(Dollars in millions, except per share data and as noted)	2025			2024			Change		2025			2024			Change
Common shares outstanding (period-end, in millions)	635.7			381.5			67%		635.7			381.5			67%
Dividends declared and paid per common share	$	0.60		$	0.60		—		$	1.80		$	1.80		—
Tangible book value per common share (period-end)(1)	105.18			112.36			(6)		105.18			112.36			(6)
Balance sheet (average balances)
Loans held for investment	$	439,859		$	318,255		38%		$	380,564		$	315,927		20%
Interest-earning assets	593,247			454,484			31		527,461			451,078			17
Total assets	657,858			481,219			37		574,602			477,816			20
Interest-bearing deposits	439,527			324,509			35		388,541			321,856			21
Total deposits	467,280			351,125			33		415,686			348,765			19
Borrowings	50,180			48,274			4		47,097			49,194			(4)
Common equity	107,412			56,443			90		82,306			54,293			52
Total stockholders’ equity	112,819			61,289			84		87,511			59,139			48
Selected performance metrics
Purchase volume	$	230,379		$	166,203		39%		$	589,780		$	481,517		22%
Global Payment Network volume(2)	153,117			N/A			**		227,131			N/A			**
Total net revenue margin(3)	10.36%			8.81%			155	bps	9.57%			8.55%			102	bps
Net interest margin	8.36			7.11			125		7.69			6.83			86
Return on average assets(4)	1.94			1.48			46		0.08			1.02			(94)
Return on average tangible assets(5)	2.07			1.53			54		0.08			1.05			(97)
Return on average common equity(6)	11.50			11.99			(49)		0.21			8.41			(820)
Return on average tangible common equity(7)	18.82			16.42			240		0.33			11.69			(1,136)
Equity-to-assets ratio(8)	17.15			12.74			441		15.23			12.38			285
Efficiency ratio(9)	53.80			53.07			73		55.89			53.24			265
Operating efficiency ratio(10)	44.66			41.95			271		45.46			42.22			324
Adjusted operating efficiency ratio(11)	38.89			41.41			(252)		40.63			41.71			(108)
Effective income tax rate from continuing operations	27.1			19.9			720		(83.5)			17.9			**
Net charge-offs	$	3,473		$	2,604		33%		$	9,269		$	7,864		18%
Net charge-off rate	3.16		%	3.27		%	(11)bps		3.25		%	3.32		%	(7)bps

    

(Dollars in millions, except as noted)	September 30, 2025		December 31, 2024		Change
Balance sheet (period-end)
Loans held for investment	$	443,159	$	327,775	35%
Interest-earning assets	605,235		463,058		31
Total assets	661,877		490,144		35
Interest-bearing deposits	441,136		336,585		31
Total deposits	468,785		362,707		29
Borrowings	51,482		45,551		13
Common equity	108,406		55,938		94
Total stockholders’ equity	113,813		60,784		87

8 Capital One Financial Corporation (COF)

(Dollars in millions, except as noted)	September 30, 2025			December 31, 2024			Change
Credit quality metrics
Allowance for credit losses	$	23,103		$	16,258		42%
Allowance coverage ratio	5.21		%	4.96		%	25bps
30+ day performing delinquency rate	3.29			3.69			(40)
30+ day delinquency rate	3.50			3.98			(48)
Capital ratios
Common equity Tier 1 capital(12)	14.4		%	13.5		%	90bps
Tier 1 capital(12)	15.5			14.8			70
Total capital(12)	17.3			16.4			90
Tier 1 leverage(12)	12.6			11.6			100
Tangible common equity (“TCE”)(13)	10.8			8.6			220
Supplementary leverage(12)	10.8			9.9			90
Other
Employees (period end, in thousands)	77.0			52.6			46%

__________

(1)Tangible book value per common share is a non-GAAP measure calculated based on TCE divided by common shares outstanding. See “Supplemental Table—Table A—Reconciliation of Non-GAAP Measures” for additional information on non-GAAP measures.

(2)Global Payment Network volume includes transactions processed on the Discover Network, PULSE Network, Diners Club and Network Partners.

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

(4)Return on average assets is calculated based on annualized income from continuing operations, net of tax, for the period divided by average total assets for the period.

(5)Return on average tangible assets is a non-GAAP measure calculated based on annualized income from continuing operations, net of tax, for the period divided by average tangible assets for the period. See “Supplemental Table—Table A—Reconciliation of Non-GAAP Measures” for additional information on non-GAAP measures.

(6)Return on average common equity is calculated based on annualized net income (loss) available to common stockholders less annualized 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.

(7)Return on average TCE is a non-GAAP measure calculated based on annualized net income (loss) available to common stockholders less annualized income (loss) from discontinued operations, net of tax, for the period, divided by average TCE. Our calculation of return on average TCE may not be comparable to similarly-titled measures reported by other companies. See “Supplemental Table—Table A—Reconciliation of Non-GAAP Measures” for additional information on non-GAAP measures.

(8)Equity-to-assets ratio is calculated based on average stockholders’ equity for the period divided by average total assets for the period.

(9)Efficiency ratio is calculated based on total non-interest expense for the period divided by total net revenue for the period.

(10)Operating efficiency ratio is calculated based on operating expense for the period divided by total net revenue for the period.

(11)Adjusted operating efficiency ratio is a non-GAAP measure. See “Supplemental Table—Table A—Reconciliation of Non-GAAP Measures” for a reconciliation of our adjusted operating efficiency ratio (non-GAAP) to our operating efficiency ratio (GAAP).

(12)Capital ratios are calculated based on the Basel III standardized approach framework. See “Capital Management” for additional information.

(13)TCE ratio is a non-GAAP measure calculated based on TCE divided by tangible assets. See “Supplemental Table—Table A—Reconciliation of Non-GAAP Measures” for the calculation of this measure and reconciliation to the comparative U.S. GAAP measure.

**    Not meaningful.

9 Capital One Financial Corporation (COF)

EXECUTIVE SUMMARY

Financial Highlights

We reported net income of $3.2 billion ($4.83 per diluted common share) on total net revenue of $15.4 billion and net income of $319 million ($0.23 per diluted common share) on total net revenue of $37.9 billion for the third quarter and first nine months of 2025, respectively. In comparison, we reported net income of $1.8 billion ($4.41 per diluted common share) on total net revenue of $10.0 billion and net income of $3.7 billion ($8.92 per diluted common share) on total net revenue of $28.9 billion for the third quarter and first nine months of 2024, respectively.

Our common equity Tier 1 (“CET1”) capital ratio as calculated under the Basel III standardized approach was 14.4% and 13.5% as of September 30, 2025 and December 31, 2024, respectively. See “Capital Management” for additional information.

In the third quarter of 2025, we declared and paid common stock dividends of $387 million and repurchased 1.0 billion of shares of our common stock. During the first nine months of 2025, we declared and paid common stock dividends of $1.0 billion and repurchased 1.3 billion of shares of our common stock. On October 20, 2025, our Board of Directors authorized the repurchase of up to $16 billion of shares of our common stock. Repurchases under the new share repurchase program were authorized to begin on October 21, 2025. This new authorization replaces the Company’s prior authorization to repurchase its common stock approved by our Board of Directors in April 2022. See “Capital Management—Dividend Policy and Stock Purchases” for additional information.

Below are additional highlights of our performance in the third quarter and first nine months of 2025. These highlights are based on a comparison between the results of the third quarter and first nine months of 2025 and 2024, except as otherwise noted. The changes in our financial condition and credit performance as of September 30, 2025 compared to December 31, 2024 were primarily driven by the Transaction. We provide a more detailed discussion of our financial performance in the sections following this “Executive Summary.”

Total Company Performance

•Earnings:

Our net income increased by $1.4 billion to $3.2 billion in the third quarter of 2025 compared to the third quarter of 2024 primarily driven by:

◦Higher net interest income primarily driven by higher loan balances, including the impacts of the Transaction.

◦Higher non-interest income primarily driven by growth in our credit card portfolio and the impacts of acquiring the Global Payment Network, both as a result of the Transaction.

These drivers were partially offset by:

◦Higher non-interest expense primarily driven by impacts from the Transaction, including integration expenses, as well as continued investments in technology.

Our net income decreased by $3.3 billion to $319 million in the first nine months of 2025 compared to the first nine months of 2024 primarily driven by:

◦Higher provision for credit losses primarily driven by the initial allowance for credit losses for non-purchased credit deteriorated (“non-PCD”) loans acquired in the Transaction.

◦Higher non-interest expense primarily driven by impacts from the Transaction, including integration expenses, as well as continued investments in technology.

These drivers were partially offset by:

◦Higher net interest income primarily driven by higher loan balances, including the impacts of the Transaction.

◦Higher non-interest income primarily driven by growth in our credit card portfolio and the impacts of acquiring the Global Payment Network, both as a result of the Transaction.

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•Loans Held for Investment:

◦Loans held for investment increased by $115.4 billion to $443.2 billion as of September 30, 2025 compared to December 31, 2024 primarily driven by the Transaction, which contributed $108.2 billion of loans held for investment as of the Closing Date.

◦Average loans held for investment increased by $121.6 billion to $439.9 billion in the third quarter of 2025 compared to the third quarter of 2024 and increased by $64.6 billion to $380.6 billion in the first nine months of 2025 compared to the first nine months of 2024 primarily driven by the Transaction.

•Net Charge-Off and Delinquency Metrics:

◦Our net charge-off rate decreased by 11 basis points (“bps”) to 3.16% in the third quarter of 2025 compared to the third quarter of 2024 and decreased by 7 bps to 3.25% in the first nine months of 2025 compared to the first nine months of 2024.

◦Our 30+ day delinquency rate decreased by 48 bps to 3.50% as of September 30, 2025 from December 31, 2024 primarily due to the loan portfolio acquired as part of the Transaction.

•Allowance for Credit Losses: Our allowance for credit losses increased by $6.8 billion to $23.1 billion as of September 30, 2025 compared to December 31, 2024 primarily driven by the initial allowance for credit losses acquired in the Transaction. Our allowance coverage ratio increased by 25 bps to 5.21% as of September 30, 2025 compared to December 31, 2024 primarily driven by a higher concentration of credit card loans, which carry comparatively higher coverage than our auto and commercial loan portfolios.

CONSOLIDATED RESULTS OF OPERATIONS

The section below provides a comparative discussion of our consolidated financial performance for the third quarter and first nine months of 2025 and 2024. We provide a discussion of our business segment results in the following section, “Business Segment Financial Performance.” This section should be read together with our “Executive Summary,” where we discuss trends and other factors that we expect will affect our future results of operations.

Net Interest Income

Net interest income represents the difference between interest income, including certain fees, earned on our interest-earning assets and the interest expense incurred on our interest-bearing liabilities. Our interest-earning assets include loans, investment securities and other interest-earning assets, while our interest-bearing liabilities include interest-bearing deposits, securitized debt obligations, senior and subordinated notes, other borrowings and other interest-bearing liabilities. Generally, we include in interest income any past due fees, net of reversals, on loans that we deem collectible. Our net interest margin represents the difference between the yield on our interest-earning assets and the cost of our interest-bearing liabilities, including the notional impact of non-interest-bearing funding and excluding discontinued operations. We expect net interest income and our net interest margin to fluctuate based on changes in interest rates and changes in the amount and composition of our interest-earning assets and interest-bearing liabilities. Loans, other assets, and liabilities associated with discontinued operations, and their related income and expense, are excluded from the net interest margin calculation.

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Table 2 below presents the average outstanding balance, interest income earned, interest expense incurred and average yield for the third quarter and first nine months of 2025 and 2024 for each major category of our interest-earning assets and interest-bearing liabilities. Nonperforming loans are included in the average loan balances below.

Table 2: Average Balances, Net Interest Income and Net Interest Margin

	Three Months Ended September 30,
	2025						2024
(Dollars in millions)	Average Balance		Interest Income/ Expense		Average Yield/ Rate(1)		Average Balance		Interest Income/ Expense		Average Yield/ Rate(1)
Assets:
Interest-earning assets:
Loans:(2)
Credit card	$	269,175	$	12,109	17.99	%	$	154,160	$	7,578	19.66	%
Consumer banking	82,295		1,958		9.52		76,182		1,692		8.88
Commercial banking(3)	88,904		1,426		6.42		88,373		1,601		7.24
Other(4)	—		(264)		**		—		(324)		**
Total loans, including loans held for sale	440,374		15,229		13.83		318,715		10,547		13.24
Investment securities	96,186		823		3.42		90,644		733		3.24
Cash equivalents and other interest-earning assets	56,687		711		5.02		45,125		580		5.14
Total interest-earning assets	593,247		16,763		11.30		454,484		11,860		10.44
Cash and due from banks	5,062						3,815
Allowance for credit losses	(23,857)						(16,654)
Premises and equipment, net	5,200						4,414
Other assets	70,035						35,160
Assets of discontinued operations	8,171						—
Total assets	$	657,858					$	481,219
Liabilities and stockholders’ equity:
Interest-bearing liabilities:
Interest-bearing deposits	$	439,527	$	3,597	3.27	%	$	324,509	$	2,945	3.63	%
Securitized debt obligations	12,919		165		5.11		15,833		234		5.93
Senior and subordinated notes	36,272		582		6.41		32,041		596		7.43
Other borrowings and interest-bearing liabilities(5)	3,120		15		2.04		2,389		9		1.50
Total interest-bearing liabilities	491,838		4,359		3.55		374,772		3,784		4.04
Non-interest-bearing deposits	27,753						26,616
Other liabilities	25,414						18,542
Liabilities of discontinued operations	34						—
Total liabilities	545,039						419,930
Stockholders’ equity	112,819						61,289
Total liabilities and stockholders’ equity	$	657,858					$	481,219
Net interest income/spread			$	12,404	7.75				$	8,076	6.40
Impact of non-interest-bearing funding					0.61						0.71
Net interest margin					8.36%						7.11%

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	Nine Months Ended September 30,
	2025						2024
(Dollars in millions)	Average Balance		Interest Income/ Expense		Average Yield/ Rate(1)		Average Balance		Interest Income/ Expense		Average Yield/ Rate(1)
Assets:
Interest-earning assets:
Loans:(2)
Credit card	$	212,172	$	28,764	18.08	%	$	151,700	$	21,733	19.10%
Consumer banking	80,304		5,592		9.28		75,555		4,867		8.59
Commercial banking(3)	88,516		4,229		6.37		89,452		4,829		7.20
Other(4)	—		(750)		**		—		(969)		**
Total loans, including loans held for sale	380,992		37,835		13.24		316,707		30,460		12.82
Investment securities	93,970		2,377		3.37		89,580		2,120		3.16
Cash equivalents and other interest-earning assets	52,499		1,797		4.56		44,791		1,737		5.17
Total interest-earning assets	527,461		42,009		10.62		451,078		34,317		10.14
Cash and due from banks	4,612						3,775
Allowance for credit losses	(20,024)						(15,783)
Premises and equipment, net	4,946						4,396
Other assets	53,545						34,350
Assets of discontinued operations	4,062						—
Total assets	$	574,602					$	477,816
Liabilities and stockholders’ equity:
Interest-bearing liabilities:
Interest-bearing deposits	$	388,541	$	9,432	3.24%		$	321,856	$	8,631	3.58%
Securitized debt obligations	13,228		505		5.10		17,036		753		5.90
Senior and subordinated notes	33,180		1,622		6.52		31,744		1,793		7.53
Other borrowings and interest-bearing liabilities(5)	2,771		38		1.84		2,422		30		1.67
Total interest-bearing liabilities	437,720		11,597		3.53		373,058		11,207		4.01
Non-interest-bearing deposits	27,145						26,909
Other liabilities	22,213						18,710
Liabilities of discontinued operations	13						—
Total liabilities	487,091						418,677
Stockholders’ equity	87,511						59,139
Total liabilities and stockholders’ equity	$	574,602					$	477,816
Net interest income/spread			$	30,412	7.09				$	23,110	6.14
Impact of non-interest-bearing funding					0.60						0.69
Net interest margin					7.69	%					6.83%

__________

(1)Average yield is calculated based on annualized interest income for the period divided by average loans during the period. Average yield is calculated using whole dollar values for average balances and interest income/expense.

(2)Past due fees, net of reversals, included in interest income totaled approximately $745 million and $1.9 billion in the third quarter and first nine months of 2025, respectively, and $626 million and $1.7 billion in the third quarter and first nine months of 2024, respectively.

(3)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. Taxable-equivalent adjustments included in the interest income and yield computations for our commercial loans totaled approximately $19 million and $59 million in the third quarter and first nine months of 2025, respectively, and $20 million and $59 million in the third quarter and first nine months of 2024, respectively, with corresponding reductions to the Other category.

(4)Interest income/expense in the Other category represents the impact of hedge accounting on our loan portfolios and the offsetting reduction of the taxable-equivalent adjustments of our commercial loans as described above.

(5)Includes amounts related to entities that provide capital to low-income and rural communities of $2.1 billion in both the third quarter and first nine months of 2025, and $2.0 billion in both the third quarter and first nine months of 2024. Related interest expense was $8 million and $23 million for the third quarter and first nine months of 2025, respectively, and $7 million and $23 million for the third quarter and first nine months of 2024, respectively.

**    Not meaningful.

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Net interest income increased by $4.3 billion to $12.4 billion in the third quarter of 2025 compared to the third quarter of 2024 and increased by $7.3 billion to $30.4 billion in the first nine months of 2025 compared to the first nine months of 2024 primarily driven by higher loan balances, including the impacts of the Transaction, and lower rates paid on deposits.

Net interest margin increased by 125 bps to 8.36% in the third quarter of 2025 compared to the third quarter of 2024 and increased by 86 bps to 7.69% in the first nine months of 2025 compared to the first nine months of 2024 primarily driven by higher loan balances, including the impacts of the Transaction, and lower rates paid on deposits.

Our total company cumulative interest-bearing deposit beta increased to 23% as of September 30, 2025, from 11% as of December 31, 2024. We define cumulative deposit beta as the ratio of changes in the average rate paid on our average interest-bearing deposits to changes in the upper bound of the federal funds rate during the current falling interest rate cycle.

Table 3 displays the change in our net interest income between periods and the extent to which the variance is attributable to:

•Changes in the volume of our interest-earning assets and interest-bearing liabilities; or

•Changes in the interest rates related to these assets and liabilities.

Table 3: Rate/Volume Analysis of Net Interest Income(1)

	Three Months Ended September 30,						Nine Months Ended September 30,
	2025 vs. 2024						2025 vs. 2024
(Dollars in millions)	Total Variance		Volume		Rate		Total Variance		Volume		Rate
Interest income:
Loans:
Credit card	$	4,531	$	5,174	$	(643)	$	7,031	$	8,198	$	(1,167)
Consumer banking	266		140		126		725		316		409
Commercial banking(2)	(175)		9		(184)		(600)		(50)		(550)
Other(3)	60		80		(20)		219		116		103
Total loans, including loans held for sale	4,682		5,403		(721)		7,375		8,580		(1,205)
Investment securities	90		46		44		257		107		150
Cash equivalents and other interest-earning assets	131		145		(14)		60		264		(204)
Total interest income	4,903		5,594		(691)		7,692		8,951		(1,259)
Interest expense:
Interest-bearing deposits	652		941		(289)		801		1,619		(818)
Securitized debt obligations	(69)		(39)		(30)		(248)		(153)		(95)
Senior and subordinated notes	(14)		68		(82)		(171)		70		(241)
Other borrowings and liabilities	6		3		3		8		5		3
Total interest expense	575		973		(398)		390		1,541		(1,151)
Net interest income	$	4,328	$	4,621	$	(293)	$	7,302	$	7,410	$	(108)

__________

(1)We calculate the change in interest income and interest expense separately for each item. The portion of interest income or interest expense attributable to both volume and rate is allocated proportionately when the calculation results in a positive value. When the portion of interest income or interest expense attributable to both volume and rate results in a negative value, the total amount is allocated to volume or rate, depending on which amount is positive. The portion of interest income or interest expense attributable to both volume and rate is calculated using rounded dollars in millions for average balances and interest income/expense.

(2)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.

(3)Interest income/expense in the Other category represents the impact of hedge accounting on our loan portfolios and the offsetting reduction of the taxable-equivalent adjustments of our commercial loans as described above.

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Non-Interest Income

Table 4 displays the components of non-interest income for the third quarter and first nine months of 2025 and 2024.

Table 4: Non-Interest Income

	Three Months Ended September 30,				Nine Months Ended September 30,
(Dollars in millions)	2025		2024		2025		2024
Discount and interchange fees, net	$	1,812	$	1,228	$	4,513	$	3,622
Service charges and other customer-related fees	849		501		2,016		1,422
Net securities losses	—		(35)		—		(35)
Other(1)(2)	294		244		910		803
Total non-interest income	$	2,955	$	1,938	$	7,439	$	5,812

__________

(1)Primarily consists of revenue from Capital One Shopping, treasury income, other investment income and auto industry services.

(2)Includes gains of $46 million and $87 million on deferred compensation plan investments in the third quarter and first nine months of 2025, respectively, and gains of $36 million and $89 million on deferred compensation plan investments in the third quarter and first nine months of 2024, respectively. These amounts have corresponding offsets in non-interest expense.

Non-interest income increased by $1.0 billion to $3.0 billion in the third quarter of 2025 and increased by $1.6 billion to $7.4 billion in the first nine months of 2025 primarily due to growth in our credit card portfolio and the impacts of acquiring the Global Payment Network, both as a result of the Transaction.

Provision for Credit Losses

Our provision for credit losses in each period is driven by net charge-offs, changes to the allowance for credit losses and changes to the reserve for unfunded lending commitments. Our provision for credit losses increased by $232 million to $2.7 billion in the third quarter of 2025 primarily driven by higher net charge-offs in Domestic Card as a result of the Transaction, partially offset by a larger net allowance release compared to the third quarter of 2024. Our provision for credit losses increased by $7.4 billion to $16.5 billion in the first nine months of 2025 primarily driven by the initial allowance for credit losses of $8.8 billion for non-PCD loans acquired in the Transaction.

We provide additional information on the provision for credit losses and changes in the allowance for credit losses within “Credit Risk Profile” and “Part I—Item 1. Financial Statements—Note 5—Allowance for Credit Losses and Reserve for Unfunded Lending Commitments.” For information on the allowance methodology for each of our loan categories, see “Part II—Item 8. Financial Statements and Supplementary Data—Note 1—Summary of Significant Accounting Policies” in our 2024 Form 10-K.

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Non-Interest Expense

Table 5 displays the components of non-interest expense for the third quarter and first nine months of 2025 and 2024.

Table 5: Non-Interest Expense

	Three Months Ended September 30,				Nine Months Ended September 30,
(Dollars in millions)	2025		2024		2025		2024
Operating expense:
Salaries and associate benefits(1)	$	3,496	$	2,391	$	9,041	$	7,069
Occupancy and equipment	856		587		2,208		1,692
Professional services	641		402		1,731		980
Communications and data processing	476		358		1,288		1,064
Amortization of intangibles	514		20		801		58
Other non-interest expense:
Bankcard, regulatory and other fee assessments	204		59		327		257
Collections	232		89		510		259
Other	441		295		1,300		831
Total other non-interest expense	877		443		2,137		1,347
Total operating expense	$	6,860	$	4,201	$	17,206	$	12,210
Marketing	1,403		1,113		3,950		3,187
Total non-interest expense	$	8,263	$	5,314	$	21,156	$	15,397

_________

(1)Includes expenses of $46 million and $87 million related to our deferred compensation plan investments for the third quarter and first nine months of 2025, respectively, and expenses of $36 million and $89 million related to our deferred compensation plan investments for the third quarter and first nine months of 2024, respectively. These amounts have corresponding offsets from investments in other non-interest income.

Non-interest expense increased by $2.9 billion to $8.3 billion in the third quarter of 2025 compared to the third quarter of 2024 and increased by $5.8 billion to $21.2 billion in the first nine months of 2025 compared to the first nine months of 2024 primarily driven by impacts from the Transaction, including integration expenses, as well as continued investments in technology.

For the three and nine months ended September 30, 2025, we incurred $348 million and $757 million, respectively, of integration expenses related to the Transaction, primarily driven by salaries and associate benefits and professional services, which are included within operating expense in our consolidated statements of income. Since the announcement of the Transaction in the first quarter of 2024, we have incurred $991 million of integration expenses as of September 30, 2025.

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Income Taxes

We recorded an income tax expense of $1.2 billion (27.1% effective income tax rate) and an income tax benefit of $152 million (negative 83.5% effective income tax rate) in the third quarter and first nine months of 2025, respectively, compared to an income tax expense of $441 million (19.9% effective income tax rate) and $797 million (17.9% effective income tax rate) in the third quarter and first nine months of 2024, respectively. Our effective tax rate on income from continuing operations varies between periods due, in part, to the impact of changes in pre-tax income and changes in tax credits, tax-exempt income and non-deductible expenses relative to our pre-tax earnings.

We recorded discrete tax benefits of $1 million and $177 million in the third quarter and first nine months of 2025, respectively.

Our effective tax rate in the third quarter of 2025 was computed utilizing the annual method. We changed our methodology from the year-to-date method utilized in the second quarter of 2025 due to the return of the proportional relationship between our tax provision, tax credit investments and pre-tax income.

We provide additional information on items affecting our income taxes and effective tax rate in “Part II—Item 8. Financial Statements and Supplementary Data—Note 16—Income Taxes” in our 2024 Form 10-K.

Loss from Discontinued Operations, Net of Tax

Loss from discontinued operations consists of results from the discontinued Home Loan business acquired as a part of the Transaction. Loss from discontinued operations, net of tax was $1 million and $15 million in the third quarter and first nine months of 2025, respectively. See “Part I—Item 1. Financial Statements—Note 2—Business Combinations and Discontinued Operations” for additional information.

CONSOLIDATED BALANCE SHEETS ANALYSIS

Total assets increased by $171.7 billion to $661.9 billion as of September 30, 2025 from December 31, 2024. The Transaction contributed $168.1 billion in identifiable assets as of the Closing Date. See “Part I—Item 1. Financial Statements—Note 2—Business Combinations and Discontinued Operations” for more information.

Total liabilities increased by $118.7 billion to $548.1 billion as of September 30, 2025 from December 31, 2024. The Transaction contributed $130.1 billion in identifiable liabilities as of the Closing Date, partially offset by maturities and paydowns of securitized debt obligations.

Stockholders’ equity increased by $53.0 billion to $113.8 billion as of September 30, 2025 from December 31, 2024 primarily driven by reissuance of treasury stock of $50.6 billion related to the Transaction and lower unrealized losses in accumulated other comprehensive loss.

The following is a discussion of material changes in the major components of our assets and liabilities during the first nine months of 2025. Period-end balance sheet amounts may vary from average balance sheet amounts due to the Transaction, timing of normal balance sheet management activities that are intended to support our capital and liquidity positions, our market risk profile and the needs of our customers.

Investment Securities

Our investment securities portfolio consists of the following: U.S. government-sponsored enterprise or agency (“GSE” or “Agency”) and non-agency residential mortgage-backed securities (“RMBS”), agency commercial mortgage-backed securities (“CMBS”), U.S. Treasury securities and other securities. Agency securities include securities guaranteed by the Government National Mortgage Association (“Ginnie Mae”) and securities issued by the Federal National Mortgage Association (“Fannie Mae”) and the Federal Home Loan Mortgage Corporation (“Freddie Mac”). The carrying value of our investments in Agency and U.S. Treasury securities represented 97% and 96% of our total investment securities portfolio as of September 30, 2025 and December 31, 2024, respectively.

The fair value of our investment securities portfolio increased by $6.7 billion to $89.7 billion as of September 30, 2025 from December 31, 2024 primarily driven by net securities acquired in the Transaction and decreases in relevant benchmark interest rates.

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Loans Held for Investment

Total loans held for investment consists of both unsecuritized loans and loans held in our consolidated trusts. Table 6 summarizes, by portfolio segment, the carrying value of our loans held for investment, the allowance for credit losses and net loan balance as of September 30, 2025 and December 31, 2024.

Table 6: Loans Held for Investment

	September 30, 2025						December 31, 2024
(Dollars in millions)	Loans		Allowance		Net Loans		Loans		Allowance		Net Loans
Credit Card	$	271,037	$	(19,727)	$	251,310	$	162,508	$	(12,974)	$	149,534
Consumer Banking	83,230		(1,878)		81,352		78,092		(1,884)		76,208
Commercial Banking	88,892		(1,498)		87,394		87,175		(1,400)		85,775
Total	$	443,159	$	(23,103)	$	420,056	$	327,775	$	(16,258)	$	311,517

Loans held for investment increased by $115.4 billion to $443.2 billion as of September 30, 2025 compared to December 31, 2024 primarily driven by the Transaction and growth in our auto loan portfolio. The Transaction contributed $108.2 billion of loans held for investment as of the Closing Date.

We provide additional information on the composition of our loan portfolio and credit quality in “Credit Risk Profile,” “Consolidated Results of Operations” and “Part I—Item 1. Financial Statements—Note 4—Loans.”

Funding Sources

Our funding sources include deposits, senior and subordinated notes, securitized debt obligations, federal funds purchased, securities loaned or sold under agreements to repurchase and advances from the Federal Home Loan Bank (“FHLB”) secured by certain portions of our loan and securities portfolios. Insured deposits in our Consumer Banking business represent our primary source of funding, as they are a relatively stable and low cost source of funding.

Table 7 provides the composition of our primary sources of funding as of September 30, 2025 and December 31, 2024.

Table 7: Funding Sources Composition

	September 30, 2025				December 31, 2024
(Dollars in millions)	Amount		% of Total		Amount		% of Total
Deposits:
Consumer Banking	$	416,765	80	%	$	318,329	78	%
Commercial Banking	29,920		6		31,691		8
Other(1)	22,100		4		12,687		3
Total deposits	468,785		90		362,707		89
Securitized debt obligations	13,642		3		14,264		3
Other debt	37,840		7		31,287		8
Total funding sources	$	520,267	100	%	$	408,258	100	%

__________

(1)Includes brokered deposits of $20.7 billion and $11.6 billion as of September 30, 2025 and December 31, 2024, respectively.

Total deposits increased by $106.1 billion to $468.8 billion as of September 30, 2025 from December 31, 2024 primarily driven by the Transaction, which contributed $106.9 billion of deposits as of the Closing Date.

As of September 30, 2025 and December 31, 2024, we held $71.3 billion and $64.9 billion, respectively, of estimated uninsured deposits. These amounts were primarily comprised of checking and savings deposits. These estimated uninsured deposits comprised approximately 15% and 18% of our total deposits as of September 30, 2025 and December 31, 2024, respectively. We estimate our uninsured amounts based on methodologies and assumptions used for our “Consolidated Reports of Condition and Income” (Federal Financial Institutions Examination Council (“FFIEC”) 031) filed with the Board of Governors of the Federal Reserve System (“Federal Reserve”), the Office of the Comptroller of the Currency (“OCC”) and the Federal Deposit Insurance Corporation (“FDIC”), hereafter collectively referred to as the “Federal Banking Agencies,” adjusted to exclude

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intercompany balances and cash collateral received on certain derivative contracts which are not presented within deposits on our consolidated balance sheet.

Securitized debt obligations decreased by $622 million to $13.6 billion as of September 30, 2025 from December 31, 2024 primarily driven by net maturities and paydowns.

Other debt increased by $6.6 billion to $37.8 billion as of September 30, 2025 from December 31, 2024 primarily driven by the Transaction, which contributed $7.5 billion of other debt as of the Closing Date.

We provide additional information on our funding sources in “Liquidity Risk Profile” and “Part I—Item 1. Financial Statements—Note 8—Deposits and Borrowings.”

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OFF-BALANCE SHEET ARRANGEMENTS

In the ordinary course of business, we engage in certain activities that are not reflected on our consolidated balance sheets, generally referred to as off-balance sheet arrangements. These activities typically involve transactions with unconsolidated variable interest entities (“VIEs”) as well as other arrangements, such as letters of credit, loan commitments and guarantees, to meet the financing needs of our customers and support their ongoing operations. We provide additional information regarding these types of activities in “Part I—Item 1. Financial Statements—Note 6—Variable Interest Entities and Securitizations” and “Part I—Item 1. Financial Statements—Note 14—Commitments, Contingencies, Guarantees and Others.”

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BUSINESS SEGMENT FINANCIAL PERFORMANCE

Our principal operations are organized for management reporting purposes into three major business segments, which are defined primarily based on the products and services provided or the types of customer served: Credit Card, Consumer Banking and Commercial Banking. The operations of acquired businesses have been integrated into or managed as a part of our existing business segments. Certain activities that are not part of a business segment are included in the Other category, such as the management of our corporate investment portfolio and asset/liability positions performed by our centralized Corporate Treasury group and any residual tax expense or benefit beyond what is assessed to our business segments in order to arrive at the consolidated effective tax rate. The Other category also includes unallocated corporate expenses that do not directly support the operations of the business segments or for which the business segments are not considered financially accountable in evaluating their performance, such as certain restructuring charges, integration expenses, and certain liabilities incurred by Discover ahead of the Transaction and not attributable to ongoing operations.

The assets and liabilities related to the acquired Home Loan business are presented separately within assets of discontinued operations and liabilities of discontinued operations on the consolidated balance sheets, and the operating results have been reflected as discontinued operations for all periods presented. As such, the related results have been excluded from continuing operations and business segment results.

The results of our individual businesses, which we report on a continuing operations basis, reflect the manner in which management evaluates performance and makes decisions about funding our operations and allocating resources. We may periodically change our business segments or reclassify business segment results based on modifications to our management reporting methodologies and changes in organizational alignment. Our business segment results are intended to reflect each segment as if it were a stand-alone business. We use an internal management and reporting process to derive our business segment results. Our internal management and reporting process employs various allocation methodologies, including funds transfer pricing, to assign certain balance sheet assets, deposits and other liabilities and their related revenues and expenses directly or indirectly attributable to each business. Total interest income and non-interest income are directly attributable to the segment in which they are reported. The net interest income of each segment reflects the results of our funds transfer pricing process, which is primarily based on a matched funding concept that takes into consideration market interest rates. Our funds transfer pricing process is managed by our centralized Corporate Treasury group and provides a funds credit for sources of funds, such as deposits generated by our Consumer Banking and Commercial Banking businesses, and a charge for the use of funds by each business. The allocation is unique to each business and is based on the composition of assets and liabilities. The funds transfer pricing process considers the interest rate and liquidity risk characteristics of assets and liabilities and off-balance sheet products. Periodically, the methodology and assumptions utilized in the funds transfer pricing process are adjusted to reflect economic conditions and other factors, which may impact the allocation of net interest income to the businesses. We regularly assess the assumptions, methodologies and reporting classifications used for segment reporting, which may result in the implementation of refinements or changes in future periods. We provide additional information on the allocation methodologies used to derive our business segment results in “Part II—Item 8. Financial Statements and Supplementary Data—Note 18—Business Segments and Revenue from Contracts with Customers” in our 2024 Form 10-K.

We refer to the business segment results derived from our internal management accounting and reporting process as our “managed” presentation, which differs in some cases from our reported results prepared based on U.S. GAAP. There is no comprehensive authoritative body of guidance for management accounting equivalent to U.S. GAAP; therefore, the managed presentation of our business segment results may not be comparable to similar information provided by other financial services companies. In addition, our individual business segment results should not be used as a substitute for comparable results determined in accordance with U.S. GAAP.

We summarize our business segment results for the third quarter and first nine months of 2025 and 2024 and provide a comparative discussion of these results below, as well as changes in our financial condition and credit performance metrics as of September 30, 2025 compared to December 31, 2024. We provide a reconciliation of our total business segment results to our reported consolidated results in “Part I—Item 1. Financial Statements—Note 13—Business Segments and Revenue from Contracts with Customers.”

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Business Segment Financial Performance

Table 8 summarizes our business segment results, which we report based on total net revenue (loss) and net income (loss) from continuing operations, for the third quarter and first nine months of 2025 and 2024.

Table 8: Business Segment Results

	Three Months Ended September 30,
	2025						2024
	Total Net Revenue (Loss)(1)			Net Income (Loss)(2)			Total Net Revenue (Loss)(1)			Net Income (Loss)(2)
(Dollars in millions)	Amount		% of Total	Amount		% of Total	Amount		% of Total	Amount		% of Total
Credit Card	$	11,607	76%	$	2,920	91%	$	7,252	72%	$	1,374	77%
Consumer Banking	2,832		18	420		13	2,210		22	403		23
Commercial Banking(3)	904		6	286		9	888		9	263		15
Other(3)	16		—	(433)		(13)	(336)		(3)	(263)		(15)
Total	$	15,359	100%	$	3,193	100%	$	10,014	100%	$	1,777	100%

	Nine Months Ended September 30,
	2025						2024
	Total Net Revenue (Loss)(1)			Net Income (Loss)(2)			Total Net Revenue (Loss)(1)			Net Income (Loss)(2)
(Dollars in millions)	Amount		% of Total	Amount		% of Total	Amount		% of Total	Amount		% of Total
Credit Card	$	27,867	74%	$	(778)	(233)%	$	20,800	72%	$	2,426	66%
Consumer Banking	7,514		20	1,056		316	6,577		23	1,255		34
Commercial Banking(3)	2,725		7	761		228	2,648		9	821		22
Other(3)	(255)		(1)	(705)		(211)	(1,103)		(4)	(848)		(22)
Total	$	37,851	100%	$	334	100%	$	28,922	100%	$	3,654	100%

__________

(1)Total net revenue (loss) consists of net interest income and non-interest income.

(2)Net income (loss) for our business segments and the Other category is based on income (loss) from continuing operations, net of tax.

(3)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.

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Credit Card Business

The primary sources of revenue for our Credit Card business are net interest income, net discount and interchange income and fees collected from customers. Expenses primarily consist of operating costs, the provision for credit losses and marketing expenses.

Our Credit Card business generated income from continuing operations, net of tax, of $2.9 billion and loss from continuing operations, net of tax, of $778 million in the third quarter and first nine months of 2025, respectively, compared to income from continuing operations, net of tax, of $1.4 billion and $2.4 billion in the third quarter and first nine months of 2024, respectively.

Table 9 summarizes the financial results of our Credit Card business and displays selected key metrics for the periods indicated.

Table 9: Credit Card Business Results

	Three Months Ended September 30,							Nine Months Ended September 30,
(Dollars in millions, except as noted)	2025			2024			Change	2025			2024			Change
Selected income statement data:
Net interest income	$	9,396		$	5,743		64%	$	22,343		$	16,309		37%
Non-interest income	2,211			1,509			47	5,524			4,491			23
Total net revenue(1)	11,607			7,252			60	27,867			20,800			34
Provision for credit losses	2,364			2,084			13	15,388			7,888			95
Non-interest expense	5,409			3,367			61	13,494			9,730			39
Income (loss) from continuing operations before income taxes	3,834			1,801			113	(1,015)			3,182			**
Income tax provision (benefit)	914			427			114	(237)			756			**
Income (loss) from continuing operations, net of tax	$	2,920		$	1,374		113	$	(778)		$	2,426		**
Selected performance metrics:
Average loans held for investment:
Domestic credit card	$	252,090		$	147,021		71	$	200,221		$	144,560		39
Personal loans	9,703			N/A			**	4,863			N/A			**
International card businesses	7,382			6,951			6	7,088			6,811			4
Total credit card	$	269,175		$	153,972		75	$	212,172		$	151,371		40
Average yield on loans(2)	17.99		%	19.66		%	(167)bps	18.08		%	19.10		%	(102)bps
Total net revenue margin(3)	17.25			18.82			(157)	17.51			18.28			(77)
Net charge-offs	$	3,101		$	2,154		44%	$	8,228		$	6,619		24%
Net charge-off rate(4)	4.61		%	5.60		%	(99)bps	5.17		%	5.83		%	(66)bps
Purchase volume	$	230,379		$	166,203		39%	$	589,780		$	481,517		22%
(Dollars in millions, except as noted)	September 30, 2025			December 31, 2024			Change
Selected period-end data:
Loans held for investment:
Domestic credit card	$	253,951		$	155,618		63%
Personal loans	9,646			N/A			**
International card businesses	7,440			6,890			8
Total credit card	$	271,037		$	162,508		67
30+ day performing delinquency rate	3.84		%	4.53		%	(69)bps
30+ day delinquency rate	3.84			4.54			(70)
Nonperforming loan rate(5)	0.01			0.01			—
Allowance for credit losses	$	19,727		$	12,974		52%
Allowance coverage ratio	7.28%			7.98		%	(70)bps

__________

(1)We recognize finance charges and fee income on open-ended loans in accordance with the contractual provisions of the credit arrangements and charge off any uncollectible amounts. Total net revenue was reduced by $869 million and $2.4 billion in the third quarter and first nine months of 2025,

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respectively, compared to $624 million and $1.9 billion in the third quarter and first nine months of 2024, respectively, for finance charges and fees charged off as uncollectible.

(2)Average yield is calculated based on annualized interest income for the period divided by average loans during the period and does not include any allocations, such as funds transfer pricing.

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

(4)Charge-offs exclude $19.4 billion of Discover loans acquired in the second quarter of 2025 that were fully charged-off, with expected recoveries of $3.3 billion included as a benefit to the allowance for credit losses.

(5)Within our credit card loan portfolio, certain loans in our international card and personal loan businesses are classified as nonperforming. See “Nonperforming Loans and Other Nonperforming Assets” for additional information.

**    Not meaningful.

Key factors affecting the results of our Credit Card business for the third quarter and first nine months of 2025 compared to the third quarter and first nine months of 2024, and changes in financial condition and credit performance between September 30, 2025 and December 31, 2024 include the following:

•Net Interest Income: Net interest income increased by $3.7 billion to $9.4 billion in the third quarter of 2025 and increased by $6.0 billion to $22.3 billion in the first nine months of 2025 primarily driven by higher loan balances, including the impacts of the Transaction.

•Non-Interest Income: Non-interest income increased by $702 million to $2.2 billion in the third quarter of 2025 and increased by $1.0 billion to $5.5 billion in the first nine months of 2025 primarily due to growth in our portfolio, including the impacts of the Transaction.

•Provision for Credit Losses: Provision for credit losses increased by $280 million to $2.4 billion in the third quarter of 2025 primarily driven by higher net charge-offs as a result of the Transaction, partially offset by a larger allowance release compared to the third quarter of 2024. Provision for credit losses increased by $7.5 billion to $15.4 billion in the first nine months of 2025 primarily driven by the initial allowance for credit losses for non-PCD loans acquired in the Transaction.

•Non-Interest Expense: Non-interest expense increased by $2.0 billion to $5.4 billion in the third quarter of 2025 and increased by $3.8 billion to $13.5 billion in the first nine months of 2025 primarily driven by the impacts of the Transaction and continued investments in technology.

Loans Held for Investment:

•Period-end loans held for investment increased by $108.5 billion to $271.0 billion as of September 30, 2025 from December 31, 2024 primarily driven by the Transaction. The Transaction contributed $108.2 billion in loans held for investment as of the Closing Date.

•Average loans held for investment increased by $115.2 billion to $269.2 billion in the third quarter of 2025 compared to the third quarter of 2024 and increased by $60.8 billion to $212.2 billion in the first nine months of 2025 compared to the first nine months of 2024 primarily driven by the Transaction.

Net Charge-Off and Delinquency Metrics:

•The net charge-off rate decreased by 99 bps to 4.61% in the third quarter of 2025 compared to the third quarter of 2024 and decreased by 66 bps to 5.17% in the first nine months of 2025 compared to the first nine months of 2024. The loan portfolio acquired as part of the Transaction decreased the net charge-off rate by 22 bps and 31 bps in the third quarter of 2025 and the first nine months of 2025, respectively.

•The 30+ day delinquency rate decreased by 70 bps to 3.84% as of September 30, 2025 from December 31, 2024 primarily due to the loan portfolio acquired as part of the Transaction.

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Domestic Card Business

The Domestic Card business generated income from continuing operations, net of tax, of $2.8 billion and loss from continuing operations, net of tax, of $476 million in the third quarter and first nine months of 2025, respectively, compared to income from continuing operations, net of tax, of $1.3 billion and $2.3 billion in the third quarter and first nine months of 2024, respectively. In the third quarter and first nine months of 2025 and 2024, the Domestic Card business accounted for greater than 90% of total net revenue of our Credit Card business.

Table 9.1 summarizes the financial results for our Domestic Card business and displays selected key metrics for the periods indicated.

Table 9.1: Domestic Card Business Results

	Three Months Ended September 30,							Nine Months Ended September 30,
(Dollars in millions, except as noted)	2025			2024			Change	2025			2024			Change
Selected income statement data:
Net interest income	$	8,766		$	5,434		61%	$	20,931		$	15,407		36%
Non-interest income	2,160			1,438			50	5,369			4,289			25
Total net revenue(1)	10,926			6,872			59	26,300			19,696			34
Provision for credit losses	2,163			1,997			8	14,219			7,589			87
Non-interest expense	5,092			3,149			62	12,706			9,120			39
Income (loss) from continuing operations before income taxes	3,671			1,726			113	(625)			2,987			**
Income tax provision (benefit)	873			407			114	(149)			705			**
Income (loss) from continuing operations, net of tax	$	2,798		$	1,319		112	$	(476)		$	2,282		**
Selected performance metrics:
Average loans held for investment	$	252,090		$	147,021		71	$	200,221		$	144,560		39
Average yield on loans(2)	17.99		%	19.62%			(163)bps	18.03		%	19.04		%	(101)bps
Total net revenue margin(3)	17.34			18.67			(133)	17.51			18.12			(61)
Net charge-offs	$	2,916		$	2,063		41%	$	7,824		$	6,356		23%
Net charge-off rate(4)	4.63%			5.61%			(98)bps	5.21		%	5.86		%	(65)bps
Purchase volume	$	226,147		$	162,281		39%	$	577,846		$	470,347		23%
(Dollars in millions, except as noted)	September 30, 2025			December 31, 2024			Change
Selected period-end data:
Loans held for investment	$	253,951		$	155,618		63%
30+ day performing delinquency rate	3.89		%	4.53		%	(64)bps
Allowance for credit losses	$	18,476		$	12,494		48%
Allowance coverage ratio	7.28		%	8.03		%	(75)bps

__________

(1)We recognize finance charges and fee income on open-ended loans in accordance with the contractual provisions of the credit arrangements and charge off any uncollectible amounts. Finance charges and fees charged off as uncollectible are reflected as a reduction in total net revenue.

(2)Average yield is calculated based on annualized interest income for the period divided by average loans during the period and does not include any allocations, such as funds transfer pricing.

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

(4) Charge-offs exclude $18.0 billion of Discover loans acquired in the second quarter of 2025 that were fully charged-off, with expected recoveries of $3.1 billion included as a benefit to the allowance for credit losses.

**    Not meaningful.

Because our Domestic Card business accounts for the substantial majority of our Credit Card business, the key factors driving the results are similar to the key factors affecting our total Credit Card business. Net income for our Domestic Card business increased in the third quarter of 2025 compared to the third quarter of 2024 primarily driven by:

•Higher net interest income primarily driven by higher loan balances, including the impacts of the Transaction.

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•Higher non-interest income primarily driven by growth in our portfolio, including the impacts of the Transaction.

These drivers were partially offset by:

•Higher non-interest expense primarily driven by the impacts of the Transaction and continued investments in technology.

Net income for our Domestic Card business decreased in the first nine months of 2025 compared to the first nine months of 2024 primarily driven by:

•Higher provision for credit losses primarily driven by the initial allowance for credit losses build for non-PCD loans acquired in the Transaction.

•Higher non-interest expense primarily driven by the impacts of the Transaction and continued investments in technology.

These drivers were partially offset by:

•Higher net interest income primarily driven by higher loan balances, including the impacts of the Transaction.

•Higher non-interest income primarily driven by growth in our portfolio, including the impacts of the Transaction.

Consumer Banking Business

The primary sources of revenue for our Consumer Banking business are net interest income from loans and deposits as well as service charges and customer-related fees, including revenue from processing transactions on the Global Payment Network. Expenses primarily consist of operating costs and the provision for credit losses.

Our Consumer Banking business generated income from continuing operations, net of tax, of $420 million and $1.1 billion in the third quarter and first nine months of 2025, respectively, and $403 million and $1.3 billion in the third quarter and first nine months of 2024, respectively.

Table 10 summarizes the financial results of our Consumer Banking business and displays selected key metrics for the periods indicated.

Table 10: Consumer Banking Business Results

	Three Months Ended September 30,					Nine Months Ended September 30,
(Dollars in millions, except as noted)	2025		2024		Change	2025		2024		Change
Selected income statement data:
Net interest income	$	2,357	$	2,028	16%	$	6,462	$	6,064	7%
Non-interest income	475		182		161	1,052		513		105
Total net revenue	2,832		2,210		28	7,514		6,577		14
Provision for credit losses	340		351		(3)	893		1,107		(19)
Non-interest expense	1,941		1,331		46	5,235		3,827		37
Income from continuing operations before income taxes	551		528		4	1,386		1,643		(16)
Income tax provision	131		125		5	330		388		(15)
Income from continuing operations, net of tax	$	420	$	403	4	$	1,056	$	1,255	(16)

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	Three Months Ended September 30,							Nine Months Ended September 30,
(Dollars in millions, except as noted)	2025			2024			Change	2025			2024			Change
Selected performance metrics:
Average loans held for investment:
Auto	$	81,094		$	74,920		8%	$	79,080		$	74,264		6%
Retail banking	1,201			1,262			(5)	1,224			1,291			(5)
Total consumer banking	$	82,295		$	76,182		8	$	80,304		$	75,555		6
Average yield on loans held for investment(1)	9.52		%	8.88%			64bps	9.28		%	8.59%			69bps
Average deposits	$	414,219		$	306,121		35%	$	366,854		$	300,475		22%
Average deposits interest rate	3.07		%	3.33		%	(26)bps	3.03		%	3.23		%	(20)bps
Net charge-offs	$	326		$	401		(19)%	$	899		$	1,134		(21)%
Net charge-off rate	1.58		%	2.11		%	(53)bps	1.49		%	2.00		%	(51)bps
Global Payment Network volume	$	153,117		N/A			**	$	227,131		N/A			**
Auto loan originations	10,731			$	9,158		17%	30,802			$	25,143		23%
(Dollars in millions, except as noted)	September 30, 2025			December 31, 2024			Change
Selected period-end data:
Loans held for investment:
Auto	$	82,035		$	76,829		7%
Retail banking	1,195			1,263			(5)
Total consumer banking	$	83,230		$	78,092		7
30+ day performing delinquency rate	4.93		%	5.87		%	(94)bps
30+ day delinquency rate	5.53			6.73			(120)
Nonperforming loan rate	0.73			0.99			(26)
Nonperforming asset rate(2)	0.82			1.08			(26)
Allowance for credit losses	$	1,878		$	1,884		—
Allowance coverage ratio	2.26		%	2.41		%	(15)bps
Deposits	$	416,765		$	318,329		31%

_________

(1)Average yield is calculated based on annualized interest income for the period divided by average loans during the period and does not include any allocations, such as funds transfer pricing.

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

**    Not meaningful.

Key factors affecting the results of our Consumer Banking business for the third quarter and first nine months of 2025 compared to the third quarter and first nine months of 2024, and changes in financial condition and credit performance between September 30, 2025 and December 31, 2024 include the following:

•Net Interest Income: Net interest income increased by $329 million to $2.4 billion in the third quarter of 2025 and increased by $398 million to $6.5 billion in the first nine months of 2025 primarily driven by higher deposits as a result of the Transaction and higher average loan balances in our auto business.

•Non-Interest Income: Non-interest income increased by $293 million to $475 million in the third quarter of 2025 and increased by $539 million to $1.1 billion in the first nine months of 2025 primarily driven by the impacts of acquiring the Global Payment Network in the Transaction.

•Provision for Credit Losses: Provision for credit losses decreased by $11 million to $340 million in the third quarter of 2025 and decreased by $214 million to $893 million in the first nine months of 2025 primarily driven by favorable credit performance in our auto loan portfolio.

•Non-Interest Expense: Non-interest expense increased by $610 million to $1.9 billion in the third quarter of 2025 primarily driven by the impacts of the Transaction and continued investments in technology. Non-interest expense

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increased by $1.4 billion to $5.2 billion in the first nine months of 2025 primarily driven by the impacts of the Transaction, an increase in the litigation accrual, and continued investments in technology.

Loans Held for Investment: 

•Period-end loans held for investment increased by $5.1 billion to $83.2 billion as of September 30, 2025 from December 31, 2024 primarily driven by growth in our auto loan portfolio.

•Average loans held for investment increased by $6.1 billion to $82.3 billion in the third quarter of 2025 compared to the third quarter of 2024 and increased by $4.7 billion to $80.3 billion in the first nine months of 2025 compared to the first nine months of 2024 primarily driven by growth in our auto loan portfolio.

Deposits: 

•Period-end deposits increased by $98.4 billion to $416.8 billion as of September 30, 2025 from December 31, 2024 primarily driven by the Transaction and continued growth from our national banking strategy. The Transaction contributed $91.7 billion in deposits as of the Closing Date.

Net Charge-Off and Delinquency Metrics: 

•The net charge-off rate decreased by 53 bps to 1.58% in the third quarter of 2025 compared to the third quarter of 2024 and decreased by 51 bps to 1.49% in the first nine months of 2025 compared to the first nine months of 2024 primarily driven by favorable credit performance in our auto loan portfolio.

•The 30+ day delinquency rate decreased by 120 bps to 5.53% as of September 30, 2025 compared to December 31, 2024.

Commercial Banking Business

The primary sources of revenue for our Commercial Banking business are net interest income from loans and deposits and non-interest income earned from products and services provided to our clients such as capital markets, advisory services, net interchange and treasury management. Because our Commercial Banking business has loans and investments that generate tax-exempt income, tax credits or other tax benefits, we present the revenues on a taxable-equivalent basis. Expenses primarily consist of operating costs and the provision for credit losses.

Our Commercial Banking business generated income from continuing operations, net of tax, of $286 million and $761 million in the third quarter and first nine months of 2025, respectively, and $263 million and $821 million in the third quarter and first nine months of 2024, respectively.

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Table 11 summarizes the financial results of our Commercial Banking business and displays selected key metrics for the periods indicated.

Table 11: Commercial Banking Business Results

	Three Months Ended September 30,							Nine Months Ended September 30,
(Dollars in millions, except as noted)	2025			2024			Change	2025			2024			Change
Selected income statement data:
Net interest income	$	586		$	596		(2)%	$	1,760		$	1,804		(2)%
Non-interest income	318			292			9	965			844			14
Total net revenue(1)	904			888			2	2,725			2,648			3
Provision for credit losses(2)	9			48			(81)	232			80			190
Non-interest expense	520			495			5	1,495			1,493			—
Income from continuing operations before income taxes	375			345			9	998			1,075			(7)
Income tax provision	89			82			9	237			254			(7)
Income from continuing operations, net of tax	$	286		$	263		9	$	761		$	821		(7)
Selected performance metrics:
Average loans held for investment:
Commercial and multifamily real estate	$	33,104		$	32,416		2	$	32,458		$	33,505		(3)
Commercial and industrial	55,285			55,685			(1)	55,630			55,496			—
Total commercial banking	$	88,389		$	88,101		—	$	88,088		$	89,001		(1)
Average yield on loans held for investment(1)(3)	6.42		%	7.25		%	(83)bps	6.37		%	7.21		%	(84)bps
Average deposits	$	29,889		$	30,365		(2)%	$	30,656		$	31,004		(1)%
Average deposits interest rate	2.13		%	2.55		%	(42)bps	2.11		%	2.58		%	(47)bps
Net charge-offs	$	46		$	49		(6)%	$	142		$	111		28%
Net charge-off rate	0.21		%	0.22		%	(1)bps	0.21		%	0.17		%	4bps
(Dollars in millions, except as noted)	September 30, 2025			December 31, 2024			Change
Selected period-end data:
Loans held for investment:
Commercial and multifamily real estate	$	33,461		$	31,903		5%
Commercial and industrial	55,431			55,272			—
Total commercial banking	$	88,892		$	87,175		2
Nonperforming loan rate	1.39		%	1.39		%	—
Nonperforming asset rate(4)	1.40			1.39			1bps
Allowance for credit losses(2)	$	1,498		$	1,400		7%
Allowance coverage ratio	1.69		%	1.61		%	8bps
Deposits	$	29,920		$	31,691		(6)%
Loans serviced for others	51,994			52,749			(1)

__________

(1)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.

(2)The provision for losses on unfunded lending commitments is included in the provision for credit losses in our consolidated statements of income and the related reserve is included in other liabilities on our consolidated balance sheets. Our reserve for unfunded lending commitments totaled $135 million and $143 million as of September 30, 2025 and December 31, 2024, respectively.

(3)Average yield is calculated based on annualized interest income for the period divided by average loans during the period and does not include any allocations, such as funds transfer pricing.

(4)Nonperforming assets consist of nonperforming loans 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 and other foreclosed assets.

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Key factors affecting the results of our Commercial Banking business for the third quarter and first nine months of 2025 compared to the third quarter and first nine months of 2024, and changes in financial condition and credit performance between September 30, 2025 and December 31, 2024 include the following:

•Net Interest Income: Net interest income decreased by $10 million to $586 million in the third quarter of 2025 compared to the third quarter of 2024 and decreased by $44 million to $1.8 billion in the first nine months of 2025 compared to the first nine months of 2024 primarily driven by lower margins.

•Non-Interest Income: Non-interest income increased by $26 million to $318 million in the third quarter of 2025 and increased by $121 million to $965 million in the first nine months of 2025 primarily driven by increased fees in our capital markets business.

•Provision for Credit Losses: Provision for credit losses decreased by $39 million to $9 million in the third quarter of 2025 primarily driven by a larger allowance release compared to the third quarter of 2024. Provision for credit losses increased by $152 million to $232 million in the first nine months of 2025 primarily driven by a net allowance build compared to an allowance release in the first nine months of 2024.

•Non-Interest Expense: Non-interest expense increased $25 million to $520 million in the third quarter of 2025 primarily driven by continued investments in technology. Non-interest expense remained substantially flat at $1.5 billion in the first nine months of 2025 compared to the first nine months of 2024.

Loans Held for Investment:

•Period-end loans held for investment increased by $1.7 billion to $88.9 billion as of September 30, 2025 from December 31, 2024 primarily due to originations outpacing customer payments.

•Average loans held for investment increased by $288 million to $88.4 billion in the third quarter of 2025 compared to the third quarter of 2024 primarily due to originations outpacing customer payments. Average loans held for investment decreased by $913 million to $88.1 billion in the first nine months of 2025 compared to the first nine months of 2024 primarily due to customer payments outpacing originations.

Deposits:

•Period-end deposits decreased by $1.8 billion to $29.9 billion as of September 30, 2025 from December 31, 2024 primarily driven by seasonality.

Net Charge-Off and Nonperforming Metrics:

•The net charge-off rate decreased by 1 bps to 0.21% in the third quarter of 2025 compared to the third quarter of 2024 and increased by 4 bps to 0.21% in the first nine months of 2025 compared to the first nine months of 2024.

•The nonperforming loan rate remained flat at 1.39% as of September 30, 2025 compared to December 31, 2024.

Other Category

Other includes unallocated amounts related to our centralized Corporate Treasury group activities, such as management of our corporate investment securities portfolio, asset/liability management and oversight of our funds transfer pricing process. Other also includes:

•unallocated corporate revenue and expenses that do not directly support the operations of the business segments or for which the business segments are not considered financially accountable in evaluating their performance, such as certain restructuring charges and integration expenses related to the Transaction;

•residual tax expense or benefit to arrive at the consolidated effective tax rate that is not assessed to our primary business segments; and

•foreign exchange rate fluctuations on foreign currency-denominated balances. As a result of our derivative management activities, we believe our net exposure to foreign exchange risk is minimal.

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Table 12 summarizes the financial results of our Other category for the periods indicated.

Table 12: Other Category Results

	Three Months Ended September 30,					Nine Months Ended September 30,
(Dollars in millions)	2025		2024		Change	2025		2024		Change
Selected income statement data:
Net interest income (loss)	$	65	$	(291)	**	$	(153)	$	(1,067)	(86)%
Non-interest loss	(49)		(45)		9%	(102)		(36)		183
Total net revenue (loss)(1)	16		(336)		**	(255)		(1,103)		(77)
Provision (benefit) for credit losses	1		(1)		**	—		(1)		**
Non-interest expense	393		121		**	932		347		169
Loss from continuing operations before income taxes	(378)		(456)		(17)	(1,187)		(1,449)		(18)
Income tax provision (benefit)	55		(193)		**	(482)		(601)		(20)
Loss from continuing operations, net of tax	$	(433)	$	(263)	65	$	(705)	$	(848)	(17)

__________

(1)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.

**    Not meaningful.

Loss from continuing operations, net of tax increased by $170 million to a loss of $433 million in the third quarter of 2025 compared to the third quarter of 2024 primarily driven by integration expenses related to the Transaction and a higher income tax provision, partially offset by higher treasury income.

Loss from continuing operations, net of tax decreased by $143 million to a loss of $705 million in the first nine months of 2025 compared to the first nine months of 2024 primarily driven by higher treasury income, partially offset by integration expenses related to the Transaction.

For the three and nine months ended September 30, 2025, we incurred $348 million and $757 million, respectively, of integration expenses related to the Transaction, primarily driven by salaries and associate benefits and professional services, which are included within operating expense in our consolidated statements of income. Since the announcement of the Transaction in the first quarter of 2024, we have incurred $991 million of integration expenses as of September 30, 2025.

CRITICAL ACCOUNTING POLICIES AND ESTIMATES

The preparation of financial statements in accordance with U.S. GAAP requires management to make a number of judgments, estimates and assumptions that affect the amount of assets, liabilities, income and expenses on the consolidated financial statements. Understanding our accounting policies and the extent to which we use management judgment and estimates in applying these policies is integral to understanding our financial statements. We provide a summary of our significant accounting policies under “Part II—Item 8. Financial Statements and Supplementary Data—Note 1—Summary of Significant Accounting Policies” in our 2024 Form 10-K.

We have identified the following accounting estimates as critical because they require significant judgments and assumptions about highly complex and inherently uncertain matters and the use of reasonably different estimates and assumptions could have a material impact on our results of operations or financial condition.

•Loan loss reserves

•Goodwill

•Fair value

•Customer rewards reserve

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We evaluate our critical accounting estimates and judgments on an ongoing basis and update them as necessary, based on changing conditions.

Goodwill

As of September 30, 2025, we recorded preliminary goodwill related to the Transaction of $13.8 billion based on provisional estimates as of the Closing Date. Goodwill related to the Transaction has been preliminarily allocated to the Credit Card ($6.8 billion) and Other Consumer Banking ($7.0 billion) reporting units. Fair value estimates related to the assets acquired and liabilities assumed are subject to adjustment for up to one year after the Closing Date as additional information becomes available (the “Measurement Period”). The Company may obtain additional information during the Measurement Period that could result in changes to the preliminary fair value of net assets acquired, the amount of preliminary goodwill, and the allocation of preliminary goodwill to reporting units. Total goodwill, including the preliminary goodwill resulting from the Transaction, was $28.9 billion as of September 30, 2025.

We perform our goodwill impairment test annually on October 1 at a reporting unit level. As of our last annual test and as of September 30, 2025, we had four reporting units with allocated goodwill: Credit Card, Auto, Other Consumer Banking and Commercial Banking.

We are required to test goodwill for impairment when a triggering event occurs that indicates it is more likely than not that the fair value of a reporting unit is below its carrying amount. During the third quarter of 2025, we concluded there were no triggering events and completed our qualitative assessment of impairment indicators, which included, among other things, an assessment of changes in macroeconomic conditions, comparison of the actual results to those forecasted in the most recent annual impairment test and performing sensitivity analysis on key assumptions. For the acquired Discover businesses, we also assessed the reasonableness of certain assumptions as of September 30, 2025, including the likelihood that expected synergies will be realized in the future.

The assumptions used in estimating the fair value of a reporting unit are judgmental and inherently uncertain. A change in the economic conditions of a reporting unit, such as declines in business performance as a result of industry or macroeconomic trends or changes in our strategy, adverse impacts to loan or deposit growth trends, decreases in revenue, increases in expenses, deterioration in a significant loan portfolio, increases in credit losses, increases in capital requirements, deterioration of market conditions, declines in long-term growth expectations, an increase in disposition activity, inability to achieve expected synergies from the Transaction, adverse impacts of regulatory or legislative changes, or increases in the estimated cost of capital could cause the estimated fair values of our reporting units to decline in the future, and increase the risk of a goodwill impairment in a future period. We perform sensitivity analyses around certain assumptions in order to assess the reasonableness of the assumptions and the resulting estimated fair values.

There have been no additional changes to our critical accounting policies and estimates described in our 2024 Form 10-K under “Part II—Item 7. MD&A—Critical Accounting Policies and Estimates.”

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ACCOUNTING CHANGES AND DEVELOPMENTS

Accounting Standards Issued but Not Adopted as of September 30, 2025

Standard	Guidance	Adoption Timing and Financial Statement Impacts
Income Tax Disclosures Accounting Standards Update (“ASU”) No. 2023-09, Income Taxes (Topic 740): Improvements to Income Tax Disclosures Issued December 2023	Requires entities to annually provide additional information on income tax rate reconciliations and make additional disclosures about income taxes paid.	Effective beginning with our annual period ending on December 31, 2025, with early adoption permitted. Prospective application is required and retrospective application is also permitted. We plan to adopt this standard for the above annual period and to apply the new requirements retrospectively. We are still assessing the extent of the impacts of adoption to our disclosures.
Disaggregation of Income Statement Expenses ASU No. 2024-03, Income Statement - Reporting Comprehensive Income - Expense Disaggregation Disclosures (Subtopic 220-40): Disaggregation of Income Statement Expenses Issued November 2024	Requires entities to separately disclose specific disaggregated expense categories on an annual and interim basis as well as disclose selling expenses on an annual basis.	Effective beginning with our annual period ending on December 31, 2027, with early adoption permitted. Prospective application is required and retrospective application is also permitted. We are still assessing the extent of the impacts of adoption to our disclosures.
Internal-Use Software ASU No. 2025-06, Intangibles - Goodwill and Other - Internal-Use Software (Subtopic 350-40): Targeted Improvements to the Accounting for Internal-Use Software Issued September 2025	Requires entities to capitalize costs associated with internal-use software based on a new methodology, which focuses on management’s authorization and commitment to funding the project and the probability that the software will be completed and used to perform the function intended.	Effective beginning with our interim period March 31, 2028, with early adoption permitted. Prospective, retrospective, and modified transition applications are each permitted. We are still assessing the extent of the impacts of adoption to our disclosures.

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CAPITAL MANAGEMENT

The level and composition of our capital are determined by multiple factors, including our consolidated regulatory capital requirements as described in more detail below and internal risk-based capital assessments such as internal stress testing. The level and composition of our capital may also be influenced by rating agency guidelines, subsidiary capital requirements, business environment, conditions in the financial markets and assessments of potential future losses due to adverse changes in our business and market environments.

Capital Standards and Prompt Corrective Action

The Company and the Bank are subject to the regulatory capital requirements established by the Federal Reserve and the OCC, respectively (the “Basel III Capital Rules”). The Basel III Capital Rules implement certain capital requirements published by the Basel Committee on Banking Supervision (“Basel Committee”), along with certain provisions of the Dodd-Frank Wall Street Reform and Consumer Protection Act of 2010 (“Dodd-Frank Act”) and other capital provisions.

As a bank holding company (“BHC”) with total consolidated assets of at least $250 billion but less than $700 billion and not exceeding any of the applicable risk-based thresholds, the Company is a Category III institution under the Basel III Capital Rules.

The Bank, as a subsidiary of a Category III institution, is a Category III bank. Moreover, the Bank, as an insured depository institution, is subject to prompt corrective action (“PCA”) capital regulations.

Basel III and U.S. Capital Rules

Under the Basel III Capital Rules, we must maintain a minimum CET1 capital ratio of 4.5%, a Tier 1 capital ratio of 6.0% and a total capital ratio of 8.0%, in each case in relation to risk-weighted assets. In addition, we must maintain a minimum leverage ratio of 4.0% and a minimum supplementary leverage ratio of 3.0%. We are also subject to the capital conservation buffer requirement and countercyclical capital buffer requirement, each as described below. Our capital and leverage ratios are calculated based on the Basel III standardized approach framework.

We have elected to exclude certain elements of accumulated other comprehensive income (“AOCI”) from our regulatory capital as permitted for a Category III institution. For information on the recognition of AOCI in regulatory capital under the proposed changes to the Basel III Capital Rules, see “Part I—Item 1. Business—Supervision and Regulation—Prudential Regulation of Banking—Capital and Stress Testing Regulation—Basel III Finalization Proposal” in our 2024 Form 10-K.

Global systemically important banks (“G-SIBs”) that are based in the U.S. are subject to an additional CET1 capital requirement known as the “G-SIB Surcharge.” We are not a G-SIB based on the most recent available data and thus we are not subject to a G-SIB Surcharge.

Stress Capital Buffer Rule

The Basel III Capital Rules require banking institutions to maintain a capital conservation buffer, composed of CET1 capital, above the regulatory minimum ratios. Under the Federal Reserve’s final rule to implement the stress capital buffer requirement (“Stress Capital Buffer Rule”), the Company’s “standardized approach capital conservation buffer” includes its stress capital buffer requirement (as described below), any G-SIB Surcharge (which is not applicable to us) and the countercyclical capital buffer requirement (which is currently set at 0%). Any determination to increase the countercyclical capital buffer generally would be effective twelve months after the announcement of such an increase, unless the Federal Reserve sets an earlier effective date.

The Company’s stress capital buffer requirement is recalibrated every year based on the Company’s supervisory stress test results. In particular, the Company’s stress capital buffer requirement equals, subject to a floor of 2.5%, the sum of (i) the difference between the Company’s starting CET1 capital ratio and its lowest projected CET1 capital ratio under the severely adverse scenario of the Federal Reserve’s supervisory stress test plus (ii) the ratio of the Company’s projected four quarters of common stock dividends (for the fourth to seventh quarters of the planning horizon) to the projected risk-weighted assets for the quarter in which the Company’s projected CET1 capital ratio reaches its minimum under the supervisory stress test.

Based on the Company’s 2024 supervisory stress test results, the Company’s stress capital buffer requirement for the period beginning on October 1, 2024 through September 30, 2025 was 5.5%. Therefore, the Company’s minimum capital requirements

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plus the standardized approach capital conservation buffer for CET1 capital, Tier 1 capital and total capital ratios under the stress capital buffer framework were 10.0%, 11.5% and 13.5%, respectively, for the period from October 1, 2024 through September 30, 2025.

Based on the Company’s 2025 supervisory stress test results, the Company’s final stress capital buffer requirement for the period beginning on October 1, 2025 through September 30, 2026 is 4.5%. Therefore, the Company’s minimum capital requirements plus the standardized approach capital conservation buffer for CET1 capital, Tier 1 capital and total capital ratios under the stress capital buffer framework are 9.0%, 10.5% and 12.5%, respectively, for the period from October 1, 2025 through September 30, 2026. For additional information regarding a proposed rulemaking to modify the stress capital buffer framework, including the recalibration and annual effective date of the stress capital buffer requirement, see “Part I—Item 2. MD&A—Supervision and Regulation” in our Q2 2025 Form 10-Q.

The Stress Capital Buffer Rule does not apply to the Bank. Pursuant to the OCC’s capital regulations, which are only applicable to the Bank, the capital conservation buffer for the Bank continues to be fixed at 2.5%. Therefore, the Bank’s minimum capital requirements plus its capital conservation buffer for CET1 capital, Tier 1 capital and total capital ratios are 7.0%, 8.5% and 10.5%, respectively.

If the Company or the Bank fails to maintain its capital ratios above the minimum capital requirements plus the applicable capital conservation buffers, it will face increasingly strict automatic limitations on capital distributions and discretionary bonus payments to certain executive officers.

As of September 30, 2025 and December 31, 2024, respectively, the Company and the Bank each exceeded the minimum capital requirements and the capital conservation buffer requirements applicable to them, and the Company and the Bank were each “well-capitalized.” The “well-capitalized” standards applicable to the Company are established in the Federal Reserve’s regulations, and the “well-capitalized” standards applicable to the Bank are established in the OCC’s PCA capital requirements.

Market Risk Rule

The “Market Risk Rule” supplements the Basel III Capital Rules by requiring institutions subject to the rule to adjust their risk-based capital ratios to reflect the market risk in their trading book. The Market Risk Rule generally applies to institutions with aggregate trading assets and liabilities equal to 10% or more of total assets or $1 billion or more. As of September 30, 2025, the Company and the Bank are subject to the Market Risk Rule. See “Market Risk Profile” below for additional information.

For the description of the regulatory capital rules to which we are subject, including recent proposed amendments to these rules under the Basel III Finalization Proposal, see “Part I—Item 1. Business—Supervision and Regulation” in our 2024 Form 10-K.

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Table 13 provides a comparison of our regulatory capital ratios under the Basel III standardized approach, the regulatory minimum capital adequacy ratios and the applicable well-capitalized standards as of September 30, 2025 and December 31, 2024.

Table 13: Capital Ratios Under Basel III(1)(2)(3)

	September 30, 2025						December 31, 2024
	Ratio		Minimum Capital Adequacy		Well- Capitalized		Ratio		Minimum Capital Adequacy		Well- Capitalized
Capital One Financial Corp:
Common equity Tier 1 capital(4)	14.4	%	4.5	%	N/A		13.5	%	4.5	%	N/A
Tier 1 capital(5)	15.5		6.0		6.0	%	14.8		6.0		6.0	%
Total capital(6)	17.3		8.0		10.0		16.4		8.0		10.0
Tier 1 leverage(7)	12.6		4.0		N/A		11.6		4.0		N/A
Supplementary leverage(8)	10.8		3.0		N/A		9.9		3.0		N/A
CONA:
Common equity Tier 1 capital(4)	13.5		4.5		6.5		13.6		4.5		6.5
Tier 1 capital(5)	13.5		6.0		8.0		13.6		6.0		8.0
Total capital(6)	15.1		8.0		10.0		15.2		8.0		10.0
Tier 1 leverage(7)	10.9		4.0		5.0		10.7		4.0		5.0
Supplementary leverage(8)	9.4		3.0		N/A		9.2		3.0		N/A

__________

(1)Capital requirements that are not applicable are denoted by “N/A.”

(2)Capital ratios as of December 31, 2024 reflect the Company’s and the Bank’s election to adopt the optional five-year transition period provided by the Federal Banking Agencies’ final rule (“CECL Transition Rule”) as of January 1, 2020, which was fully phased in effective January 1, 2025. For more information related to the CECL Transition Rule, see “Part II—Item 7. MD&A—Capital Management—Capital Standards and Prompt Corrective Action—CECL Transition Rule” in our 2024 Form 10-K.

(3)Ratios as of September 30, 2025 are preliminary and therefore subject to change until we file our September 30, 2025 Form FR Y-9C—Consolidated Financial Statements for Holding Companies and Call Reports.

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

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

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

(7)Tier 1 leverage ratio is a regulatory capital measure calculated based on Tier 1 capital divided by adjusted average assets.

(8)Supplementary leverage ratio is a regulatory capital measure calculated based on Tier 1 capital divided by total leverage exposure.

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Table 14 presents regulatory capital under the Basel III standardized approach and regulatory capital metrics as of September 30, 2025 and December 31, 2024.

Table 14: Regulatory Risk-Based Capital Components and Regulatory Capital Metrics(1)

(Dollars in millions)	September 30, 2025		December 31, 2024
Regulatory capital under Basel III standardized approach
Common equity excluding AOCI	$	114,323	$	65,823
Adjustments and deductions:
AOCI, net of tax(2)	68		1
Goodwill, net of related deferred tax liabilities	(28,575)		(14,786)
Other intangible and deferred tax assets, net of deferred tax liabilities	(12,846)		(231)
Common equity Tier 1 capital	72,970		50,807
Tier 1 capital instruments	5,407		4,845
Tier 1 capital	78,377		55,652
Tier 2 capital instruments	2,940		1,307
Qualifying allowance for credit losses	6,536		4,846
Tier 2 capital	9,476		6,153
Total capital	$	87,853	$	61,805
Regulatory capital metrics
Risk-weighted assets	$	506,535	$	377,145
Adjusted average assets(3)	622,435		480,794
Total leverage exposure(4)	727,738		559,399

__________

(1)Common equity as of December 31, 2024 reflects the Company’s and the Bank’s election to adopt the CECL Transition Rule as of January 1, 2020, which was fully phased in effective January 1, 2025. For more information related to the CECL Transition Rule, see “Part II—Item 7. MD&A—Capital Management—Capital Standards and Prompt Corrective Action—CECL Transition Rule” in our 2024 Form 10-K.

(2)Excludes certain components of AOCI in accordance with rules applicable to Category III institutions. See “Capital Management—Capital Standards and PCA—Basel III and U.S. Capital Rules” in this Report.

(3)Includes on-balance sheet asset adjustments subject to deduction from Tier 1 capital under the Basel III Capital Rules.

(4)Reflects on- and off-balance sheet amounts for the denominator of the supplementary leverage ratio as set forth by the Basel III Capital Rules.

Capital Planning and Regulatory Stress Testing

On October 20, 2025, our Board of Directors authorized the repurchase of up to $16 billion of shares of our common stock. Repurchases under the new share repurchase program were authorized to begin on October 21, 2025. This new authorization replaces the Company’s prior authorization to repurchase its common stock approved by our Board of Directors in April 2022. We repurchased $1.0 billion of shares of our common stock during the third quarter of 2025 and $1.3 billion of shares of our common stock during the first nine months of 2025.

On August 29, 2025, the Federal Reserve confirmed and announced individual stress capital buffer requirements for large banking institutions, including the Company. The Company’s final stress capital buffer requirement for the period beginning on October 1, 2025 through September 30, 2026 is 4.5%. Therefore, the Company’s minimum capital requirements plus the standardized approach capital conservation buffer for CET1 capital, Tier 1 capital and total capital ratios under the stress capital buffer framework are 9.0%, 10.5% and 12.5%, respectively, for the period from October 1, 2025 through September 30, 2026. For additional information regarding a proposed rulemaking to modify the stress capital buffer framework, including the recalibration and annual effective date of the stress capital buffer requirement, see “Part I—Item 2. MD&A—Supervision and Regulation” in our Q2 2025 Form 10-Q.

For the description of the regulatory capital planning rules and stress testing requirements to which we are subject, see “Part I—Item 1. Business—Supervision and Regulation” in our 2024 Form 10-K.

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Dividend Policy and Stock Purchases

In the first nine months of 2025, we declared and paid common stock dividends of $1.0 billion, or $1.80 per share. We declared and paid $179 million of preferred stock dividends in the first nine months of 2025. In addition, we declared $16 million of dividends on our Series O preferred stock that were not yet paid as of September 30, 2025.

The following table summarizes the dividends paid per share on our various preferred stock series in the first nine months of 2025.

Table 15: Preferred Stock Dividends Paid Per Share(1)

Series	Description	Issuance Date	Per Annum Dividend Rate	Dividend Frequency	2025
					Q3	Q2	Q1
Series I	5.000% Non-Cumulative	September 11, 2019	5.000%	Quarterly	$12.50	$12.50	$12.50
Series J	4.800% Non-Cumulative	January 31, 2020	4.800	Quarterly	12.00	12.00	12.00
Series K	4.625% Non-Cumulative	September 17, 2020	4.625	Quarterly	11.56	11.56	11.56
Series L	4.375% Non-Cumulative	May 4, 2021	4.375	Quarterly	10.94	10.94	10.94
Series M	3.950% Fixed Rate Reset Non-Cumulative	June 10, 2021	3.950% through 8/31/2026; resets 9/1/2026 and every subsequent 5 year anniversary at 5-Year Treasury Rate +3.157%	Quarterly	9.88	9.88	9.88
Series N	4.250% Non-Cumulative	July 29, 2021	4.250%	Quarterly	10.63	10.63	10.63
Series O	Fixed-to-Floating Rate Non-Cumulative	May 18, 2025	5.500% through 10/29/2027; resets 10/30/2027 and every quarter thereafter at three-month term SOFR + 3.338%	Semi-Annually through 10/30/2027; Quarterly thereafter	—	—	N/A
Series P(2)	6.125% Fixed-Rate Reset Non-Cumulative	May 18, 2025	6.125% through 9/22/2025; resets 9/23/2025 and every subsequent 5 year anniversary at 5-Year Treasury Rate +5.783%	Semi-Annually	N/A	1,650.35	N/A

__________

(1)For Series I, J, K, L, M, and N, the liquidation preference for each share of non-cumulative perpetual preferred stock is $1,000 per share of preferred stock. For Series O and P, the liquidation preference for each share of non-cumulative perpetual preferred stock is $100,000 per share of preferred stock. For Series I, J, K, L, and N, ownership is held in the form of depositary shares, each representing a 1/40th interest in a share of non-cumulative perpetual preferred stock. For Series O and P, ownership is held in the form of depositary shares, each representing a 1/100th interest in a share of non-cumulative perpetual preferred stock.

(2)Series P was fully redeemed on June 30, 2025.

The declaration and payment of dividends to our stockholders, as well as the amount thereof, are subject to the discretion of our Board of Directors and depend upon our results of operations, financial condition, capital levels, cash requirements, future prospects, regulatory requirements and other factors deemed relevant by the Board of Directors. For additional information related to capital distributions, see “Capital Management—Capital Planning and Regulatory Stress Testing” in this Report.

As a BHC, our ability to pay dividends is largely dependent upon the receipt of dividends or other payments from our subsidiaries. The Bank is subject to regulatory restrictions that limit its ability to transfer funds to our BHC. As of September 30, 2025, funds available for dividend payments from the Bank were $1.6 billion. There can be no assurance that we will declare and pay any dividends to stockholders.

On October 20, 2025, our Board of Directors authorized the repurchase of up to $16 billion of shares of our common stock.

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Repurchases under the new share repurchase program were authorized to begin on October 21, 2025. This new authorization replaces the Company’s prior authorization to repurchase its common stock approved by our Board of Directors in April 2022. We repurchased $1.0 billion of shares of our common stock during the third quarter of 2025 and $1.3 billion of shares of our common stock during the first nine months of 2025.

The timing and exact amount of any future common stock repurchases will depend on various factors, including market conditions, opportunities for growth, our capital position and the amount of retained earnings, as well as regulatory considerations. The Board authorized stock repurchase program does not include specific price targets or number of shares, may be executed through open market purchases, tender offers, or privately negotiated transactions, including utilizing Rule 10b5-1 plans, does not have a set expiration date and may be modified, suspended or terminated at any time. For additional information on dividends and stock repurchases, see “Capital Management—Capital Planning and Regulatory Stress Testing” and “Part II—Item 2. Unregistered Sales of Equity Securities and Use of Proceeds” in this Report, and “Part I—Item 1. Business—Supervision and Regulation—Prudential Regulation of Banking” and “Part I—Item 1. Business—Supervision and Regulation—Prudential Regulation of Banking—Funding and Dividends from Subsidiaries” in our 2024 Form 10-K.

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RISK MANAGEMENT

Risk Management Framework

Our Risk Management Framework (the “Framework”) sets consistent expectations for risk management across the Company. It also sets expectations for our “Three Lines of Defense” model, which defines the roles, responsibilities and accountabilities for taking and managing risk across the Company. Accountability for overseeing an effective Framework resides with our Board of Directors either directly or through its committees. The Company is in the process of integrating Discover into its existing risk management practices, policies and processes.

	First Line Identifies and Owns Risk	Second Line Advises & Challenges First Line	Third Line Provides Independent Assurance
Definition	Business areas that are accountable for risk and responsible for: i) generating revenue or reducing expenses; ii) supporting the business to provide products or services to customers; or iii) providing technology services for the first line.	Independent Risk Management (“IRM”) and Support Functions (e.g., Human Resources, Accounting, Legal) that provide support services to the Company.	Internal Audit and Credit Review.
Key Responsibilities	Identify, assess, measure, monitor, control and report the risks associated with their business.	IRM: Independently oversees and assesses risk taking activities for the first line of defense. Support Functions: Centers of specialized expertise that provide support services to the enterprise.	Provides independent and objective assurance to the Board of Directors and senior management that the systems and governance processes are designed and working as intended.

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Our Framework sets consistent expectations for risk management across the Company and consists of the following nine elements:

Governance and Accountability
Strategy and Risk Alignment
Risk Identification	Assessment, Measurement and Response	Monitoring and Testing	Aggregation, Reporting and Escalation
Capital and Liquidity Management (including Stress Testing)
Risk Data and Enabling Technology
Culture and Talent Management

We provide additional discussion of our risk management principles, roles and responsibilities, framework and risk appetite under “Part II—Item 7. MD&A—Risk Management” in our 2024 Form 10-K.

Risk Categories

We apply our Framework to protect the Company from the major categories of risk that we are exposed to through our business activities. We have seven major categories of risk as noted below. We provide a description of these categories and how we manage them under “Part II—Item 7. MD&A—Risk Management” in our 2024 Form 10-K.

•Compliance risk

•Credit risk

•Liquidity risk

•Market risk

•Operational risk

•Reputation risk

•Strategic risk

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CREDIT RISK PROFILE

Our loan portfolio accounts for the substantial majority of our credit risk exposure. Through the Transaction, we acquired new lending products, including personal loans. Our lending activities are governed under our credit policies and are subject to independent review and approval. Below we provide information about the composition of our loan portfolio, key concentrations and credit performance metrics.

We also engage in certain non-lending activities that may give rise to ongoing credit and counterparty settlement risk, including purchasing securities for our investment securities portfolio, entering into derivative transactions to manage our market risk exposure and to accommodate customers, extending short-term advances on syndication activity including bridge financing transactions we have underwritten, depositing certain operational cash balances in other financial institutions, executing certain foreign exchange transactions and extending customer overdrafts. We provide additional information related to our investment securities portfolio under “Consolidated Balance Sheets Analysis—Investment Securities” and “Part I—Item 1. Financial Statements—Note 3—Investment Securities” as well as credit risk related to derivative transactions in “Part I—Item 1. Financial Statements—Note 9—Derivative Instruments and Hedging Activities.”

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Geographic Composition

We market our credit card products throughout the United States, the U.K. and Canada. Our credit card loan portfolio is geographically diversified due to our product and marketing approach. The table below presents the geographic profile of our domestic credit card loan portfolio as of September 30, 2025 and December 31, 2024.

Table 16: Domestic Credit Card Portfolio by Geographic Region

	September 30, 2025				December 31, 2024
(Dollars in millions)	Amount		% of Total		Amount		% of Total
Domestic credit card:
California	$	24,534	9.7	%	$	15,978	10.3	%
Texas	22,424		8.8		13,430		8.6
Florida	19,344		7.6		12,039		7.7
New York	16,247		6.4		10,010		6.4
Pennsylvania	10,965		4.3		6,299		4.1
Illinois	10,680		4.2		5,921		3.8
Ohio	9,200		3.6		5,314		3.4
New Jersey	8,493		3.4		5,097		3.3
Georgia	8,183		3.2		4,965		3.2
North Carolina	7,159		2.8		4,477		2.9
Other	116,722		46.0		72,088		46.3
Total domestic credit card	$	253,951	100.0	%	$	155,618	100.0%

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Our auto loan portfolio is geographically diversified in the United States due to our product and marketing approach. The table below presents the geographic profile of our auto loan portfolio as of September 30, 2025 and December 31, 2024.

Table 17: Auto Loan Portfolio by Geographic Region

	September 30, 2025				December 31, 2024
(Dollars in millions)	Amount		% of Total		Amount		% of Total
Auto:
Texas	$	10,461	12.8	%	$	9,459	12.3	%
California	8,612		10.5		8,786		11.4
Florida	7,270		8.9		6,866		8.9
Ohio	3,891		4.7		3,402		4.4
Pennsylvania	3,729		4.5		3,408		4.4
Illinois	3,355		4.1		3,124		4.1
Georgia	3,235		3.9		2,962		3.9
North Carolina	2,686		3.3		2,504		3.3
Other	38,796		47.3		36,318		47.3
Total auto	$	82,035	100.0%		$	76,829	100.0%

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We originate commercial and multifamily real estate loans in most regions of the United States. The table below presents the geographic profile of our commercial real estate portfolio as of September 30, 2025 and December 31, 2024.

Table 18: Commercial Real Estate Portfolio by Region

	September 30, 2025				December 31, 2024
(Dollars in millions)	Amount		% of Total		Amount		% of Total
Geographic concentration:(1)
Northeast	$	11,803	35.3	%	$	12,152	38.1	%
South	8,505		25.4		7,900		24.8
Pacific West	5,132		15.3		4,213		13.2
Mid-Atlantic	3,216		9.6		2,901		9.1
Mountain	2,490		7.5		2,536		7.9
Midwest	2,315		6.9		2,201		6.9
Total	$	33,461	100.0	%	$	31,903	100.0	%

__________

(1)Geographic concentration is generally determined by the location of the borrower’s business or the location of the collateral associated with the loan. Northeast consists of CT, MA, ME, NH, NJ, NY, PA, RI and VT. South consists of AL, AR, FL, GA, KY, LA, MS, NC, OK, SC, TN and TX. Pacific West consists of: AK, CA, HI, OR and WA. Mid-Atlantic consists of DC, DE, MD, VA and WV. Midwest consists of: IA, IL, IN, KS, MI, MN, MO, ND, NE, OH, SD and WI. Mountain consists of: AZ, CO, ID, MT, NM, NV, UT and WY.

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Commercial Loans by Industry

Table 19 summarizes our commercial loans held for investment by industry classification as of September 30, 2025 and December 31, 2024. Industry classifications below are based on our interpretation of the Federal Loan Classification codes as they pertain to each individual loan.

Table 19: Commercial Loans by Industry

(Percentage of portfolio)	September 30, 2025		December 31, 2024
Industry Classification:
Finance	41	%	39	%
Real Estate & Construction	25		26
Government & Education	8		8
Commercial Services	3		4
Health Care & Pharmaceuticals	3		4
Oil, Gas & Pipelines	3		3
Technology, Telecommunications & Media	2		3
Other	15		13
Total	100	%	100	%

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Credit Risk Measurement

We closely monitor economic conditions and loan performance trends to assess and manage our exposure to credit risk. Trends in delinquency rates are the key credit quality indicator for our credit card, personal loans, and retail banking loan portfolios as changes in delinquency rates can provide an early warning of changes in potential future credit losses. The key indicator we monitor when assessing the credit quality and risk of our auto loan portfolio is borrower credit scores as they provide insight into borrower risk profiles, which give indications of potential future credit losses. The key credit quality indicator for our commercial loan portfolio is our internal risk ratings as we generally classify loans that have been delinquent for an extended period of time and other loans with significant risk of loss as nonperforming. In addition to these credit quality indicators, we also manage and monitor other credit quality metrics such as level of nonperforming loans and net charge-off rates.

We underwrite most consumer loans using proprietary models, which typically include credit bureau data, such as borrower credit scores, application information and, where applicable, collateral and deal structure data. We continuously adjust our management of credit lines and collection strategies based on customer behavior and risk profile changes. We also use borrower credit scores for subprime classification, for competitive benchmarking and, in some cases, to drive product segmentation decisions. 

Table 20 provides details on the credit scores of our domestic credit card, personal and auto loan portfolios as of September 30, 2025 and December 31, 2024.

Table 20: Credit Score Distribution

(Percentage of portfolio)	September 30, 2025		December 31, 2024
Domestic credit card—Refreshed FICO scores:(1)
Greater than 660	73	%	69	%
660 or below	27		31
Total	100	%	100	%
Personal loans—Refreshed FICO scores:(1)
Greater than 660	94	%	N/A
621 - 660	3		N/A
620 or below	3		N/A
Total	100	%	N/A
Auto—At origination FICO scores:(2)
Greater than 660	51	%	54	%
621 - 660	19		19
620 or below	30		27
Total	100	%	100	%

__________

(1)Percentages represent period-end loans held for investment in each credit score category. Domestic credit card and personal loan credit scores generally represent Fair Isaac Corporation (“FICO”) scores. These scores are obtained from one of the major credit bureaus at origination and are refreshed monthly thereafter and may be based on different versions of FICO over time. 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 for Domestic credit card and 620 or below for personal loans.

(2)Percentages represent period-end loans held for investment in each credit score category. Auto loan 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.

In our commercial loan portfolio, we assign internal risk ratings to loans based on relevant information about the ability of the borrowers to repay their debt. In determining the risk rating of a particular loan, some of the factors considered are the borrower’s current financial condition, historical and projected future credit performance, prospects for support from financially responsible guarantors, the estimated realizable value of any collateral and current economic trends.

We present information in the section below on the credit performance of our loan portfolio, including the key metrics we use in tracking changes in the credit quality of our loan portfolio. See “Part I—Item 1. Financial Statements—Note 4—Loans” for additional credit quality information. See “Part I—Item 1. Financial Statements—Note 1—Summary of Significant Accounting Policies” in this Report and “Part II—Item 8. Financial Statements and Supplementary Data—Note 1—Summary of Significant

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Accounting Policies” in our 2024 Form 10-K for information on our accounting policies for delinquent and nonperforming loans, charge-offs and loan modifications and restructurings for each of our loan categories.

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Delinquency Rates

We consider the entire balance of an account to be delinquent if the minimum required payment is not received by the customer’s due date, measured at each balance sheet date. Our 30+ day delinquency metrics include all loans held for investment that are 30 or more days past due, whereas our 30+ day performing delinquency metrics include all loans held for investment that are 30 or more days past due but are currently classified as performing and accruing interest. The 30+ day delinquency and 30+ day performing delinquency metrics are the same for domestic credit card loans, as we continue to classify these loans as performing until the account is charged off, typically when the account is 180 days past due. See “Part II—Item 8. Financial Statements and Supplementary Data—Note 1—Summary of Significant Accounting Policies” in our 2024 Form 10-K for information on our policies for classifying loans as nonperforming for each of our loan categories. We provide additional information on our credit quality metrics in “Business Segment Financial Performance.”

Table 21 presents our 30+ day performing delinquency rates and 30+ day delinquency rates of our portfolio of loans held for investment, by portfolio segment, as of September 30, 2025 and December 31, 2024.

Table 21: 30+ Day Delinquencies

	September 30, 2025								December 31, 2024
	30+ Day Performing Delinquencies				30+ Day Delinquencies				30+ Day Performing Delinquencies				30+ Day Delinquencies
(Dollars in millions)	Amount		Rate(1)		Amount		Rate(1)		Amount		Rate(1)		Amount		Rate(1)
Credit Card:
Domestic credit card	$	9,888	3.89	%	$	9,888	3.89	%	$	7,053	4.53	%	$	7,053	4.53	%
Personal loans	168		1.74		177		1.83		N/A		N/A		N/A		N/A
International card businesses	342		4.60		352		4.74		311		4.52		320		4.64
Total credit card	10,398		3.84		10,417		3.84		7,364		4.53		7,373		4.54
Consumer Banking:
Auto	4,094		4.99		4,587		5.59		4,572		5.95		5,229		6.81
Retail banking	11		0.89		15		1.26		14		1.12		26		2.05
Total consumer banking	4,105		4.93		4,602		5.53		4,586		5.87		5,255		6.73
Commercial Banking:
Commercial and multifamily real estate	59		0.18		96		0.29		40		0.13		170		0.53
Commercial and industrial	36		0.06		408		0.74		99		0.18		242		0.44
Total commercial banking	95		0.11		504		0.57		139		0.16		412		0.47
Total	$	14,598	3.29		$	15,523	3.50		$	12,089	3.69		$	13,040	3.98

__________

(1)Delinquency rates are calculated by dividing delinquency amounts by period-end loans held for investment for each specified loan category.

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Table 22 presents our 30+ day delinquent loans held for investment, by aging and geography, as of September 30, 2025 and December 31, 2024.

Table 22: Aging and Geography of 30+ Day Delinquent Loans

	September 30, 2025				December 31, 2024
(Dollars in millions)	Amount		Rate(1)		Amount		Rate(1)
Delinquency status:
30 – 59 days	$	6,144	1.39	%	$	5,276	1.61	%
60 – 89 days	3,750		0.84		3,138		0.96
> 90 days	5,629		1.27		4,626		1.41
Total	$	15,523	3.50	%	$	13,040	3.98	%
Geographic region:
Domestic	$	15,171	3.42	%	$	12,720	3.88	%
International	352		0.08		320		0.10
Total	$	15,523	3.50	%	$	13,040	3.98	%

__________

(1)Delinquency rates are calculated by dividing delinquency amounts by total period-end loans held for investment.

Table 23 summarizes loans that were 90+ days delinquent, in regards to interest or principal payments, and still accruing interest as of September 30, 2025 and December 31, 2024. These loans consist primarily of credit card accounts between 90 days and 179 days past due. As permitted by regulatory guidance issued by the FFIEC, we continue to accrue interest and fees on domestic credit card loans through the date of charge off, which is typically in the period the account becomes 180 days past due.

Table 23: 90+ Day Delinquent Loans Accruing Interest

	September 30, 2025				December 31, 2024
(Dollars in millions)	Amount		Rate(1)		Amount		Rate(1)
Loan portfolio segment:
Credit card	$	4,867	1.80	%	$	3,711	2.28	%
Commercial banking	40		0.05		96		0.11
Total	$	4,907	1.11		$	3,807	1.16
Geographic region:
Domestic	$	4,762	1.09	%	$	3,673	1.14	%
International	145		1.94		134		1.95
Total	$	4,907	1.11		$	3,807	1.16

__________

(1)Delinquency rates are calculated by dividing delinquency amounts by period-end loans held for investment for each specified loan category.

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Nonperforming Loans and Nonperforming Assets

Nonperforming loans include loans that have been placed on nonaccrual status. Nonperforming assets consist of nonperforming loans, repossessed assets and other foreclosed assets. See “Part II—Item 8. Financial Statements and Supplementary Data—Note 1—Summary of Significant Accounting Policies” in our 2024 Form 10-K for information on our policies for classifying loans as nonperforming for each of our loan categories.

Table 24 presents our nonperforming loans, by portfolio segment, and other nonperforming assets as of September 30, 2025 and December 31, 2024. We do not classify loans held for sale as nonperforming. We provide additional information on our credit quality metrics in “Business Segment Financial Performance.”

Table 24: Nonperforming Loans and Other Nonperforming Assets(1)

	September 30, 2025				December 31, 2024
(Dollars in millions)	Amount		Rate		Amount		Rate
Nonperforming loans held for investment:(2)
Credit Card:
Personal loans	$	13	0.13	%	N/A		N/A
International card businesses	12		0.16		$	10	0.15	%
Total credit card	25		0.01		10		0.01
Consumer Banking:
Auto	584		0.71		750		0.98
Retail banking	20		1.65		25		1.94
Total consumer banking	604		0.73		775		0.99
Commercial Banking:
Commercial and multifamily real estate	353		1.05		509		1.60
Commercial and industrial	883		1.59		701		1.27
Total commercial banking	1,236		1.39		1,210		1.39
Total nonperforming loans held for investment(3)	1,865		0.42		1,995		0.61
Other nonperforming assets(4)	86		0.02		65		0.02
Total nonperforming assets	$	1,951	0.44		$	2,060	0.63

__________

(1)We recognized interest income for loans classified as nonperforming of $54 million and $70 million in the first nine months of 2025 and 2024, respectively.

(2)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.

(3)Excluding the impact of domestic credit card loans, nonperforming loans as a percentage of total loans held for investment was 0.99% and 1.16% as of September 30, 2025 and December 31, 2024, respectively.

(4)The denominators used in calculating nonperforming asset rates consist of total loans held for investment and other nonperforming assets.

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Net Charge-Offs

Net charge-offs consist of the amortized cost basis, excluding accrued interest, of loans held for investment that we determine to be uncollectible, net of recovered amounts. We charge off loans as a reduction to the allowance for credit losses when we determine the loan is uncollectible and record subsequent recoveries of previously charged off amounts as increases to the allowance for credit losses. Uncollectible finance charges and fees are reversed through revenue and certain fraud losses are recorded in other non-interest expense. Generally, costs to recover charged off loans are recorded as collection expenses as incurred and are included in our consolidated statements of income as a component of other non-interest expense. Our charge-off policy for loans varies based on the loan type. See “Part II—Item 8. Financial Statements and Supplementary Data—Note 1—Summary of Significant Accounting Policies” in our 2024 Form 10-K for information on our charge-off policy for each of our loan categories.

Table 25 presents our net charge-off amounts and rates, by portfolio segment, in the third quarter and first nine months of 2025 and 2024.

Table 25: Net Charge-Offs (Recoveries)

	Three Months Ended September 30,								Nine Months Ended September 30,
	2025				2024				2025				2024
(Dollars in millions)	Amount		Rate(1)		Amount		Rate(1)		Amount		Rate(1)		Amount		Rate(1)
Credit Card(2):
Domestic credit card	$	2,916	4.63	%	$	2,063	5.61	%	$	7,824	5.21	%	$	6,356	5.86	%
Personal loans	92		3.81		N/A		N/A		134		3.67		N/A		N/A
International card businesses	93		5.07		91		5.23		270		5.09		263		5.14
Total credit card	3,101		4.61		2,154		5.60		8,228		5.17		6,619		5.83
Consumer Banking:
Auto	313		1.54		384		2.05		857		1.44		1,086		1.95
Retail banking	13		4.41		17		5.43		42		4.57		48		4.94
Total consumer banking	326		1.58		401		2.11		899		1.49		1,134		2.00
Commercial Banking:
Commercial and multifamily real estate	(8)		(0.09)		20		0.26		(5)		(0.02)		47		0.19
Commercial and industrial	54		0.38		29		0.20		147		0.35		64		0.15
Total commercial banking	46		0.21		49		0.22		142		0.21		111		0.17
Total net charge-offs	$	3,473	3.16		$	2,604	3.27		$	9,269	3.25		$	7,864	3.32
Average loans held for investment	$	439,859			$	318,255			$	380,564			$	315,927

__________

(1)Net charge-off rates are calculated by dividing annualized net charge-offs by average loans held for investment for the period for each loan category.

(2)Charge-offs exclude $19.4 billion of Discover loans acquired in the second quarter of 2025 that were fully charged-off, with expected recoveries of $3.3 billion included as a benefit to the allowance for credit losses.

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Financial Difficulty Modifications to Borrowers

A financial difficulty modification (“FDM”) occurs when a modification in the form of principal forgiveness, interest rate reduction, an other-than-insignificant payment delay, a term extension or a combination of these modifications is granted to a borrower experiencing financial difficulty.

As part of our loss mitigation efforts, we may provide short-term (one to twelve months) or long-term (greater than twelve months) modifications to a borrower experiencing financial difficulty to improve long-term collectibility of the loan and to avoid the need for repossession or foreclosure of collateral.

We consider the impact of all loan modifications, including FDMs, when estimating the credit quality of our loan portfolio and establishing allowance levels. For our Commercial Banking customers, loan modifications are also considered in the assignment of an internal risk rating.

In our Credit Card business, the majority of our FDMs receive an interest rate reduction and are placed on a fixed payment plan not exceeding 60 months. If the customer does not comply with the modified payment terms, then the credit card loan agreement may revert to its original payment terms, generally resulting in any loan outstanding being reflected in the appropriate delinquency category and charged off in accordance with our standard charge-off policy.

In our Consumer Banking business, the majority of our FDMs receive an extension, an interest rate reduction, principal reduction, or a combination of these modifications.

In our Commercial Banking business, the majority of our FDMs receive an extension. A portion of FDMs receive an interest rate reduction, principal reduction, or a combination of modifications.

For more information on FDMs, see “Part I—Item 1. Financial Statements—Note 4—Loans.”

Allowance for Credit Losses and Reserve for Unfunded Lending Commitments

Our allowance for credit losses represents management’s current estimate of expected credit losses over the contractual terms of our loans held for investment as of each balance sheet date. Expected recoveries of amounts previously charged off or expected to be charged off are recognized within the allowance. We also estimate expected credit losses related to unfunded lending commitments that are not unconditionally cancellable. The provision for losses on unfunded lending commitments is included in the provision for credit losses in our consolidated statements of income and the related reserve for unfunded lending commitments is included in other liabilities on our consolidated balance sheets. We provide additional information on the methodologies and key assumptions used in determining our allowance for credit losses in “Part II—Item 8. Financial Statements and Supplementary Data—Note 1—Summary of Significant Accounting Policies” in our 2024 Form 10-K.

Table 26 presents changes in our allowance for credit losses and reserve for unfunded lending commitments for the third quarter and first nine months of 2025 and 2024, and details by portfolio segment for the provision for credit losses, charge-offs and recoveries.

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Table 26: Allowance for Credit Losses and Reserve for Unfunded Lending Commitments Activity

	Three Months Ended September 30, 2025
	Credit Card								Consumer Banking
(Dollars in millions)	Domestic Card		Personal Loans		International Card Businesses		Total Credit Card		Auto		Retail Banking		Total Consumer Banking		Commercial Banking		Total
Allowance for credit losses:
Balance as of June 30, 2025	$	19,229	$	762	$	483	$	20,474	$	1,838	$	26	$	1,864	$	1,535	$	23,873
Charge-offs	(3,951)		(121)		(139)		(4,211)		(651)		(18)		(669)		(61)		(4,941)
Recoveries(1)	1,035		29		46		1,110		338		5		343		15		1,468
Net charge-offs	(2,916)		(92)		(93)		(3,101)		(313)		(13)		(326)		(46)		(3,473)
Provision for credit losses	2,163		97		104		2,364		330		10		340		9		2,713
Allowance build (release) for credit losses	(753)		5		11		(737)		17		(3)		14		(37)		(760)
Other changes(2)	—		—		(10)		(10)		—		—		—		—		(10)
Balance as of September 30, 2025	18,476		767		484		19,727		1,855		23		1,878		1,498		23,103
Reserve for unfunded lending commitments:
Balance as of June 30, 2025	—		—		—		—		—		—		—		135		135
Provision for losses on unfunded lending commitments	—		—		—		—		—		—		—		—		—
Balance as of September 30, 2025	—		—		—		—		—		—		—		135		135
Combined allowance and reserve as of September 30, 2025	$	18,476	$	767	$	484	$	19,727	$	1,855	$	23	$	1,878	$	1,633	$	23,238

	Nine Months Ended September 30, 2025
	Credit Card								Consumer Banking
(Dollars in millions)	Domestic Card		Personal Loans		International Card Businesses		Total Credit Card		Auto		Retail Banking		Total Consumer Banking		Commercial Banking		Total
Allowance for credit losses:
Balance as of December 31, 2024	$	12,494	—		$	480	$	12,974	$	1,859	$	25	$	1,884	$	1,400	$	16,258
Charge-offs(3)	(10,199)		$	(177)	(403)		(10,779)		(1,900)		(57)		(1,957)		(180)		(12,916)
Recoveries(1)	2,375		43		133		2,551		1,043		15		1,058		38		3,647
Net charge-offs	(7,824)		(134)		(270)		(8,228)		(857)		(42)		(899)		(142)		(9,269)
Initial allowance for purchased credit deteriorated loans	2,722		148		—		2,870		—		—		—		—		2,870
Benefit from expected recoveries of charged off loans(4)	(3,135)		(170)		—		(3,305)		—		—		—		—		(3,305)
Provision for credit losses(5)	14,219		923		246		15,388		853		40		893		240		16,521
Allowance build (release) for credit losses	5,982		767		(24)		6,725		(4)		(2)		(6)		98		6,817
Other changes(2)	—		—		28		28		—		—		—		—		28
Balance as of September 30, 2025	18,476		767		484		19,727		1,855		23		1,878		1,498		23,103
Reserve for unfunded lending commitments:
Balance as of December 31, 2024	—		—		—		—		—		—		—		143		143
Provision (benefit) for losses on unfunded lending commitments	—		—		—		—		—		—		—		(8)		(8)
Balance as of September 30, 2025	—		—		—		—		—		—		—		135		135
Combined allowance and reserve as of September 30, 2025	$	18,476	$	767	$	484	$	19,727	$	1,855	$	23	$	1,878	$	1,633	$	23,238

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	Three Months Ended September 30, 2024
	Credit Card							Consumer Banking
(Dollars in millions)	Domestic Card		Personal Loans	International Card Businesses		Total Credit Card		Auto		Retail Banking		Total Consumer Banking		Commercial Banking		Total
Allowance for credit losses:
Balance as of June 30, 2024	$	12,560	N/A	$	480	$	13,040	$	2,037	$	28	$	2,065	$	1,544	$	16,649
Charge-offs	(2,501)		N/A	(131)		(2,632)		(684)		(23)		(707)		(88)		(3,427)
Recoveries(1)	438		N/A	40		478		300		6		306		39		823
Net charge-offs	(2,063)		N/A	(91)		(2,154)		(384)		(17)		(401)		(49)		(2,604)
Provision for credit losses	1,997		N/A	87		2,084		335		16		351		35		2,470
Allowance release for credit losses	(66)		N/A	(4)		(70)		(49)		(1)		(50)		(14)		(134)
Other changes(2)	—		N/A	19		19		—		—		—		—		19
Balance as of September 30, 2024	12,494		N/A	495		12,989		1,988		27		2,015		1,530		16,534
Reserve for unfunded lending commitments:
Balance as of June 30, 2024	—		N/A	—		—		—		—		—		129		129
Provision for losses on unfunded lending commitments	—		N/A	—		—		—		—		—		13		13
Balance as of September 30, 2024	—		N/A	—		—		—		—		—		142		142
Combined allowance and reserve as of September 30, 2024	$	12,494	N/A	$	495	$	12,989	$	1,988	$	27	$	2,015	$	1,672	$	16,676

	Nine Months Ended September 30, 2024
	Credit Card							Consumer Banking
(Dollars in millions)	Domestic Card		Personal Loans	International Card Businesses		Total Credit Card		Auto		Retail Banking		Total Consumer Banking		Commercial Banking		Total
Allowance for credit losses:
Balance as of December 31, 2023	$	11,261	N/A	$	448	$	11,709	$	2,002	$	40	$	2,042	$	1,545	$	15,296
Charge-offs	(7,509)		N/A	(383)		(7,892)		(1,941)		(62)		(2,003)		(166)		(10,061)
Recoveries(1)	1,153		N/A	120		1,273		855		14		869		55		2,197
Net charge-offs	(6,356)		N/A	(263)		(6,619)		(1,086)		(48)		(1,134)		(111)		(7,864)
Provision for credit losses	7,589		N/A	299		7,888		1,072		35		1,107		96		9,091
Allowance build (release) for credit losses	1,233		N/A	36		1,269		(14)		(13)		(27)		(15)		1,227
Other changes(2)	—		N/A	11		11		—		—		—		—		11
Balance as of September 30, 2024	12,494		N/A	495		12,989		1,988		27		2,015		1,530		16,534
Reserve for unfunded lending commitments:
Balance as of December 31, 2023	—		N/A	—		—		—		—		—		158		158
Provision (benefit) for losses on unfunded lending commitments	—		N/A	—		—		—		—		—		(16)		(16)
Balance as of September 30, 2024	—		N/A	—		—		—		—		—		142		142
Combined allowance and reserve as of September 30, 2024	$	12,494	N/A	$	495	$	12,989	$	1,988	$	27	$	2,015	$	1,672	$	16,676

__________

(1)The amount and timing of recoveries are impacted by our collection strategies, which are based on customer behavior and risk profile and include direct customer communications, repossession of collateral, the periodic sale of charged off loans as well as additional strategies, such as litigation.

(2)Primarily represents foreign currency translation adjustments.

(3)Charge-offs exclude $19.4 billion of Discover loans acquired in the second quarter of 2025 that were fully charged-off, with expected recoveries of $3.3 billion included as a benefit to the allowance for credit losses.

(4)Represents contractual rights to collect on recoveries of acquired Discover loans that are charged off.

(5)The provision for credit losses includes the initial allowance for credit losses of $8.8 billion for non-PCD loans acquired in the Transaction.

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LIQUIDITY RISK PROFILE

We manage our funding and liquidity risk in an integrated manner in support of the current and future cash flow needs of our business. We maintained liquidity reserves of $143.1 billion and $123.8 billion as of September 30, 2025 and December 31, 2024, respectively, as shown in Table 27 below. Included in liquidity reserves are cash and cash equivalents, investment securities and FHLB borrowing capacity secured by loans.

As of September 30, 2025, we had available issuance capacity of $53.2 billion under shelf registrations associated with our credit card and auto loan securitization programs. We also maintain a shelf registration that enables us to issue an indeterminate amount of senior or subordinated debt securities, preferred stock, depositary shares, common stock, purchase contracts, warrants and units. Our ability to issue under each shelf registration is subject to market conditions.

Finally, as of September 30, 2025, we had access to available contingent liquidity sources totaling $100.6 billion through the prepositioning of collateral, including a portion of the investment securities included in the liquidity reserves amount in the following table, at the Federal Reserve Discount Window, the Standing Repo Facility, FHLB and the Fixed Income Clearing Corporation—Government Securities Division (“FICC - GSD”).

As of September 30, 2025 and December 31, 2024, our funding sources totaled $520.3 billion and $408.3 billion, respectively, primarily composed of consumer deposits, as shown in “Consolidated Balance Sheets Analysis—Table 7: Funding Sources Composition.”

Our liquidity reserves, borrowing capacity, contingent liquidity sources and total funding sources are all discussed in more detail in the following sections.

Table 27 below presents the composition of our liquidity reserves as of September 30, 2025 and December 31, 2024.

Table 27: Liquidity Reserves

(Dollars in millions)	September 30, 2025		December 31, 2024
Cash and cash equivalents	$	55,279	$	43,230
Securities available for sale(1)	89,733		83,013
FHLB borrowing capacity secured by loans	4,167		4,279
Outstanding FHLB advances and letters of credit secured by loans and investment securities	(632)		(48)
Other encumbrances of investment securities	(5,476)		(6,648)
Total liquidity reserves	$	143,071	$	123,826

________

(1)    Includes securities that have been pledged or otherwise encumbered within the below Liquidity Reserves line items “Outstanding FHLB advances and letters of credit secured by loans and investment securities” and “Other encumbrances of investment securities.”

Our liquidity reserves increased by $19.2 billion to $143.1 billion as of September 30, 2025 from December 31, 2024, primarily due to increases in cash and cash equivalents acquired in the Transaction. In addition to these liquidity reserves, we maintain access to a diversified mix of funding sources as discussed in the “Borrowing Capacity” and “Funding” sections below. See “Part II—Item 7. MD&A—Risk Management” in our 2024 Form 10-K for additional information on our management of liquidity risk.

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Liquidity Coverage Ratio

We are subject to the final rules published by the Basel Committee and as implemented by the Federal Reserve and the OCC for the Basel III Liquidity Coverage Ratio (“LCR”) in the United States (the “LCR Rule”). The LCR Rule requires each of the Company and the Bank to calculate its respective LCR daily. It also requires the Company to publicly disclose, on a quarterly basis, its LCR, certain related quantitative liquidity metrics, and a qualitative discussion of its LCR. Our average LCR during the third quarter of 2025 was 161%, which exceeded the LCR Rule requirement of 100%. The calculation and the underlying components are based on our interpretations, expectations and assumptions of relevant regulations, as well as interpretations provided by our regulators, and are subject to change based on changes to future regulations and interpretations. See “Part I—Item 1. Business—Supervision and Regulation” in our 2024 Form 10-K for additional information.

Net Stable Funding Ratio

We are subject to the final rules published by the Basel Committee and as implemented by the Federal Reserve and the OCC for the Basel III Net Stable Funding Ratio (“NSFR”) in the United States (the “NSFR Rule”). The NSFR Rule requires each of the Company and the Bank to maintain an NSFR of 100% on an ongoing basis. It also requires the Company to publicly disclose, on a semi-annual basis each second and fourth quarter, its NSFR, certain related quantitative liquidity metrics and qualitative discussion of its NSFR. Our average NSFR for the third quarter of 2025 exceeded the NSFR Rule requirement of 100%. The calculation and the underlying components are based on our interpretations, expectations and assumptions of the relevant regulations, as well as interpretations provided by our regulators, and are subject to change based on changes to future regulations and interpretations. See “Part I—Item 1. Business—Supervision and Regulation” in our 2024 Form 10-K for additional information.

Borrowing Capacity

We maintain a shelf registration with the U.S. Securities and Exchange Commission (“SEC”) so that we may periodically offer and sell an indeterminate aggregate amount of senior or subordinated debt securities, preferred stock, depositary shares, common stock, purchase contracts, warrants and units. There is no limit under this shelf registration to the amount or number of such securities that we may offer and sell, subject to market conditions. In addition, we also maintain a shelf registration associated with our Capital One Multi-asset Execution Trust (“COMET”) that allows us to periodically offer and sell up to $24.0 billion of securitized debt obligations, a shelf registration associated with our Discover Card Execution Note Trust (“DCENT”) that allows us to periodically offer and sell up to $12.1 billion of securitized debt obligations, and a shelf registration associated with our Capital One Prime Auto Receivables Trusts (“COPAR”) that allows us to periodically offer and sell up to $18.6 billion of securitized debt obligations. These shelf registration statements are subject to periodic renewal and, thus, change, which may be reviewed by the SEC at the time of each such renewal. As part of each periodic renewal, we assess registered amounts under each shelf registration statement which may be updated as appropriate. As of September 30, 2025, we had $22.5 billion, $12.1 billion and $18.6 billion of available issuance capacity in our COMET, DCENT and COPAR securitization programs, respectively.

In addition to our issuance capacity under the shelf registration statements, we also have collateral pledged to support our access to FHLB advances, the Federal Reserve Discount Window, the Standing Repo Facility and FICC - GSD general collateral financing repurchase agreement service. For each of these programs, the ability to borrow utilizing these sources is dependent on meeting the respective membership requirements. Our borrowing capacity in each program is a function of the collateral the Bank has posted with each counterparty, including any respective haircuts applied to that collateral.

As of September 30, 2025, we pledged loans and securities to the FHLB to secure a maximum borrowing capacity of $33.5 billion, of which $109 million was used. Our FHLB membership is supported by our investment in FHLB stock of $42 million and $18 million as of September 30, 2025 and December 31, 2024, respectively.

As of September 30, 2025, we pledged loans to secure a borrowing capacity of $45.6 billion under the Federal Reserve Discount Window. Our membership with the Federal Reserve is supported by our investment in Federal Reserve stock, which totaled $2.6 billion and $1.3 billion as of September 30, 2025 and December 31, 2024, respectively.

As a member of FICC - GSD, we have $21.5 billion of readily available borrowing capacity secured by securities from our investment portfolio as of September 30, 2025. Our FICC - GSD membership is supported by our investment in Depository Trust and Clearing Corporation common stock of $488 thousand and $412 thousand as of September 30, 2025 and December 31, 2024, respectively.

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Deposits

Table 28 provides a comparison of the average balances, interest expense and average deposits interest rates for the third quarter and first nine months of 2025 and 2024.

Table 28: Deposits Composition and Average Deposits Interest Rates

	Three Months Ended September 30,
	2025						2024
(Dollars in millions)	Average Balance		Interest Expense		Average Deposits Interest Rate		Average Balance		Interest Expense		Average Deposits Interest Rate
Interest-bearing checking accounts(1)	$	35,419	$	107	1.21	%	$	33,936	$	135	1.59	%
Saving deposits(2)	300,386		2,355		3.14		211,608		1,825		3.45
Time deposits	103,722		1,135		4.38		78,965		985		4.99
Total interest-bearing deposits	$	439,527	$	3,597	3.27		$	324,509	$	2,945	3.63

	Nine Months Ended September 30,
	2025						2024
(Dollars in millions)	Average Balance		Interest Expense		Average Deposits Interest Rate		Average Balance		Interest Expense		Average Deposits Interest Rate
Interest-bearing checking accounts(1)	$	35,824	$	334	1.24	%	$	34,829	$	421	1.61	%
Saving deposits(2)	264,862		6,187		3.11		209,030		5,299		3.38
Time deposits	87,855		2,911		4.42		77,997		2,911		4.98
Total interest-bearing deposits	$	388,541	$	9,432	3.24		$	321,856	$	8,631	3.58

__________

(1)Includes negotiable order of withdrawal accounts.

(2)Includes money market deposit accounts.

The FDIC limits the acceptance of brokered deposits to well-capitalized insured depository institutions and, with a waiver from the FDIC, to adequately-capitalized institutions. The Bank was well-capitalized, as defined under the federal banking regulatory guidelines, as of both September 30, 2025 and December 31, 2024. See “Part I—Item 1. Business—Supervision and Regulation” in our 2024 Form 10-K for additional information. We provide additional information on the composition of deposits in “Consolidated Balance Sheets Analysis—Table 7: Funding Sources Composition” and in “Part I—Item 1. Financial Statements—Note 8—Deposits and Borrowings.”

Funding

Our source of funding includes deposits, senior and subordinated notes, securitized debt obligations, federal funds purchased, securities loaned or sold under agreements to repurchase and FHLB advances secured by certain portions of our loan and securities portfolios. A key objective in our use of these markets is to maintain access to a diversified mix of wholesale funding sources. Insured deposits in our Consumer Banking business represent our primary source of funding, as they are a relatively stable and low cost source of funding. See “Consolidated Balance Sheets Analysis—Table 7: Funding Sources Composition” for additional information on our primary sources of funding.

In the normal course of business, we enter into various contractual obligations that may require future cash payments that affect our short-term and long-term liquidity and capital resource needs. Our future cash outflows primarily relate to deposits, borrowings and operating leases. The actual timing and amounts of future cash payments may vary over time due to a number of factors, such as early debt redemptions and changes in deposit balances.

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Short-Term Borrowings and Long-Term Debt

We access the capital markets to meet our funding needs through the issuance of senior and subordinated notes, securitized debt obligations and federal funds purchased and securities loaned or sold under agreements to repurchase. In addition, we have access to short-term and long-term FHLB advances secured by certain investment securities, multifamily real estate loans and commercial real estate loans.

Our short-term borrowings, which include those borrowings with an original contractual maturity of one year or less, typically consist of federal funds purchased, securities loaned or sold under agreements to repurchase or short-term FHLB advances, and do not include the current portion of long-term debt. Our short-term borrowings increased by $54 million to $616 million as of September 30, 2025 from December 31, 2024 driven by commercial-related repurchase agreements.

Our long-term funding, which primarily consists of securitized debt obligations and senior and subordinated notes, increased by $5.9 billion to $50.9 billion as of September 30, 2025 from December 31, 2024 primarily driven by borrowings assumed from the Transaction. We provide more information on our securitization activity in “Part I—Item 1. Financial Statements—Note 6—Variable Interest Entities and Securitizations” and on our borrowings in “Part I—Item 1. Financial Statements—Note 8—Deposits and Borrowings.”

The following table summarizes issuances of securitized debt obligations, senior and subordinated notes, long-term FHLB advances and their respective maturities or redemptions for the third quarter and first nine months of 2025 and 2024.

Table 29: Long-Term Debt Funding Activities

	Issuances				Maturities/Redemptions
	Three Months Ended September 30,				Three Months Ended September 30,
(Dollars in millions)	2025		2024		2025		2024
Securitized debt obligations	$	1,500	$	1,000	$	2,536	$	2,622
Senior and subordinated notes	2,750		2,000		2,860		—
FHLB advances	—		—		—		—
Total	$	4,250	$	3,000	$	5,396	$	2,622

	Issuances(1)				Maturities/Redemptions
	Nine Months Ended September 30,				Nine Months Ended September 30,
(Dollars in millions)	2025		2024		2025		2024
Securitized debt obligations	$	7,350	$	1,000	$	8,097	$	3,434
Senior and subordinated notes	11,283		4,000		6,307		2,911
FHLB advances	523		—		—		—
Total	$	19,156	$	5,000	$	14,404	$	6,345

__________

(1)Issuances for the first nine months of 2025 includes $13.2 billion of debt assumed in the Transaction.

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Credit Ratings

Our credit ratings impact our ability to access capital markets and our borrowing costs. For more information, see “Part II—Item 1A. Risk Factors” under the heading in our Q2 2025 Form 10-Q “A downgrade in our credit ratings could significantly impact our liquidity, funding costs and access to the capital markets.”

Table 30 provides a summary of the credit ratings for the senior unsecured long-term debt of Capital One Financial Corporation and CONA as of September 30, 2025 and December 31, 2024.

Table 30: Senior Unsecured Long-Term Debt Credit Ratings

	September 30, 2025		December 31, 2024
	Capital One Financial Corporation	CONA	Capital One Financial Corporation	CONA
Moody’s	Baa1	A3	Baa1	A3
S&P	BBB	BBB+	BBB	BBB+
Fitch	A-	A	A-	A

As of October 20, 2025, Standard & Poor’s (“S&P”), Fitch Ratings (“Fitch”), and Moody’s Investors Service (“Moody’s”) have our credit ratings on a stable outlook.

Other Commitments

In the normal course of business, we enter into other contractual obligations that may require future cash payments that affect our short-term and long-term liquidity and capital resource needs. Our other contractual obligations include lending commitments, leases, purchase obligations and other contractual arrangements.

As of September 30, 2025 and December 31, 2024, our total unfunded lending commitments were $723.8 billion and $458.1 billion, respectively, consisting of credit card lines, loan commitments to customers of both our Commercial Banking and Consumer Banking businesses, as well as standby and commercial letters of credit. We generally manage the potential risk of unfunded lending commitments by limiting the total amount of arrangements, monitoring the size and maturity structure of these portfolios and applying the same credit standards for all of our credit activities. For additional information, refer to “Part I—Item 1. Financial Statements—Note 14—Commitments, Contingencies, Guarantees and Others” in this Report.

Our primary involvement with leases is in the capacity as a lessee where we lease premises to support our business. The majority of our leases are operating leases of office space, retail bank branches and cafés. Our operating leases expire at various dates through 2071, although some have extension or termination options, and we assess the likelihood of exercising such options. If it is reasonably certain that we will exercise the options, then we include the impact in the measurement of our right-of-use assets and lease liabilities. As of both September 30, 2025 and December 31, 2024, we had $1.5 billion in aggregate operating lease obligations. We provide more information on our lease activity in “Part II—Item 8. Financial Statements and Supplementary Data—Note 8—Premises, Equipment and Leases” in our 2024 Form 10-K.

We have enforceable and legally binding purchase obligations for goods and services such as data management, media and other software and third-party services. As of September 30, 2025 and December 31, 2024, we had $3.7 billion and $4.0 billion, respectively, in aggregate purchase obligations.

We also enter into various contractual arrangements that may require future cash payments, including short-term obligations such as trade payables, commitments to fund certain equity investments, obligations for pension and post-retirement benefit plans, and representation and warranty reserves. These arrangements are discussed in more detail in “Part I—Item 1. Financial Statements—Note 6—Variable Interest Entities and Securitizations,” and “Part I—Item 1. Financial Statements—Note 14—Commitments, Contingencies, Guarantees and Others” in this Report and “Part II—Item 8. Financial Statements and Supplementary Data—Note 15—Employee Benefit Plans” in our 2024 Form 10-K.

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MARKET RISK PROFILE

Our primary market risk exposures include interest rate risk, foreign exchange risk and commodity pricing risk. We are exposed to market risk primarily from the following operations and activities:

•Traditional banking activities of deposit gathering and lending;

•Asset/liability management activities including the management of investment securities, short-term and long-term borrowings and derivatives;

•Foreign operations within our Credit Card and Consumer Banking businesses; and

•Customer accommodation activities within our Commercial Banking business.

We have enterprise-wide risk management policies and limits, approved by our Board of Directors, which govern our market risk management activities. Our objective is to manage our exposure to market risk in accordance with these policies and limits based on prevailing market conditions and long-term expectations. We provide additional information below about our primary sources of market risk, our market risk management strategies and the measures that we use to evaluate these exposures.

Interest Rate Risk

Interest rate risk represents exposure to financial instruments whose values vary with the level or volatility of interest rates. We are exposed to interest rate risk primarily from the differences in the timing between the maturities or repricing of assets and liabilities. We manage our interest rate risk primarily by entering into interest rate swaps and other derivative instruments which could include caps, floors, options, futures and forward contracts.

We use various industry standard market risk measurement techniques and analyses to measure, assess and manage the impact of changes in interest rates on our net interest income and our economic value of equity and changes in foreign exchange rates on our non-dollar-denominated funding and non-dollar equity investments in foreign operations.

As of June 30, 2025, we integrated the acquired assets and assumed liabilities of Discover that are part of our continuing operations into our interest rate risk framework. The Transaction, and subsequent business actions, have resulted in modest impacts to both our net interest income and economic value of equity sensitivities.

Net Interest Income Sensitivity

Our net interest income sensitivity measure estimates the impact of hypothetical instantaneous movements in interest rates relative to our baseline interest rate forecast on our projected 12-month net interest income. Net interest income sensitivity metrics are derived using the following key assumptions:

•As of September 30, 2025, our metrics assume a market implied baseline interest rate projection for the upper limit of the Federal Funds Target Rate of 3.75% and 3.25% at December 31, 2025 and 2026, respectively.

•In addition to our existing assets, liabilities and derivative positions, we incorporate expected future business growth assumptions. These assumptions include loan and deposit growth, pricing, plans for projected changes in our funding mix and our securities and cash position from our internal corporate outlook that is used in our financial planning process.

•The analysis assumes this forecast of expected future business growth remains unchanged between the baseline rate forecast and rate shock scenarios, including no changes to our interest rate risk management activities like securities and hedging actions.

•We incorporate the dynamic nature of deposit re-pricing, which includes pricing lags and changes in deposit beta and mix as interest rates change, and the prepayment sensitivity of our mortgage securities to the level of interest rates. In our models, deposit betas and mortgage security prepayments vary dynamically based on the level of interest rates and by product type. In the contexts used in this section, “beta” refers to the change in deposit rate paid relative to the change in the federal funds rate.

•In instances where an interest rate scenario would result in a rate less than 0%, we assume a rate of 0% for that

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scenario. This assumption applies only to jurisdictions that do not have a practice of employing negative policy rates. In jurisdictions that have negative policy rates, we do not floor interest rates at 0%.

At the current level of interest rates, our projected 12-month net interest income is expected to increase in higher rate scenarios and decrease in lower rate scenarios. The decrease in lower rate scenarios is driven by lower interest income from our assets, including floating rate credit card and commercial loans, being partially offset by lower interest expense from our deposits and other liabilities, net of our interest rate hedges.

Our combined 12-month net interest income sensitivity increased modestly as compared to December 31, 2024, driven largely by the Transaction. Discover’s assets had a large concentration of floating rate Credit Card balances, and we terminated Discover’s interest rate swaps in cash flow hedging relationships as they no longer met the conditions of a qualifying accounting hedge at the Closing Date.

Economic Value of Equity Sensitivity

Our economic value of equity sensitivity measure estimates the impact of hypothetical instantaneous movements in interest rates on the net present value of our assets and liabilities, including derivative exposures. Economic value of equity sensitivity metrics are derived using the following key assumptions:

•As of September 30, 2025, our metrics assume a market implied baseline interest rate projection for the upper limit of the Federal Funds Target Rate of 3.75% and 3.25% at December 31, 2025 and 2026, respectively.

•The analysis includes only existing assets, liabilities and derivative positions and does not incorporate business growth assumptions or projected balance sheet changes.

•Similar to our net interest income sensitivity measure, we incorporate the dynamic nature of deposit repricing and attrition, which includes pricing lags and changes in deposit beta as interest rates change and the prepayment sensitivity of our mortgage securities to the level of interest rates. In our models, deposit betas and mortgage security prepayments vary dynamically based on the level of interest rates and by product type.

•Balance attrition assumptions for loans, including credit card, personal, auto, and commercial loans, remain unchanged between the baseline interest rate forecast and interest rate shock scenarios as the majority of these loans are floating rate or shorter duration fixed rate loans and hence paydowns have a low sensitivity to the level of interest rates.

•For assets and liabilities with embedded optionality, such as mortgage securities and deposit balances, we utilize Monte Carlo simulations to assess economic value with industry-standard term structure modeling of interest rates.

•Our calculations of net present value apply appropriate spreads over the benchmark yield curve for select assets and liabilities to capture the inherent risks (including credit risk) to discount expected interest and principal cash flows.

•In instances where an interest rate scenario would result in a rate less than 0%, we assume a rate of 0% for that scenario. This assumption applies only to jurisdictions that do not have a practice of employing negative policy rates. In jurisdictions that have negative policy rates, we do not floor interest rates at 0%.

Our current economic value of equity sensitivity profile demonstrates that our economic value of equity decreases in higher interest rate scenarios and increases in lower interest rate scenarios. The decrease in higher rate scenarios is due to the declines in the projected value of our fixed rate assets being only partially offset by corresponding movements in the projected value of our deposits and other liabilities. The pace of economic value of equity decrease is larger for the +200 bps scenario as our deposits are assumed to reprice more rapidly in higher interest rate environments.

Our combined economic value of equity sensitivity decreased as compared to December 31, 2024, driven largely by the Transaction. Discover’s assets had a large concentration of short duration, floating rate Credit Card balances and we terminated Discover’s existing interest rate swaps in cash flow hedging relationships as they no longer met the conditions of a qualifying accounting hedge at the Closing Date.

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Table 31 shows the estimated percentage impact on our projected baseline net interest income and our current economic value of equity calculated under the methodology described above as of September 30, 2025 and December 31, 2024.

Table 31: Interest Rate Sensitivity Analysis

	September 30, 2025		December 31, 2024
Estimated impact on projected baseline net interest income:
+200 basis points	1.7	%	1.3	%
+100 basis points	0.9		0.8
+50 basis points	0.5		0.4
–50 basis points	(0.5)		(0.4)
–100 basis points	(1.0)		(0.8)
–200 basis points	(2.6)		(1.9)
Estimated impact on economic value of equity:
+200 basis points	(4.1)		(6.3)
+100 basis points	(1.8)		(3.0)
+50 basis points	(0.9)		(1.4)
–50 basis points	0.7		1.3
–100 basis points	1.1		2.5
–200 basis points	0.7		3.9

In addition to these industry standard measures, we also consider the potential impact of alternative interest rate scenarios, such as larger rate shocks, higher than +/- 200 bps, as well as steepening and flattening yield curve scenarios in our internal interest rate risk management decisions. We also regularly review the sensitivity of our interest rate risk metrics to changes in our key modeling assumptions, such as our loan and deposit balance forecasts, mortgage prepayments and deposit repricing.

Limitations of Market Risk Measures

The interest rate risk models that we use in deriving these measures incorporate contractual information, internally-developed assumptions and proprietary modeling methodologies, which project borrower and depositor behavior patterns in certain interest rate environments. Other market inputs, such as interest rates, market prices and interest rate volatility, are also critical components of our interest rate risk measures. We regularly evaluate, update and enhance these assumptions, models and analytical tools as we believe appropriate to reflect our best assessment of the market environment and the expected behavior patterns of our existing assets and liabilities.

There are inherent limitations in any methodology used to estimate the exposure to changes in market interest rates. The sensitivity analysis described above contemplates only certain movements in interest rates and is performed at a particular point in time based on our existing balance sheet and, in some cases, expected future business growth and funding mix assumptions. The strategic actions that management may take to manage our balance sheet may differ significantly from our projections, which could cause our actual earnings and economic value of equity sensitivities to differ substantially from the above sensitivity analysis.

For further information on our interest rate exposures, see “Part I—Item 1. Financial Statements—Note 9—Derivative Instruments and Hedging Activities.”

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Foreign Exchange Risk

Foreign exchange risk represents exposure to changes in the values of current holdings and future cash flows denominated in other currencies. We are exposed to foreign exchange risk primarily from the intercompany funding denominated in pound sterling (“GBP”) and the Canadian dollar (“CAD”) that we provide to our businesses in the U.K. and Canada and net equity investments in those businesses. We are also exposed to foreign exchange risk due to changes in the dollar-denominated value of future earnings and cash flows from our foreign operations and from our Euro (“EUR”)-denominated borrowings.

Our non-dollar denominated intercompany funding and EUR-denominated borrowings expose our earnings to foreign exchange transaction risk. We manage these transaction risks by using forward foreign currency derivatives and cross-currency swaps to hedge our exposures. We measure our foreign exchange transaction risk exposures by applying a 1% U.S. dollar appreciation shock against the value of the non-dollar denominated intercompany funding and EUR-denominated borrowings and their related hedges, which shows the impact to our earnings from foreign exchange risk. Our nominal intercompany funding outstanding was 1.4 billion GBP and 1.3 billion GBP as of September 30, 2025 and December 31, 2024, respectively, and 1.1 billion CAD and 1.4 billion CAD as of September 30, 2025 and December 31, 2024, respectively. Our nominal EUR-denominated borrowings outstanding were 503 million EUR and 505 million EUR as of September 30, 2025 and December 31, 2024, respectively.

Certain non-dollar equity investments in foreign operations expose our balance sheet and capital ratios to translation risk in AOCI. We manage our translation risk by entering into foreign currency derivatives designated as net investment hedges. We measure these exposures by applying a 30% U.S. dollar appreciation shock, which we believe approximates a significant adverse shock over a one-year time horizon, against the value of the equity invested in our foreign operations net of related net investment hedges where applicable. Our gross equity exposures in our U.K. and Canadian operations were 2.3 billion GBP and 2.2 billion GBP as of September 30, 2025 and December 31, 2024, respectively, and 2.8 billion CAD and 2.6 billion CAD as of September 30, 2025 and December 31, 2024, respectively.

As a result of our derivative management activities, we believe our net exposure to foreign exchange risk is minimal. For more information, see “Part I—Item 1. Financial Statements—Note 9—Derivative Instruments and Hedging Activities” and “Part I—Item 1. Financial Statements—Note 10—Stockholders’ Equity.”

Risk Related to Customer Accommodation Derivatives

We offer interest rate, commodity and foreign currency derivatives as an accommodation to our customers within our Commercial Banking business. We offset the majority of the market risk of these customer accommodation derivatives by entering into offsetting derivatives transactions with other counterparties. We use value-at-risk (“VaR”) as the primary method to measure the market risk in our customer accommodation derivative activities on a daily basis. VaR is a statistical risk measure used to estimate the potential loss from movements observed in the recent market environment. We employ a historical simulation approach using the most recent 500 business days and use a 99% confidence level and a holding period of one business day. As a result of offsetting our customer exposures with other counterparties, we believe that our net exposure to market risk in our customer accommodation derivatives is minimal. For further information on our risk related to customer accommodation derivatives, see “Part I—Item 1. Financial Statements—Note 9—Derivative Instruments and Hedging Activities.”

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SUPERVISION AND REGULATION

We provide information on our Supervision and Regulation in our 2024 Form 10-K under “Part I—Item 1. Business—Supervision and Regulation” and in our Quarterly Reports on Form 10-Q for the period ended March 31, 2025 and June 30, 2025 under “Part I—Item 2. MD&A—Supervision and Regulation.”

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FORWARD-LOOKING STATEMENTS

From time to time, we have made and will make forward-looking statements, including those that discuss, among other things: strategies, goals, outlook or other non-historical matters; projections, revenues, income, returns, expenses, assets, liabilities, capital and liquidity measures, capital allocation plans, accruals for claims in litigation and for other claims against us; earnings per share, efficiency ratio, operating efficiency ratio or other financial measures for us; future financial and operating results; our plans, objectives, expectations and intentions; and the assumptions that underlie these matters.

To the extent that any such information is forward-looking, it is intended to fit within the safe harbor for forward-looking information provided by the Private Securities Litigation Reform Act of 1995.

Forward-looking statements often use words such as “will,” “anticipate,” “target,” “expect,” “think,” “estimate,” “intend,” “plan,” “goal,” “believe,” “forecast,” “outlook” or other words of similar meaning. Any forward-looking statements made by us or on our behalf speak only as of the date they are made or as of the date indicated, and we do not undertake any obligation to update forward-looking statements as a result of new information, future events or otherwise. For additional information on factors that could materially influence forward-looking statements included in this Report, see the risk factors set forth under “Part II—Item 1A. Risk Factors” in the Q2 2025 Form 10-Q. You should carefully consider the factors discussed below, and in our Risk Factors or other disclosures, in evaluating these forward-looking statements.

Numerous factors could cause our actual results to differ materially from those described in such forward-looking statements, including, among other things:

•risks related to the integration of the Transaction, including our ability to successfully integrate our businesses, incur substantial expenses related to the Transaction and to the integration of Discover, and the expenses may be greater than anticipated due to factors, some or all of which may be outside our control; our ability to realize all of the anticipated benefits of the Transaction, or those benefits may take longer to realize than expected due to factors that may be outside our control; the integration of Discover may have an adverse effect on our business and results of operations due to the diversion of a substantial portion of the time and attention of our management team; potential employee attrition; and other factors that may affect our future results;

•changes and instability in the macroeconomic environment, resulting from factors that include, but are not limited to monetary, fiscal and trade policy actions such as tariffs, geopolitical conflicts or instability, such as the war between Ukraine and Russia and the conflict in the Middle East, labor shortages, government shutdowns, inflation and deflation, potential recessions, technology-driven disruption of certain industries, lower demand for credit, changes in deposit practices and payment patterns;

•fluctuations in interest rates;

•our ability to maintain adequate sources of funding and liquidity to operate our business;

•increases in credit losses and delinquencies and the impact of incorrectly estimated expected losses, which could result in inadequate reserves;

•our ability to maintain adequate capital or liquidity levels or to comply with revised capital or liquidity requirements, which could have a negative impact on our financial results and our ability to return capital to our stockholders;

•limitations on our ability to receive dividends from our subsidiaries;

•a downgrade in our credit ratings;

•our ability to develop, operate, and adapt our operational, technology and organizational infrastructure suitable for the nature of our business;

•increased costs, reductions in revenue, reputational damage, legal exposure and business disruptions that can result from a cyber-attack or other security incident on us or third parties (including their supply chains) with which we conduct business, including an incident that results in the theft, loss, manipulation or misuse of information, or the disabling of systems and access to information critical to business operations;

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•the use, reliability, and accuracy of the models, artificial intelligence (“AI”), and data on which we rely;

•our ability to manage fraudulent activity risks;

•compliance with new and existing domestic and foreign laws, regulations and regulatory expectations, which may change over time including as a result of the political and policy goals of elected officials;

•compliance with applicable laws and regulations related to privacy, data protection and data security, in addition to compliance with our own privacy policies and contractual obligations to third parties;

•developments, changes or actions relating to any litigation, governmental investigation or regulatory enforcement action or matter involving us;

•the amount and rate of deposit growth and changes in deposit costs;

•our ability to execute on our strategic initiatives and operational plans;

•our response to competitive pressures;

•change in market preference towards other operators of payment networks and alternative payment providers;

•our ability to create and maintain a strong base of network licensees and achieving meaningful global card acceptance;

•legislation, regulation and merchants’ efforts to reduce the interchange fees charged by credit and debit card networks to facilitate card transactions, and by legislation and regulation impacting such fees;

•the number of large merchants that accept cards on our recently acquired Discover Network or PULSE Network;

•merchant defaults;

•our ability to invest successfully in and introduce digital and other technological developments across all our businesses;

•our success in integrating acquired businesses and loan portfolios, and our ability to realize anticipated benefits from announced transactions and strategic partnerships;

•changes in the reputation of, or expectations regarding, us or the financial services industry with respect to practices, products, services or financial condition;

•the success of our marketing efforts in attracting and retaining customers;

•our risk management strategies;

•our ability to protect our intellectual property rights;

•our ability to attract, develop, retain and motivate key senior leaders and skilled employees;

•our ability to manage risks from catastrophic events;

•climate change manifesting as physical or transition risks;

•our assumptions or estimates in our financial statements;

•the soundness of other financial institutions and other third parties, actual or perceived; and

•other risk factors identified from time to time in our public disclosures, including in the reports that we file with the SEC.

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SUPPLEMENTAL TABLE

Reconciliation of Non-GAAP Measures

The following non-GAAP measure consists of our adjusted results that we believe helps investors and users of our financial information understand the effect of adjusting items on our selected reported results; however, it may not be comparable to similarly-titled measures reported by other companies. This adjusted result provides alternate measurements of our operating performance, both for the current period and trends across multiple periods. The following table presents reconciliations of the non-GAAP measure to the applicable amounts measured in accordance with U.S. GAAP. The non-GAAP measure below should not be viewed as a substitute for reported results determined in accordance with U.S. GAAP.

Table A—Reconciliation of Non-GAAP Measures

	Three Months Ended September 30,						Nine Months Ended September 30,
(Dollars in millions, except as noted)	2025			2024			2025			2024
Adjusted operating efficiency ratio:
Operating expense (U.S. GAAP)	$	6,860		$	4,201		$	17,206		$	12,210
Discover integration expenses	(348)			(63)			(757)			(94)
Discover intangible amortization expense	(498)			—			(753)			—
Legal reserve activities	—			—			(239)			—
FDIC special assessment	—			9			—			(41)
Adjusted operating expense (non-GAAP)	$	6,014		$	4,147		$	15,457		$	12,075
Total net revenue (U.S. GAAP)	$	15,359		$	10,014		$	37,851		$	28,922
Discover loan and deposit fair value mark amortization	105			—			190			—
Walmart program agreement termination contra revenue impact	—			—			—			27
Adjusted net revenue (non-GAAP)	$	15,464		$	10,014		$	38,041		$	28,949
Operating efficiency ratio (U.S. GAAP)	44.66%			41.95%			45.46%			42.22%
Impact of adjustments noted above	(577)		bps	(54)		bps	(482)		bps	(51)		bps
Adjusted operating efficiency ratio (non-GAAP)	38.89%			41.41%			40.63%			41.71%

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 these 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 table presents reconciliations of these non-GAAP measures to the applicable amounts measured in accordance with U.S. GAAP. These non-GAAP measures should not be viewed as a substitute for reported results determined in accordance with U.S. GAAP.

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	Three Months Ended September 30,				Nine Months Ended September 30,
(Dollars in millions, except as noted)	2025		2024		2025		2024
TCE (Average):
Stockholders’ equity	$	112,819	$	61,289	$	87,511	$	59,139
Goodwill and other intangible assets(1)	(41,815)		(15,225)		(28,790)		(15,251)
Noncumulative perpetual preferred stock	(5,407)		(4,845)		(5,204)		(4,845)
TCE	$	65,597	$	41,219	$	53,517	$	39,043
Return on TCE (Average):
Net income available to common stockholders (excluding discontinued operations)	$	3,087	$	1,692	$	132	$	3,423
TCE (Average)	65,597		41,219		53,517		39,043
Return on TCE(2)	18.82%		16.42%		0.33%		11.69%
Tangible Assets (Average):
Total assets	$	657,858	$	481,219	$	574,602	$	477,816
Goodwill and other intangible assets(1)	(41,815)		(15,225)		(28,790)		(15,251)
Tangible assets	$	616,043	$	465,994	$	545,812	$	462,565
Return on Tangible Assets (Average):
Net income	$	3,192	$	1,777	$	319	$	3,654
Tangible assets (Average)	616,043		465,994		545,812		462,565
Return on tangible assets(3)	2.07%		1.53%		0.08%		1.05%

(Dollars in millions, except as noted)	September 30, 2025		September 30, 2024		December 31, 2024
TCE (Period-End):
Stockholders’ equity	$	113,813	$	62,925	$	60,784
Goodwill and other intangible assets(1)	(41,537)		(15,214)		(15,157)
Noncumulative perpetual preferred stock	(5,407)		(4,845)		(4,845)
TCE	$	66,869	$	42,866	$	40,782
Tangible Assets (Period-End):
Total assets	$	661,877	$	486,433	$	490,144
Goodwill and other intangible assets(1)	(41,537)		(15,214)		(15,157)
Tangible assets	$	620,340	$	471,219	$	474,987
Tangible Book Value per Common Share:
TCE (Period-end)	$	66,869	$	42,866	$	40,782
Outstanding Common Shares	635.7		381.5		381.2
Tangible book value per common share(4)	$	105.18	$	112.36	$	106.97
TCE Ratio
TCE (Period-end)	$	66,869	$	42,866	$	40,782
Tangible Assets (Period-end)	620,340		471,219		474,987
TCE Ratio(5)	10.8%		9.1%		8.6%

__________

(1)Includes impact of related deferred taxes.

(2)Return on average TCE is a non-GAAP measure calculated based on annualized net income (loss) available to common stockholders less annualized income (loss) from discontinued operations, net of tax, for the period, divided by average TCE.

(3)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.

(4)Tangible book value per common share is a non-GAAP measure calculated based on TCE divided by common shares outstanding.

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

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Glossary and Acronyms

2019 Cybersecurity Incident: The unauthorized access by an outside individual who obtained certain types of personal information relating to people who had applied for our credit card products and to our credit card customers that we announced on July 29, 2019.

2022 Call Report: Consolidated Reports of Condition and Income, (FFIEC 031) as of December 31, 2022.

Allowance coverage ratio: Allowance for credit losses as a percentage of loans held for investment.

Amortized cost: The amount at which a financing receivable or investment is originated or acquired, adjusted for applicable accrued interest, accretion, or amortization of premium, discount, and net deferred fees or costs, collection of cash, write-offs, foreign exchange and fair value hedge accounting adjustments.

Annual Report: References to our “2024 Form 10-K” are to our Annual Report on Form 10-K for the fiscal year ended December 31, 2024.

Bank: CONA, Capital One Financial Corporation’s principal operating subsidiary.

Basel Committee: The Basel Committee on Banking Supervision.

Basel III Capital Rules: The regulatory capital requirements established by the Federal Banking Agencies in July 2013 to implement the Basel III capital framework developed by the Basel Committee as well as certain Dodd-Frank Act and other capital provisions.

Basel III Finalization Proposal: The notice of proposed rulemaking released by the Federal Banking Agencies on July 27, 2023 to revise the Basel III Capital Rules applicable to banking organizations with total assets of $100 billion or more and their subsidiary depository institutions.

Basel III standardized approach: The Basel III Capital Rules modified Basel I to create the Basel III standardized approach.

Capital One or the Company: Capital One Financial Corporation and its subsidiaries.

Card Product Misclassification: Discover’s incorrect classification of certain credit card accounts into its highest merchant and merchant acquirer pricing tier.

Carrying value (with respect to loans): The amount at which a loan is recorded on the consolidated balance sheets. For loans recorded at amortized cost, carrying value is the unpaid principal balance net of unamortized deferred loan origination fees and costs, and unamortized purchase premium or discount. For loans that are or have been on nonaccrual status, the carrying value is also reduced by any net charge-offs that have been recorded and the amount of interest payments applied as a reduction of principal under the cost recovery method. For credit card loans, the carrying value also includes interest that has been billed to the customer, net of any related reserves. Loans held for sale are recorded at either fair value (if we elect the fair value option) or at the lower of cost or fair value.

CECL: In June 2016, the Financial Accounting Standards Board (“FASB”) issued Accounting Standards Update (“ASU”) No. 2016-13, Financial Instruments—Credit Losses (Topic 326): Measurement of Credit Losses on Financial Instruments. This ASU requires an impairment model (known as the CECL model) that is based on expected rather than incurred losses, with an anticipated result of more timely loss recognition. This guidance was effective for us on January 1, 2020.

CECL Transition Rule: A rule adopted by the Federal Banking Agencies and effective in 2020 that provides banking institutions an optional five-year transition period to phase in the impact of the CECL standard on their regulatory capital.

Closing Date: The Transaction was completed on May 18, 2025.

Common equity Tier 1 (“CET1”) capital: CET1 capital primarily includes qualifying common shareholders’ equity, retained earnings and certain AOCI amounts less certain deductions for goodwill, intangible assets, and certain deferred tax assets.

CONA: Capital One, National Association, one of our wholly-owned subsidiaries, which offers a broad spectrum of banking products and financial services to consumers, small businesses and commercial clients.

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CONA Bank Merger: The merger of Discover Bank into CONA with CONA as the surviving entity.

Credit risk: The risk to current or projected financial condition and resilience arising from an obligor’s failure to meet the terms of any contract with the Company or otherwise perform as agreed.

Deposit Insurance Fund (“DIF”): A fund maintained by the FDIC to provide insurance coverage for certain deposits. It is funded through assessments on banks.

Derivative: A contract or agreement whose value is derived from changes in interest rates, foreign exchange rates, prices of securities or commodities, credit worthiness for credit default swaps or financial or commodity indices.

Diners Club: Diners Club International, a global payments network of licensees, which are generally financial institutions, that issue Diners Club branded charge cards and/or provide card acceptance services.

Discontinued operations: The operating results of a component of an entity, as defined by Accounting Standards Codification 205, that are removed from continuing operations when that component has been disposed of or it is management’s intention to sell the component.

Discover: Discover Financial Services, a Delaware corporation.

Discover Network: The network which processes transactions for Discover-branded credit and debit cards and provides payment transaction processing and settlement services.

Dodd-Frank Wall Street Reform and Consumer Protection Act of 2010 (“Dodd-Frank Act”): Regulatory reform legislation signed into law on July 21, 2010. This law broadly affects the financial services industry and contains numerous provisions aimed at strengthening the sound operation of the financial services sector.

Exchange Act: The Securities Exchange Act of 1934, as amended.

eXtensible Business Reporting Language (“XBRL”): A language for the electronic communication of business and financial data.

Federal Banking Agencies: The Federal Reserve, Office of the Comptroller of the Currency and Federal Deposit Insurance Corporation.

Federal Deposit Insurance Corporation (“FDIC”): An independent U.S. governmental agency that administers the Deposit Insurance Fund.

Federal Reserve: The Board of Governors of the Federal Reserve System.

FICO score: A measure of consumer credit risk provided by credit bureaus, typically produced from statistical modeling software created by FICO (formerly known as “Fair Isaac Corporation”) utilizing data collected by the credit bureaus.

Financial difficulty modification (“FDM”): A FDM is deemed to occur when a loan modification is made to a borrower experiencing financial difficulty in the form of principal forgiveness, an interest rate reduction, an other-than-insignificant payment delay, a term extension, or a combination of these modifications in the current reporting period.

Foreign exchange contracts: Contracts that provide for the future receipt or delivery of foreign currency at previously agreed-upon terms.

Framework: The Capital One enterprise-wide risk management framework.

Global Payment Network: The Discover Network, PULSE Network, Diners Club International, and Network Partners, collectively.

GSE or Agency: A government-sponsored enterprise or agency is a financial services corporation created by the United States Congress. Examples of U.S. government agencies include Federal National Mortgage Association (“Fannie Mae”), Federal Home Loan Mortgage Corporation (“Freddie Mac”), Government National Mortgage Association (“Ginnie Mae”) and the Federal Home Loan Bank (“FHLB”).

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Globally Systematically Important Bank Surcharge (“G-SIB Surcharge”): The capital buffer imposed on U.S. banking organizations designated as global systematically important banks (“G-SIBs”) under the Federal Reserve’s capital framework. The surcharge increases a G-SIB’s minimum Common Tier Equity 1 (CET1) capital requirement based on its systematic risk score, which considers factors such as size, interconnectedness, complexity, cross-jurisdictional activity, and sustainability.

Interest rate sensitivity: The exposure to interest rate movements.

Interest rate swaps: Contracts in which a series of interest rate flows in a single currency are exchanged over a prescribed period. Interest rate swaps are the most common type of derivative contract that we use in our asset/liability management activities.

Investment grade: Represents a Moody’s long-term rating of Baa3 or better; and/or an S&P long-term rating of BBB- or better; and/or a Fitch long-term rating of BBB- or better; or if unrated, an equivalent rating using our internal risk ratings. Instruments that fall below these levels are considered to be non-investment grade.

Investor Entities: Entities that invest in community development entities (“CDE”) that provide debt financing to businesses and non-profit entities in low-income and rural communities.

LCR Rule: The final rules published by the Basel Committee and as implemented by the Federal Banking Agencies in 2014 for the Basel III Liquidity Coverage Ratio (“LCR”) in the United States. The LCR is calculated by dividing the amount of an institution’s high quality, unencumbered liquid assets by its estimated net cash outflow, as defined and calculated in accordance with the LCR Rule.

Leverage ratio: Tier 1 capital divided by average assets after certain adjustments, as defined by regulators.

Liquidity risk: The risk that the Company will not be able to meet its future financial obligations as they come due, or invest in future asset growth because of an inability to obtain funds at a reasonable price within a reasonable time.

Loan-to-value (“LTV”) ratio: The relationship, expressed as a percentage, between the principal amount of a loan and the appraised value of the collateral securing the loan.

Loss severity: Loss given default.

Managed presentation: A non-GAAP presentation of business segment results derived from our internal management accounting and reporting process, which employs various allocation methodologies, including funds transfer pricing, to assign certain balance sheet assets, deposits and other liabilities and their related revenues and expenses directly or indirectly attributable to each business segment. The results of our individual businesses reflect the manner in which management evaluates performance and makes decisions about funding our operations and allocating resources and are intended to reflect each segment as if it were a stand-alone business.

Market risk: The risk that an institution’s earnings or the economic value of equity could be adversely impacted by changes in interest rates, foreign exchange rates or other market factors.

Master netting agreement: An agreement between two counterparties that have multiple contracts with each other that provides for the net settlement of all contracts through a single payment in the event of default or termination of any one contract.

Measurement Period: The duration of time allowed after a merger closing date for fair value estimation of the related assets acquired and liabilities assumed.

Merger Agreement: Agreement and Plan of Merger, dated as of February 19, 2024, by and among Discover, Capital One and Merger Sub.

Merger: The merger of Merger Sub with and into Discover, with Discover as the surviving entity, pursuant to the Merger Agreement.

Merger Sub: Vega Merger Sub, Inc.

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Mortgage servicing rights (“MSRs”): The right to service a mortgage loan when the underlying loan is sold or securitized. Servicing includes collections of principal, interest and escrow payments from borrowers and accounting for and remitting principal and interest payments to investors.

Net charge-off rate: Represents (annualized) net charge-offs divided by average loans held for investment for the period. Negative net charge-offs and related rates are captioned as net recoveries.

Net interest margin: Represents (annualized) net interest income divided by average interest-earning assets for the period.

Network Partners: Financial institutions, financial technology firms, networks, network-to-network partners and other commercial service providers which we have agreements with for the provision of card issuing, payments processing and related services on the Global Payment Network.

Nonperforming loans: Generally include loans that have been placed on nonaccrual status. We do not report loans classified as held for sale as nonperforming.

NSFR Rule: The final rules published by the Basel Committee and as issued by the Federal Banking Agencies in October 2020 implementing the net stable funding ratio (“NSFR”) in the United States. The NSFR measures the stability of our funding profile and requires us to maintain minimum amounts of stable funding to support our assets, commitments and derivatives exposures over a one-year period.

Public Fund Deposits: Deposits that are derived from a variety of political subdivisions such as school districts and municipalities.

PULSE Network: The network which operates an electronic funds transfer network, providing financial institutions issuing debit cards on the PULSE Network with access to ATMs domestically and internationally, as well as merchant acceptance throughout the U.S. for debit card transactions.

Purchase volume: Consists of purchase transactions, net of returns, for the period, and excludes cash advance and balance transfer transactions.

Rating agency: An independent agency that assesses the credit quality and likelihood of default of an issue or issuer and assigns a rating to that issue or issuer.

Repurchase agreement: An instrument used to raise short-term funds whereby securities are sold with an agreement for the seller to buy back the securities at a later date.

Restructuring charges: Charges associated with the realignment of resources supporting various businesses, primarily consisting of severance and related benefits pursuant to our ongoing benefit programs and impairment of certain assets related to the business locations and/or activities being exited.

Risk-weighted assets: On- and off-balance sheet assets that are assigned to one of several broad risk categories and weighted by factors representing their risk and potential for default.

Second Step Merger: The merger of Discover with and into Capital One, with Capital One as the surviving entity.

Securitized debt obligations: A type of asset-backed security and structured credit product constructed from a portfolio of fixed-income assets.

Stress capital buffer requirement: A component of our standardized approach capital conservation buffer, which is recalibrated annually based on the results of our supervisory stress tests.

Stress Capital Buffer Rule: The final rule issued by the Federal Reserve in March 2020 to implement the stress capital buffer requirement.

Subprime: For purposes of lending in our Credit Card business, we generally consider FICO scores of 660 or below, or other equivalent risk scores, to be subprime. For purposes of auto lending in our Consumer Banking business, we generally consider FICO scores of 620 or below to be subprime.

73 Capital One Financial Corporation (COF)

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Tangible common equity (“TCE”): A non-GAAP financial measure calculated as common equity less goodwill and other intangible assets inclusive of any related deferred tax liabilities.

This Report: Quarterly Report on Form 10-Q for the period ended September 30, 2025.

Transaction: On May 18, 2025, we completed the acquisition of Discover in an all-stock transaction as outlined in the Merger Agreement dated February 19, 2024.

Unfunded lending commitments: Legally binding agreements to provide a defined level of financing until a specified future date.

U.S. GAAP: Accounting principles generally accepted in the United States of America. Accounting rules and conventions defining acceptable practices in preparing financial statements in the U.S.

Variable interest entity (“VIE”): An entity that, by design, either (i) lacks sufficient equity to permit the entity to finance its activities without additional subordinated financial support from other parties; or (ii) has equity investors that do not have (a) the ability to make significant decisions relating to the entity’s operations through voting rights, (b) the obligation to absorb the expected losses, and/or (c) the right to receive the residual returns of the entity.

74 Capital One Financial Corporation (COF)

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Acronyms

AI: Artificial Intelligence

AOCI: Accumulated other comprehensive income

ASC: Accounting Standards Codification

ASU: Accounting Standards Update

ATM: Automated teller machine

BHC: Bank holding company

bps: Basis points

CAD: Canadian dollar

CCP: Central Counterparty Clearinghouse, or Central Clearinghouse

CDE: Community development entities

CECL: Current expected credit loss

CEO: Chief Executive Officer

CET1: Common equity Tier 1 capital

CFO: Chief Financial Officer

CFPB: Consumer Financial Protection Bureau

CMBS: Commercial mortgage-backed securities

CME: Chicago Mercantile Exchange

CODM: Chief Operating Decision Maker

COEP: Capital One (Europe) plc

COF: Capital One Financial Corporation

COMET: Capital One Multi-asset Execution Trust

CONA: Capital One, National Association

COPAR: Capital One Prime Auto Receivables Trusts

CVA: Credit valuation adjustment

DCENT: Discover Card Execution Note Trust

DIF: Deposit Insurance Fund

DVA: Debit valuation adjustment

EUR: Euro

Fannie Mae: Federal National Mortgage Association

FASB: Financial Accounting Standards Board

FCM: Futures commission merchant

FDM: Financial difficulty modification

FDIC: Federal Deposit Insurance Corporation

FFIEC: Federal Financial Institutions Examination Council

FHLB: Federal Home Loan Bank

FICC - GSD: Fixed Income Clearing Corporation - Government Securities Division

FICC - MBSD: Fixed Income Clearing Corporation - Mortgage Backed Securities Division

FICO: Fair Isaac Corporation

Fitch: Fitch Ratings

Freddie Mac: Federal Home Loan Mortgage Corporation

GAAP: Generally accepted accounting principles in the U.S.

GBP: Pound sterling

Ginnie Mae: Government National Mortgage Association

75 Capital One Financial Corporation (COF)

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G-SIB: Global systemically important banks

GSE or Agency: Government-sponsored enterprise

ICE: Intercontinental Exchange

IRM: Independent Risk Management

LCH: LCH Group

LCR: Liquidity coverage ratio

LLC: Limited liability company

LTV: Loan-to-Value

Moody’s: Moody’s Investors Service

MSRs: Mortgage servicing rights

NSFR: Net stable funding ratio

OCC: Office of the Comptroller of the Currency

OCI: Other comprehensive income

OTC: Over-the-counter

PCA: Prompt corrective action

PCD: Purchase credit deteriorated

PPI: Payment protection insurance

RMBS: Residential mortgage-backed securities

S&P: Standard & Poor’s

SEC: U.S. Securities and Exchange Commission

SOFR: Secured Overnight Financing Rate

TCE: Tangible common equity

U.K.: United Kingdom

U.S.: United States of America

VaR: Value-At-Risk

VIE: Variable interest entity

76 Capital One Financial Corporation (COF)

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Item 1. Financial Statements
	Page
Consolidated Financial Statements	78
Consolidated Statements of Income	78
Consolidated Statements of Comprehensive Income	79
Consolidated Balance Sheets	80
Consolidated Statements of Changes in Stockholders’ Equity	81
Consolidated Statements of Cash Flows	83
Notes to Consolidated Financial Statements	85
Note 1—Summary of Significant Accounting Policies	85
Note 2—Business Combinations and Discontinued Operations	87
Note 3—Investment Securities	93
Note 4—Loans	96
Note 5—Allowance for Credit Losses and Reserve for Unfunded Lending Commitments	112
Note 6—Variable Interest Entities and Securitizations	117
Note 7—Goodwill and Other Intangible Assets	121
Note 8—Deposits and Borrowings	123
Note 9—Derivative Instruments and Hedging Activities	124
Note 10—Stockholders’ Equity	134
Note 11—Earnings Per Common Share	138
Note 12—Fair Value Measurement	139
Note 13—Business Segments and Revenue from Contracts with Customers	146
Note 14—Commitments, Contingencies, Guarantees and Others	150

77 Capital One Financial Corporation (COF)

CAPITAL ONE FINANCIAL CORPORATION

CONSOLIDATED STATEMENTS OF INCOME (UNAUDITED)

	Three Months Ended September 30,				Nine Months Ended September 30,
(Dollars in millions, except per share-related data)	2025		2024		2025		2024
Interest income:
Loans, including loans held for sale	$	15,229	$	10,547	$	37,835	$	30,460
Investment securities	823		733		2,377		2,120
Other	711		580		1,797		1,737
Total interest income	16,763		11,860		42,009		34,317
Interest expense:
Deposits	3,597		2,945		9,432		8,631
Securitized debt obligations	165		234		505		753
Senior and subordinated notes	582		596		1,622		1,793
Other borrowings	15		9		38		30
Total interest expense	4,359		3,784		11,597		11,207
Net interest income	12,404		8,076		30,412		23,110
Provision for credit losses	2,714		2,482		16,513		9,074
Net interest income after provision for credit losses	9,690		5,594		13,899		14,036
Non-interest income:
Discount and interchange fees, net	1,812		1,228		4,513		3,622
Service charges and other customer-related fees	849		501		2,016		1,422
Net securities loss	0		(35)		0		(35)
Other	294		244		910		803
Total non-interest income	2,955		1,938		7,439		5,812
Non-interest expense:
Salaries and associate benefits	3,496		2,391		9,041		7,069
Occupancy and equipment	856		587		2,208		1,692
Marketing	1,403		1,113		3,950		3,187
Professional services	641		402		1,731		980
Communications and data processing	476		358		1,288		1,064
Amortization of intangibles	514		20		801		58
Other	877		443		2,137		1,347
Total non-interest expense	8,263		5,314		21,156		15,397
Income from continuing operations before income taxes	4,382		2,218		182		4,451
Income tax provision (benefit)	1,189		441		(152)		797
Income from continuing operations, net of tax	3,193		1,777		334		3,654
Loss from discontinued operations, net of tax	(1)		0		(15)		0
Net income	3,192		1,777		319		3,654
Dividends and undistributed earnings allocated to participating securities	(33)		(28)		(13)		(60)
Preferred stock dividends	(73)		(57)		(195)		(171)
Discount on redeemed preferred stock	0		0		6		0
Net income available to common stockholders	$	3,086	$	1,692	$	117	$	3,423
Basic earnings per common share:
Net income from continuing operations	$	4.83	$	4.42	$	0.26	$	8.94
Net income (loss) from discontinued operations	0.00		0.00		(0.03)		0.00
Net income per basic common share	$	4.83	$	4.42	$	0.23	$	8.94
Diluted earnings per common share:
Net income from continuing operations	$	4.83	$	4.41	$	0.26	$	8.92
Net income (loss) from discontinued operations	0.00		0.00		(0.03)		0.00
Net income per diluted common share	$	4.83	$	4.41	$	0.23	$	8.92

    

See Notes to Consolidated Financial Statements.
	78	Capital One Financial Corporation (COF)

CAPITAL ONE FINANCIAL CORPORATION

CONSOLIDATED STATEMENTS OF COMPREHENSIVE INCOME (UNAUDITED)

	Three Months Ended September 30,				Nine Months Ended September 30,
(Dollars in millions)	2025		2024		2025		2024
Net income	$	3,192	$	1,777	$	319	$	3,654
Other comprehensive income (loss), net of tax:
Net unrealized gains on securities available for sale	769		2,300		2,094		1,272
Net unrealized gains on hedging relationships	149		1,069		1,211		677
Foreign currency translation adjustments	(16)		45		64		31
Other	0		0		0		1
Other comprehensive income, net of tax	902		3,414		3,369		1,981
Comprehensive income	$	4,094	$	5,191	$	3,688	$	5,635

    

See Notes to Consolidated Financial Statements.
	79	Capital One Financial Corporation (COF)

CAPITAL ONE FINANCIAL CORPORATION

CONSOLIDATED BALANCE SHEETS (UNAUDITED)

(Dollars in millions, except per share-related data)	September 30, 2025		December 31, 2024
Assets:
Cash and cash equivalents:
Cash and due from banks	$	4,606	$	3,028
Interest-bearing deposits and other short-term investments	50,673		40,202
Total cash and cash equivalents	55,279		43,230
Restricted cash for securitization investors	3,248		441
Securities available for sale (amortized cost of $96.9 billion and $93.0 billion and allowance for credit losses of $3 million and $4 million as of September 30, 2025 and December 31, 2024, respectively)	89,733		83,013
Loans held for investment:
Unsecuritized loans held for investment	389,808		298,241
Loans held in consolidated trusts	53,351		29,534
Total loans held for investment	443,159		327,775
Allowance for credit losses	(23,103)		(16,258)
Net loans held for investment	420,056		311,517
Loans held for sale ($620 million and $87 million carried at fair value as of September 30, 2025 and December 31, 2024, respectively)	670		202
Premises and equipment, net	5,576		4,511
Interest receivable	3,456		2,532
Goodwill	28,863		15,059
Other intangible assets	17,042		233
Other assets	29,957		29,406
Assets of discontinued operations	7,997		0
Total assets	$	661,877	$	490,144
Liabilities:
Interest payable	$	826	$	666
Deposits:
Non-interest-bearing deposits	27,649		26,122
Interest-bearing deposits	441,136		336,585
Total deposits	468,785		362,707
Securitized debt obligations	13,642		14,264
Other debt:
Federal funds purchased and securities loaned or sold under agreements to repurchase	616		562
Senior and subordinated notes	36,662		30,696
Other borrowings	562		29
Total other debt	37,840		31,287
Other liabilities	26,941		20,436
Liabilities of discontinued operations	30		0
Total liabilities	548,064		429,360
Commitments, contingencies and guarantees (see Note 14)
Stockholders’ equity:
Preferred stock (par value $0.01 per share; 50,000,000 shares authorized; 4,980,700 and 4,975,000 shares issued and outstanding as of September 30, 2025 and December 31, 2024, respectively)	0		0
Common stock (par value $0.01 per share; 1,000,000,000 shares authorized; 707,690,438 and 702,224,674 shares issued as of September 30, 2025 and December 31, 2024, respectively; 635,733,605 and 381,230,343 shares outstanding as of September 30, 2025 and December 31, 2024, respectively)	7		7
Additional paid-in capital, net	63,725		36,428
Retained earnings	63,624		64,505
Accumulated other comprehensive loss	(5,917)		(9,286)
Treasury stock, at cost (par value $0.01 per share; 71,956,833 and 320,994,331 shares as of September 30, 2025 and December 31, 2024, respectively)	(7,626)		(30,870)
Total stockholders’ equity	113,813		60,784
Total liabilities and stockholders’ equity	$	661,877	$	490,144

See Notes to Consolidated Financial Statements.
	80	Capital One Financial Corporation (COF)

CAPITAL ONE FINANCIAL CORPORATION

CONSOLIDATED STATEMENTS OF CHANGES IN STOCKHOLDERS’ EQUITY (UNAUDITED)

(Dollars in millions)	Preferred Stock			Common Stock			Additional Paid-In Capital		Retained Earnings		Accumulated Other Comprehensive Income (Loss)		Treasury Stock		Total Stockholders’ Equity
	Shares	Amount		Shares	Amount
Balance as of December 31, 2024	4,975,000	$	0	702,224,674	$	7	$	36,428	$	64,505	$	(9,286)	$	(30,870)	$	60,784
Comprehensive income									1,404		1,757				3,161
Dividends—common stock(1)				12,211	0		2		(236)						(234)
Dividends—preferred stock									(57)						(57)
Purchases of treasury stock													(375)		(375)
Issuances of common stock and restricted stock, net of forfeitures				3,572,356	0		93								93
Exercises of stock options				14,070	0		1								1
Compensation expense for restricted stock units							169								169
Balance as of March 31, 2025	4,975,000	$	0	705,823,311	$	7	$	36,693	$	65,616	$	(7,529)	$	(31,245)	$	63,542
Comprehensive income (loss)									(4,277)		710				(3,567)
Dividends—common stock(1)				2,163	0		0		(388)						(388)
Dividends—preferred stock									(65)						(65)
Purchases of treasury stock													(167)		(167)
Issuances of common stock and restricted stock, net of forfeitures				903,641	0		111								111
Reissuance of treasury stock related to the Transaction				0	0		25,763						24,823		50,586
Issuances of preferred stock related to the Transaction	10,700	0					1,068								1,068
Redemptions of preferred stock	(5,000)	0					(506)		6						(500)
Compensation expense for restricted stock units							214								214
Fair value of purchase consideration related to restricted stock units							122								122
Balance as of June 30, 2025	4,980,700	$	0	706,729,115	$	7	$	63,465	$	60,892	$	(6,819)	$	(6,589)	$	110,956
Comprehensive income									3,192		902				4,094
Dividends—common stock(1)				2,597	0		1		(387)						(386)
Dividends—preferred stock									(73)						(73)
Purchases of treasury stock													(1,037)		(1,037)
Issuances of common stock and restricted stock, net of forfeitures				958,726	0		91								91
Compensation expense for restricted stock units							168								168
Balance as of September 30, 2025	4,980,700	$	0	707,690,438	$	7	$	63,725	$	63,624	$	(5,917)	$	(7,626)	$	113,813

See Notes to Consolidated Financial Statements.
	81	Capital One Financial Corporation (COF)

CAPITAL ONE FINANCIAL CORPORATION

CONSOLIDATED STATEMENTS OF CHANGES IN STOCKHOLDERS’ EQUITY (UNAUDITED)

(Dollars in millions)	Preferred Stock			Common Stock			Additional Paid-In Capital		Retained Earnings		Accumulated Other Comprehensive Income (Loss)		Treasury Stock		Total Stockholders’ Equity
	Shares	Amount		Shares	Amount
Balance as of December 31, 2023	4,975,000	$	0	696,242,668	$	7	$	35,541	$	60,945	$	(8,268)	$	(30,136)	$	58,089
Cumulative effects of accounting standards adoption(2)									(25)						(25)
Comprehensive income (loss)									1,280		(1,266)				14
Dividends—common stock(1)				24,969	0		3		(238)						(235)
Dividends—preferred stock									(57)						(57)
Purchases of treasury stock													(249)		(249)
Issuances of common stock and restricted stock, net of forfeitures				3,470,983	0		80								80
Exercises of stock options				15,000	0		1								1
Compensation expense for restricted stock units							183								183
Balance as of March 31, 2024	4,975,000	$	0	699,753,620	$	7	$	35,808	$	61,905	$	(9,534)	$	(30,385)	$	57,801
Comprehensive income (loss)									597		(167)				430
Dividends—common stock(1)				8,354	0		2		(234)						(232)
Dividends—preferred stock									(57)						(57)
Purchases of treasury stock													(163)		(163)
Issuances of common stock and restricted stock, net of forfeitures				941,120	0		95								95
Compensation expense for restricted stock units							107								107
Balance as of June 30, 2024	4,975,000	$	0	700,703,094	$	7	$	36,012	$	62,211	$	(9,701)	$	(30,548)	$	57,981
Comprehensive income									1,777		3,414				5,191
Dividends—common stock(1)				2,846	0		0		(233)						(233)
Dividends—preferred stock									(57)						(57)
Purchases of treasury stock													(161)		(161)
Issuances of common stock and restricted stock, net of forfeitures				691,072	0		76								76
Exercises of stock options				160,741	0		3								3
Compensation expense for restricted stock units							125								125
Balance as of September 30, 2024	4,975,000	$	0	701,557,753	$	7	$	36,216	$	63,698	$	(6,287)	$	(30,709)	$	62,925

__________

(1)We declared dividends per share on our common stock of $0.60 in both the third quarter of 2025 and 2024, and $1.80 in both the first nine months of 2025 and 2024.

(2)Impact from the adoption of Accounting Standards Update (“ASU”) 2023-02, Investments - Equity Method and Joint Ventures (Topic 323): Accounting for Investments in Tax Credit Structures Using the Proportional Amortization Method as of January 1, 2024.

See Notes to Consolidated Financial Statements.
	82	Capital One Financial Corporation (COF)

CAPITAL ONE FINANCIAL CORPORATION

CONSOLIDATED STATEMENTS OF CASH FLOWS (UNAUDITED)

	Nine Months Ended September 30,
(Dollars in millions)	2025		2024
Operating activities:
Income from continuing operations, net of tax	$	334	$	3,654
Loss from discontinued operations, net of tax	(15)		0
Net income	319		3,654
Adjustments to reconcile net income to net cash from operating activities:
Provision for credit losses	16,513		9,074
Depreciation and amortization, net	3,655		2,423
Deferred tax benefit	(1,404)		(501)
Net securities losses	0		35
Loss (gain) on sales of loans	2		27
Stock-based compensation expense	576		425
Other fair value adjustments	101		37
Loans held for sale:
Originations and purchases	(3,687)		(2,603)
Proceeds from sales and paydowns	3,264		2,887
Changes in operating assets and liabilities:
Changes in interest receivable	2		(99)
Changes in other assets	(640)		913
Changes in interest payable	(187)		56
Changes in other liabilities	1,359		(617)
Net change from discontinued operations	14		0
Net cash from (used in) operating activities	$	19,887	$	15,711
Investing activities:
Securities available for sale:
Purchases	(12,585)		(11,677)
Proceeds from paydowns and maturities	13,287		8,732
Proceeds from sales	1		175
Proceeds from sales of securities related to the Transaction	9,696		0
Loans:
Net changes in loans originated as held for investment	(20,849)		(9,984)
Principal recoveries of loans previously charged off	3,647		2,197
Changes in premises and equipment	(1,134)		(848)
Net cash received in the Transaction	16,465		0
Net cash used in other investing activities	(1,163)		(756)
Net cash from (used in) investing activities	$	7,365	$	(12,161)

See Notes to Consolidated Financial Statements.
	83	Capital One Financial Corporation (COF)

CAPITAL ONE FINANCIAL CORPORATION

CONSOLIDATED STATEMENTS OF CASH FLOWS (UNAUDITED)

	Nine Months Ended September 30,
(Dollars in millions)	2025		2024
Financing activities:
Deposits and borrowings:
Changes in deposits	$	(1,046)	$	4,987
Issuance of securitized debt obligations	1,495		997
Maturities and paydowns of securitized debt obligations	(8,097)		(3,434)
Issuance of senior and subordinated notes	4,481		3,985
Maturities and paydowns of senior and subordinated notes	(6,307)		(2,911)
Changes in other borrowings	48		(21)
Common stock:
Net proceeds from issuances	295		251
Dividends paid	(1,008)		(700)
Preferred stock:
Net proceeds from issuances	0		0
Dividends paid	(179)		(171)
Redemptions	(500)		0
Purchases of treasury stock	(1,579)		(573)
Proceeds from share-based payment activities	1		4
Net cash from (used in) financing activities	(12,396)		2,414
Changes in cash, cash equivalents and restricted cash for securitization investors	14,856		5,964
Cash, cash equivalents and restricted cash for securitization investors, beginning of the period	43,671		43,755
Cash, cash equivalents and restricted cash for securitization investors, end of the period	$	58,527	$	49,719
Supplemental cash flow information:
Interest paid	$	10,828	$	9,831
Income tax paid	494		563
Non-cash item:
Reissuance of treasury stock, issuance of preferred stock and stock-based compensation awards related to the Transaction	$	51,790	$	0

See Notes to Consolidated Financial Statements.
	84	Capital One Financial Corporation (COF)

NOTE 1—SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES

The Company

Capital One Financial Corporation, a Delaware corporation established in 1994 and headquartered in McLean, Virginia, is a diversified financial services holding company with banking and non-banking subsidiaries. Capital One Financial Corporation and its subsidiaries (the “Company” or “Capital One”) offer a broad array of financial products and services to consumers, small businesses and commercial clients through digital channels, branch locations, cafés and other distribution channels.

As of September 30, 2025, Capital One Financial Corporation’s principal operating subsidiary was Capital One, National Association (“CONA”). On May 18, 2025 (the “Closing Date”), Discover Financial Services (“Discover”) merged into Capital One and Discover Bank merged into CONA. See “Note 2—Business Combinations and Discontinued Operations” for additional information. The Company is hereafter collectively referred to as “we,” “us” or “our.” CONA is referred to as the “Bank.”

We offer credit cards, debit cards, bank lending, treasury management and depository services, auto loans, and other consumer lending products in markets across the U.S. We service banking customer accounts through digital channels and our network of branch locations, cafés, call centers and automated teller machines (“ATMs”). Additionally, through the acquisition of Discover, we acquired new products including personal loans as well as the Discover Network, the PULSE Network, Diners Club International (“Diners Club”) and Network Partners (collectively, the “Global Payment Network”). The Discover Network processes transactions for credit and debit cards issued on its network and provides payment transaction processing and settlement services. The PULSE Network operates an electronic funds transfer network, providing financial institutions issuing debit cards on the PULSE Network with access to ATMs domestically and internationally, as well as merchant acceptance throughout the U.S. for debit card transactions. Diners Club is a global payments network of licensees, which are generally financial institutions, that issue Diners Club-branded charge cards and/or provide card acceptance services. We also have agreements with a number of financial institutions, financial technology firms, networks, network-to-network partners and other commercial service providers (collectively, “Network Partners”) for the provision of card issuing, payments processing and related services on the Global Payment Network.

We also offer credit card products and certain other services outside of the U.S. through Capital One (Europe) plc (“COEP”), an indirect subsidiary of CONA organized and located in the United Kingdom (“U.K.”), and through a branch of CONA in Canada. Both COEP and our Canadian branch of CONA have the authority to provide credit card loans. In addition, we offer Global Payment Network services globally.

Our principal operations are organized for management reporting purposes into three major business segments, which are defined primarily based on the products and services provided or the types of customer served: Credit Card, Consumer Banking and Commercial Banking. We provide details on our business segments, the integration of any recent material acquisitions into our business segments, and the allocation methodologies and accounting policies used to derive our business segment results in “Note 13—Business Segments and Revenue from Contracts with Customers.”

Basis of Presentation and Use of Estimates

The accompanying unaudited interim consolidated financial statements have been prepared in accordance with generally accepted accounting principles in the U.S. (“U.S. GAAP”). The preparation of the consolidated financial statements in conformity with U.S. GAAP requires management to make estimates and assumptions that affect the amounts reported in the consolidated financial statements and in the related disclosures. These estimates are based on information available as of the date of the consolidated financial statements. While management makes its best judgments, actual amounts or results could differ from these estimates. In the opinion of management, all normal, recurring adjustments have been included for a fair statement of this interim financial information.

These unaudited interim consolidated financial statements should be read in conjunction with the audited consolidated financial statements, and related notes thereto, included in Capital One Financial Corporation’s 2024 Annual Report on Form 10-K (“2024 Form 10-K”). We have described relevant updates to the significant accounting policies presented in 2024 Form 10-K below. Such updates are primarily a result of the Transaction (as defined below).

85 Capital One Financial Corporation (COF)

Discount and Interchange Income

Discount and interchange income represents the amounts we earn and retain from transactions between cardholders and merchants on credit and debit card products. Contractually defined per-transaction fee amounts typically apply to each type of transaction processed. We recognize discount and interchange income upon settlement.

Discount income represents the amount we charge merchants with whom we have entered into card acceptance agreements for processing credit card purchase transactions. We stand ready to process payment transactions as and when a transaction is presented.

Generally, interchange income is earned from two sources. We earn acquirer interchange income primarily from merchant acquirers on Discover Network, Diners Club and PULSE Network transactions made by credit and debit card customers at merchants with whom merchant acquirers have entered into card acceptance agreements for processing payment card transactions. Under these agreements, we stand ready to process payment transactions as and when each is presented. We also earn interchange income as a card issuer in the form of a fee for standing ready to authorize and providing settlement on credit and debit card transactions processed through the Mastercard® (“Mastercard”) and Visa® (“Visa”) interchange networks. The levels and structure of interchange rates we earn as a card issuer are set by Mastercard and Visa and can vary based on cardholder purchase volumes, among other factors.

We pay issuer interchange to card issuing entities that have entered into contractual arrangements to issue cards on the Discover Network and on certain transactions on the Diners Club and PULSE networks. This cost is contractually established and is based on the card issuing organization’s transaction volume. We present this cost as a reduction of discount and interchange income. We accrue for the cost at the time each underlying card transaction is captured for settlement. See “Note 13—Business Segments and Revenue from Contracts with Customers” for additional details.

Other Intangible Assets

Intangible assets with finite useful lives are amortized on either an accelerated or straight-line basis over their estimated useful lives and are evaluated for impairment whenever events or changes in circumstances indicate the carrying amount of the assets may not be recoverable. Intangible assets that have indefinite useful lives are not amortized, but are tested for impairment annually or more frequently if adverse circumstances indicate that it is more likely than not that the carrying amount of the asset exceeds its fair value. See “Note 7—Goodwill and Other Intangible Assets” for additional information.

Income Taxes

Our effective tax rate in the third quarter of 2025 was computed utilizing the annual method. We changed our methodology from the year-to-date method utilized in the second quarter of 2025 due to the return of the proportional relationship between our tax provision, tax credit investments and pre-tax income.

86 Capital One Financial Corporation (COF)

NOTE 2—BUSINESS COMBINATIONS AND DISCONTINUED OPERATIONS

Discover Acquisition

On February 19, 2024, the Company entered into an agreement and plan of merger (the “Merger Agreement”), by and among Capital One, Discover, a Delaware corporation and Vega Merger Sub, Inc., a Delaware corporation and a direct, wholly owned subsidiary of the Company (“Merger Sub”). On May 18, 2025, the Company closed the acquisition of Discover, pursuant to which (i) Merger Sub merged with and into Discover, with Discover as the surviving entity in the merger (the “Merger”); (ii) immediately following the Merger, Discover, as the surviving entity, merged with and into Capital One, with Capital One as the surviving entity in the second-step merger (the “Second Step Merger”); and (iii) immediately following the Second Step Merger, Discover Bank, a Delaware-chartered and wholly owned subsidiary of Discover, merged with and into CONA, with CONA as the surviving entity in the merger (the “CONA Bank Merger,” and collectively with the Merger and Second Step Merger, the “Transaction”). The Transaction enables the Company to leverage its newly acquired networks, customer base, technology, and data ecosystem to drive value for merchants, consumers, and small businesses.

Upon closing, each share of common stock of Discover outstanding immediately prior to the effective time of the Merger, other than certain shares held by Discover or Capital One, was converted into the right to receive 1.0192 shares of common stock of Capital One. Holders of Discover common stock received cash in lieu of fractional shares. At the effective time of the Second Step Merger, each share of Fixed-to-Floating Rate Non-Cumulative Perpetual Preferred Stock, Series C, of Discover, and each share of 6.125% Fixed-Rate Reset Non-Cumulative Perpetual Preferred Stock, Series D, of Discover, in each case outstanding immediately prior to the effective time of the Second Step Merger, was converted into the right to receive a share of newly created Fixed-to-Floating Rate Non-Cumulative Perpetual Preferred Stock, Series O or 6.125% Fixed-Rate Reset Non-Cumulative Perpetual Preferred Stock, Series P of Capital One. The following table summarizes the terms of the preferred stock issued as part of the Transaction.

Table 2.1: Summary of Preferred Stock Terms

			Redeemable by Issuer Beginning	Per Annum Dividend Rate	Dividend Frequency	Liquidation Preference per Share	Total Shares Issued
Series	Description	Issuance Date
Series O	Fixed-to-Floating Rate Non-Cumulative	May 18, 2025	October 30, 2027	5.500% through 10/29/2027; resets 10/30/2027 and every quarter thereafter at three-month term SOFR + 3.338%	Semi-Annually through 10/30/2027;Quarterly thereafter	100,000	5,700
Series P(1)	6.125% Fixed- Rate Reset Non-Cumulative	May 18, 2025	June 23, 2025	6.125% through 9/22/2025; resets 9/23/2025 and every subsequent 5 year anniversary at 5-Year Treasury Rate +5.783%	Semi-Annually	100,000	5,000

________

(1)Series P was fully redeemed on June 30, 2025. See “Item 2. MD&A—Capital Management” for additional information.

The Company reissued 256,497,213 shares of treasury stock valued at $50.6 billion as of the Closing Date to holders of Discover common stock, issued the 10,700 shares of Series O and Series P preferred stock described in the table above to holders of Discover preferred stock valued at $1.1 billion, and exchanged Discover stock-based compensation awards for Capital One replacement awards with a Closing Date value of $136 million, representing total purchase consideration of $51.8 billion.

For the three and nine months ended September 30, 2025, we incurred $348 million and $757 million, respectively, of integration expenses related to the Transaction. The integration expenses are primarily driven by salaries and associate benefits and professional services, along with $124 million of acquisition-related expenses incurred as of the Closing Date. Integration expenses are included within operating expense in our consolidated statements of income. Since the announcement of the Transaction in the first quarter of 2024, we have incurred $991 million of integration expenses as of September 30, 2025.

We accounted for the Transaction as a business combination in accordance with Topic 805, Business Combinations, with the Company as the accounting acquirer. Accordingly, we recorded the tangible and intangible assets acquired and liabilities assumed at their respective fair values as of the Closing Date, unless otherwise required. The determination of fair value requires management to make estimates about discount rates, future expected cash flows, market conditions and other future

87 Capital One Financial Corporation (COF)

events that are subjective in nature and subject to change. Fair value estimates related to the assets acquired and liabilities assumed are subject to adjustment for up to one year after the Closing Date as additional information becomes available (the “Measurement Period”). The Company’s purchase consideration allocation is considered preliminary as certain estimates related to the assets acquired and liabilities assumed are subject to continuing refinement. Valuations subject to refinement include, but are not limited to, loans, intangible assets, deposits and certain other assets and liabilities.

The following Tables 2.2 through 2.5 present the preliminary allocation of the purchase consideration to the assets acquired and liabilities assumed as of the Closing Date. The amounts below reflect Measurement Period adjustments made during the third quarter of 2025, which primarily included a $600 million decrease in intangible assets, a $109 million decrease in premises and equipment, a $148 million decrease in deferred tax liabilities and a $536 million increase to goodwill.

Table 2.2: Preliminary Allocation of Purchase Consideration

(in millions, except share and per share data)	Fair Value
Purchase consideration:
Shares of Discover common stock issued and outstanding immediately prior to the acquisition	251,679,740
Exchange ratio	1.0192
Number of shares of Capital One treasury stock reissued in the acquisition before fractional shares adjustment	256,511,991
Less: Number of fractional shares	(14,778)
Number of shares of Capital One treasury stock reissued in the acquisition	256,497,213
Price per share of Capital One common stock	$	197.22
Fair value of consideration for outstanding common stock	50,586
Fair value of consideration for preferred stock	1,068
Fair value of consideration related to stock-based compensation awards	136
Cash in lieu of fractional shares	3
Fair value of purchase consideration	$	51,793
Allocation of purchase consideration to net assets acquired:
Preliminary fair value of assets acquired:
Cash and cash equivalents and Restricted cash for securitization investors(1)	$	16,467
Securities available for sale	14,108
Net loans held for investment (see Table 2.3)	108,609
Premises and equipment	956
Interest receivable	926
Intangible assets (see Table 2.4)	17,610
Other assets(2)	1,448
Assets of discontinued operations(3)	7,981
Preliminary fair value of liabilities assumed:
Interest payable	347
Non-interest-bearing deposits	1,710
Interest-bearing deposits (see Table 2.5)	105,208
Securitized debt obligations	5,827
Senior and subordinated notes	6,917
Other borrowings	538
Deferred tax liability(4)	3,455
Other liabilities(5)	6,088
Preliminary fair value of net assets acquired	$	38,015
Preliminary Goodwill	$	13,778

________

(1)Includes $1.0 billion restricted cash primarily related to securitization investors.

(2)Includes tax credit and other investments, non-loan receivables, derivative assets, and other short-term assets.

(3)Includes $7.9 billion of home loans classified as discontinued operations.

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(4)The Transaction generated a net deferred tax liability. On a consolidated basis, this net deferred tax liability is included in Other assets on the Consolidated Balance Sheet as we have a total net deferred tax asset as of September 30, 2025.

(5)Includes rewards liabilities, associate compensation and benefit related liabilities, derivative liabilities, and other accrued expenses. Also includes the liability related to the Card Product Misclassification matter as of the Closing Date. For additional information, refer to “Note 14—Commitments, Contingencies, Guarantees and Others.”

The following table includes the fair value and unpaid principal balance of the acquired loans held for investment:

Table 2.3: Acquired Loans Held for Investment

(Dollars in millions)	Unpaid Principal Balance		Premium/(Discount)(1)		Loans held for investment		Allowance for credit losses		Net loans held for investment
Non-PCD loans	$	101,614	$	1,069	$	102,683	$	0	$	102,683
PCD loans	6,894		(538)		6,356		(2,870)		3,486
Recoveries on acquired Discover loans that are fully charged off(2)	N/A		(865)		(865)		3,305		2,440
Total	$	108,508	$	(334)	$	108,174	$	435	$	108,609

________

(1)The premium of $1.1 billion for Non-PCD loans and non-credit discount of $1.4 billion for PCD loans will be amortized over the period of expected cash flows of the applicable loans.

(2)Charge-offs exclude $19.4 billion of acquired PCD loans that are fully charged-off, with the expected recoveries of $3.3 billion included as a benefit to the allowance for credit losses.

Purchased loans were evaluated to determine if, at the time of purchase, the loans had experienced a more-than-insignificant deterioration in credit quality since origination. In evaluating PCD loans, we considered a variety of factors including but not limited to delinquency, loan modification, revocation of revolving privileges and other qualitative factors that indicate deterioration in credit quality. Contractual rights to collect on recoveries of loans charged off by Discover were also considered in scope of the PCD accounting model.

Subsequent to the closing of the Transaction, in the second quarter of 2025, we recorded an allowance for credit losses for non-PCD loans of $8.8 billion through the provision for credit losses in accordance with ASC 326.

The following table summarizes the fair value of the intangible assets acquired:

Table 2.4: Fair Value of Acquired Intangible Assets

(Dollars in millions)	Useful Life (1)	Amortization Methodology	Fair Value
Purchased credit card relationships	11	Accelerated	$	10,100
Network and financial partner relationships	11	Straight-line	1,500
Core deposit	10	Accelerated	1,040
Intangible assets with definite lives			12,640
Discover Network	N/A	N/A - Indefinite useful life	2,700
Brand/Trade names	N/A	N/A - Indefinite useful life	2,270
Intangible assets with indefinite lives			4,970
Total intangible assets			$	17,610

________

(1)Weighted-average amortization period for acquired amortizing intangible assets is 11 years.

89 Capital One Financial Corporation (COF)

The following table summarizes the fair value of the interest-bearing deposits acquired:

Table 2.5: Fair Value of Acquired Interest-bearing Deposits

(Dollars in millions)	Fair Value
Time deposits	$	39,630
Other interest-bearing deposits	65,578
Total interest-bearing deposits	$	105,208

As of September 30, 2025, we recorded preliminary goodwill from the Transaction of $13.8 billion, representing the amount by which total purchase consideration exceeded the preliminary fair value of the net assets acquired. The preliminary goodwill is primarily attributable to the revenue and cost synergies expected to arise from the Transaction. As the Transaction is nontaxable, goodwill is not deductible for tax purposes.

Goodwill has been preliminarily allocated to the Credit Card ($6.8 billion) and Other Consumer Banking ($7.0 billion) reporting units. As the Company continues to evaluate the underlying inputs and assumptions that are being used in the fair value estimates of net assets acquired, we may obtain additional information during the Measurement Period that may result in changes to the preliminary estimate of fair value of net assets acquired, preliminary goodwill, and the allocation of preliminary goodwill to our reporting units.

The following is a description of the methods used to determine the fair values of the significant assets acquired and liabilities assumed.

Cash and cash equivalents and Restricted cash for securitization investors: The carrying amount of these assets was a reasonable estimate of fair value based on the short-term nature of these assets, with the exception of certain securities maturing in less than 90 days from the Closing Date, which followed the same fair value methodology as Investment Securities.

Investment Securities: Fair values for investment securities were based on quoted market prices, where available. If quoted market prices were not available, fair value estimates were based on observable inputs including quoted market prices for similar instruments, quoted market prices that were not in an active market or other inputs that were observable in the market. In the absence of observable inputs, fair value was estimated based on pricing models and/or discounted cash flow methodologies. This fair value methodology is consistent with that described in “Note 12—Fair Value Measurement” for our investment securities portfolio.

Loans: Fair values for loans held for investment were based on a discounted cash flow methodology that considered credit loss expectations, market interest rates and other market factors from the perspective of a market participant. Loans were grouped together according to similar characteristics when applying various valuation assumptions. The probability of default, loss given default and prepayment assumptions were the key factors driving credit losses which were embedded into the estimated cash flows. These assumptions were informed by internal data on loan characteristics, historical loss experience, and market data. The interest component of the estimate was determined by discounting interest and principal cash flows through the life of each loan. The discount rates used for loans reflect market participants' considerations of prepayment, default, market, liquidity and other risk associated with the portfolio.

Interest Receivable: The fair value of interest receivable approximated its carrying amount due to the short-term nature of the receivable.

Intangible assets: The intangible assets identified in the Transaction include purchased credit card relationships, the Discover Network, brand/trade names, network and financial partner relationships and a core deposit intangible. All intangible assets were valued using an income approach under which future cash flows for each intangible asset were forecasted, tax-effected and then discounted using an appropriately risk-adjusted discount rate. A description of each intangible asset, along with the key inputs used in its valuation, is provided below:

•Purchased credit card relationships: represent the value of future activity from existing credit card relationships over their expected lives. The fair value was estimated utilizing the multi-period excess earnings method, a type of the income approach. The key inputs into the valuation included projected future finance charge and fee income using

90 Capital One Financial Corporation (COF)

assumptions of cardholder activity, relevant operating costs for managing these relationships, attrition based on cardholder account retention levels, contributory asset charges reflective of the other assets of the business that are required to generate these cash flows, a discount rate determined based on the estimated cost of equity, risk-free return rate and risk premium for the market and the specific risk profile of the intangible asset relative to the other assets acquired and the overall business, and the tax rate reflective of the jurisdictions in which the Company operates.

•Network and financial partner relationships: represent the value associated with the economics generated by the existing third-party partners, including third-party issuers of PULSE debit cards. The fair value was estimated utilizing the multi-period excess earnings method, a type of the income approach. The key inputs into the valuation included cash flow forecasts derived from revenue attributable to the partner relationships less applicable operating costs, attrition based on customer retention levels, the discount rate determined based on the estimated cost of equity, risk-free return rate and risk premium for the market and the specific risk profile of the respective intangible assets relative to the other assets acquired and the overall business, and the tax rate reflective of the jurisdictions in which the Company operates.

•Core deposit: represents the economics associated with the favorable funding spread between the acquired core deposit base and alternative sources of funding. The fair value was estimated utilizing the cost savings method, a type of the income approach. The key inputs into the valuation included attrition based on customer retention levels, alternative cost of funds at the time of acquisition, expected balance inflation over time, the discount rate determined based on the estimated cost of equity, risk-free return rate and risk premium for the market and the specific risk profile of the intangible asset relative to the other assets acquired and the overall business, and the tax rate reflective of the jurisdictions in which the Company operates.

•Discover Network: represents the value associated with the economics generated by the proprietary payment network, including any expected synergies. The fair value was estimated utilizing the multi-period excess earnings method, a type of the income approach. The key inputs into the valuation included the cash flow forecast derived from projected future revenues and costs associated with the network (inclusive of any synergies), contributory asset charges reflective of the other assets that are required in order for the network to generate these projected cash flows, a discount rate determined based on the estimated cost of equity, risk-free return rate and risk premium for the market and the specific risk profile of the intangible asset relative to the other assets acquired and the overall business, and the tax rate reflective of the jurisdictions in which the Company operates.

•Brand/Trade names: represent the economic benefits of the ability to generate revenue based on the value of the trade names, which include the Discover, Diners Club and PULSE brands. The fair value for each was estimated utilizing the relief-from-royalty-method, a type of the income approach. The key inputs into the valuation included assumed royalty rates based on market transactions, cash flow forecasts derived from revenue attributable to each trade name, a discount rate determined based on the estimated cost of equity, risk-free return rate and risk premium for the market and the specific risk profile of the respective intangible assets relative to the other assets acquired and the overall business, and the tax rate reflective of the jurisdictions in which the Company operates.

Interest-bearing deposits: The fair value of the time deposits was determined using a discounted cash flow model, whereby the expected cash flows associated with these time deposits were discounted at a market rate. The carrying amount of savings deposits, money market accounts, and other interest-bearing deposits approximated their fair values.

Securitized debt obligations: Senior and subordinated notes; and Other borrowings: Fair values for securitized debt obligations, senior and subordinated notes, and other borrowings were based on quoted market prices, where available. If a market price was not available, valuations were based on quoted prices of comparable instruments. If neither approach was available, a discounted cash flow analysis was used, incorporating prevailing borrowing rates for similar financial instruments.

Pro Forma Financial Information (unaudited)

Our results from continuing operations for the nine months ended September 30, 2025 include contributions to net interest income, non-interest income, and net income (loss) from continuing operations of $5.3 billion, $1.1 billion, and $(5.3) billion, respectively, from Discover. These results include the impacts from purchase accounting and the impact to provision for credit losses for the Discover non-PCD loan portfolio and exclude any amounts from areas that have been integrated and are therefore are not distinguishable from the results of our combined results of operations.

91 Capital One Financial Corporation (COF)

The table below presents certain unaudited pro forma information that combines the historical results of operations of Capital One and Discover for the three and nine months ended September 30, 2025 and 2024, as if the Transaction had occurred on January 1, 2024. Included in the pro forma results are adjustments to reflect the impact of amortizing certain purchase accounting adjustments, such as the amortization of intangible assets and the accretion of discounts on certain acquired loans, transaction costs, as well as reflecting the impact of Discover’s sale of its student loan portfolio in 2024.

Table 2.6: Selected Unaudited Pro Forma Results

	Combined Pro Forma Results
	Three Months Ended September 30,				Nine Months Ended September 30,
(Dollars in millions)	2025		2024		2025		2024
Net interest income(1)	$	12,580	$	11,738	$	36,335	$	33,583
Non-interest income	2,955		2,564		8,397		7,827
Income from continuing operations, net of tax(2)	3,363		2,123		8,369		(361)

________

(1)Combined pro forma net interest income for the three months and nine months ended September 30, 2024 was adjusted to remove $244 million and $764 million, respectively, of interest income from the sold Discover student loan portfolio.

(2)Combined pro forma income from continuing operations, net of tax, was adjusted to reflect the $8.8 billion increase to the provision for credit losses for the Discover non-PCD loan portfolio recognized in the nine months ended September 30, 2025 as if it had been recognized consistent with a Closing Date of January 1, 2024.

This pro forma financial information is presented for illustrative purposes only and does not necessarily reflect what the actual combined financial results would have been had the closing of the Transaction been completed on January 1, 2024, nor is the information indicative of the results of operations in future periods. The pro forma financial information does not reflect the impact of possible business model changes nor does it consider any potential impacts of synergies, market conditions, or other factors.

Discontinued Operations

In the second quarter of 2025, the Board of Directors approved a plan to exit the Discover Home Loan business acquired as a part of the Transaction. The Home Loan business includes the origination and servicing of conventional mortgage refinance and home equity loans that are single family, owner occupied, closed-end with fixed interest rates, terms and payments, and are secured by a first or second lien. During the third quarter of 2025, the Company stopped originations of home loan products. We are actively marketing the business and are in the process of identifying potential buyers, with the sale expected to close within one year. As a result, the assets and liabilities of the Home Loan business have been classified as held for sale and are reported as assets of discontinued operations and liabilities of discontinued operations on the consolidated balance sheets, along with any associated hedges. The results of the Home Loan business, including any associated hedges, have been accounted for as discontinued operations and are reported as income or loss from discontinued operations, net of tax, on the consolidated statement of income.

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NOTE 3—INVESTMENT SECURITIES

Our investment securities portfolio consists of the following: U.S. government-sponsored enterprise or agency (“GSE” or “Agency”) and non-agency residential mortgage-backed securities (“RMBS”), agency commercial mortgage-backed securities (“CMBS”), U.S. Treasury securities and other securities. Agency securities include securities guaranteed by the Government National Mortgage Association (“Ginnie Mae”) and securities issued by the Federal National Mortgage Association (“Fannie Mae”) and the Federal Home Loan Mortgage Corporation (“Freddie Mac”). The carrying value of our investments in Agency and U.S. Treasury securities represented 97% and 96% of our total investment securities portfolio as of September 30, 2025 and December 31, 2024, respectively.

The table below presents the amortized cost, allowance for credit losses, gross unrealized gains and losses and fair value of our investment securities aggregated by major security type as of September 30, 2025 and December 31, 2024. Accrued interest receivable of $302 million and $262 million as of September 30, 2025 and December 31, 2024, respectively, is not included in the table below.

Table 3.1: Investment Securities Available for Sale

	September 30, 2025
(Dollars in millions)	Amortized Cost		Allowance  for Credit  Losses		Gross Unrealized Gains		Gross Unrealized Losses		Fair Value
Investment securities available for sale:
U.S. Treasury securities	$	8,613	$	0	$	28	$	(4)	$	8,637
RMBS:
Agency	75,246		0		218		(7,167)		68,297
Non-agency	536		(3)		72		(3)		602
Total RMBS	75,782		(3)		290		(7,170)		68,899
Agency CMBS	8,795		0		35		(390)		8,440
Other securities(1)	3,749		0		8		0		3,757
Total investment securities available for sale	$	96,939	$	(3)	$	361	$	(7,564)	$	89,733

	December 31, 2024
(Dollars in millions)	Amortized Cost		Allowance  for Credit  Losses		Gross Unrealized Gains		Gross Unrealized Losses		Fair Value
Investment securities available for sale:
U.S. Treasury securities	$	6,114	$	0	$	5	$	(9)	$	6,110
RMBS:
Agency	74,177		0		57		(9,527)		64,707
Non-agency	567		(4)		64		(6)		621
Total RMBS	74,744		(4)		121		(9,533)		65,328
Agency CMBS	8,389		0		17		(581)		7,825
Other securities(1)	3,748		0		5		(3)		3,750
Total investment securities available for sale	$	92,995	$	(4)	$	148	$	(10,126)	$	83,013

__________

(1)Includes $1.8 billion and $2.0 billion of asset-backed securities as of September 30, 2025 and December 31, 2024, respectively. The remaining amount is primarily comprised of supranational bonds, foreign government bonds and U.S. agency debt bonds.

93 Capital One Financial Corporation (COF)

Investment Securities in a Gross Unrealized Loss Position

The table below provides the gross unrealized losses and fair value of our securities available for sale aggregated by major security type and the length of time that individual securities have been in a continuous unrealized loss position as of September 30, 2025 and December 31, 2024. The amounts include securities available for sale without an allowance for credit losses.

Table 3.2: Securities in a Gross Unrealized Loss Position

	September 30, 2025
	Less than 12 Months				12 Months or Longer				Total
(Dollars in millions)	Fair Value		Gross Unrealized Losses		Fair Value		Gross Unrealized Losses		Fair Value		Gross Unrealized Losses
Investment securities available for sale without an allowance for credit losses:
U.S. Treasury securities	$	712	$	(1)	$	1,204	$	(3)	$	1,916	$	(4)
RMBS:
Agency	2,014		(5)		48,313		(7,162)		50,327		(7,167)
Non-agency	2		0		8		0		10		0
Total RMBS	2,016		(5)		48,321		(7,162)		50,337		(7,167)
Agency CMBS	466		(2)		5,555		(388)		6,021		(390)
Other securities	530		0		0		0		530		0
Total investment securities available for sale in a gross unrealized loss position without an allowance for credit losses(1)	$	3,724	$	(8)	$	55,080	$	(7,553)	$	58,804	$	(7,561)

	December 31, 2024
	Less than 12 Months				12 Months or Longer				Total
(Dollars in millions)	Fair Value		Gross Unrealized Losses		Fair Value		Gross Unrealized Losses		Fair Value		Gross Unrealized Losses
Investment securities available for sale without an allowance for credit losses:
U.S. Treasury securities	$	1,724	$	(6)	$	931	$	(3)	$	2,655	$	(9)
RMBS:
Agency	11,324		(178)		48,707		(9,349)		60,031		(9,527)
Non-agency	3		0		11		(1)		14		(1)
Total RMBS	11,327		(178)		48,718		(9,350)		60,045		(9,528)
Agency CMBS	700		(7)		5,677		(574)		6,377		(581)
Other securities	1,438		(3)		0		0		1,438		(3)
Total investment securities available for sale in a gross unrealized loss position without an allowance for credit losses(1)	$	15,189	$	(194)	$	55,326	$	(9,927)	$	70,515	$	(10,121)

__________

(1)    Consists of approximately 2,330 and 2,740 securities in gross unrealized loss positions as of September 30, 2025 and December 31, 2024, respectively.

Maturities and Yields of Investment Securities

The table below summarizes, as of September 30, 2025, the fair value of our investment securities by major security type and contractual maturity as well as the total fair value, amortized cost and weighted-average yields of our investment securities by contractual maturity. Since borrowers may have the right to call or prepay certain obligations, the expected maturities of our securities are likely to differ from the scheduled contractual maturities presented below. The weighted-average yield below represents the effective yield for the investment securities presented on a pre-tax basis and is calculated based on the amortized cost of each security, inclusive of the contractual coupon, the impact of any premium amortization or discount accretion and any hedge accounting relationships.

94 Capital One Financial Corporation (COF)

Table 3.3: Contractual Maturities and Weighted-Average Yields of Securities

	September 30, 2025
(Dollars in millions)	Due in 1 Year or Less		Due > 1 Year through 5 Years		Due > 5 Years through 10 Years		Due > 10 Years		Total
Fair value of securities available for sale:
U.S. Treasury securities	$	2,447	$	2,390	$	3,800	$	0	$	8,637
RMBS(1):
Agency	4		123		1,135		67,035		68,297
Non-agency	0		0		31		571		602
Total RMBS	4		123		1,166		67,606		68,899
Agency CMBS(1)	1,156		2,957		2,492		1,835		8,440
Other securities	151		3,539		0		67		3,757
Total securities available for sale	$	3,758	$	9,009	$	7,458	$	69,508	$	89,733
Amortized cost of securities available for sale	$	3,761	$	9,071	$	7,641	$	76,466	$	96,939
Weighted-average yield for securities available for sale	4.24%		3.77%		4.09%		3.93%		3.94%

__________

(1)As of September 30, 2025, the weighted-average expected maturities of RMBS and Agency CMBS were 8.0 years and 4.3 years, respectively.

Net Securities Gains or Losses and Proceeds from Sales

We had no sales of securities for the three months ended September 30, 2025. For the nine months ended September 30, 2025 total proceeds from sales of our securities were $9.7 billion with immaterial losses. For the three and nine months ended September 30, 2024, total proceeds from sales of our securities were $175 million with losses of $35 million.

Securities Pledged and Received

We pledged investment securities totaling $37.4 billion and $39.4 billion as of September 30, 2025 and December 31, 2024, respectively. These securities are primarily pledged to support our advances from Federal Home Loan Bank (“FHLB”) advances and Public Fund Deposits, as well as for other purposes as required or permitted by law. We accepted pledges of securities with a fair value of approximately $1 million and $18 million as of September 30, 2025 and December 31, 2024, respectively, related to our derivative transactions.

95 Capital One Financial Corporation (COF)

NOTE 4—LOANS

Our loan portfolio consists of loans held for investment, including loans held in our consolidated trusts, and loans held for sale. We further divide our loans held for investment into three portfolio segments: Credit Card, Consumer Banking and Commercial Banking. The Credit Card segment consists of domestic credit card loans, international credit card loans and personal loans. The Consumer Banking segment consists of auto and retail banking loans. The Commercial Banking segment consists of commercial and multifamily real estate as well as commercial and industrial loans. The information presented in the tables in this note excludes loans held for sale, which are carried at either fair value (if we elect the fair value option) or at the lower of cost or fair value.

Accrued interest receivable of $3.1 billion and $2.2 billion as of September 30, 2025 and December 31, 2024, respectively, is not included in the tables in this note. The table below presents the composition and aging analysis of our loans held for investment portfolio as of September 30, 2025 and December 31, 2024. The delinquency aging includes all past due loans, both performing and nonperforming.

Table 4.1: Loan Portfolio Composition and Aging Analysis

	September 30, 2025
			Delinquent Loans
(Dollars in millions)	Current		30-59 Days		60-89 Days		> 90 Days		Total Delinquent Loans		Total Loans
Credit Card:
Domestic credit card	$	244,063	$	3,015	$	2,198	$	4,675	$	9,888	$	253,951
Personal loans	9,469		72		55		50		177		9,646
International card businesses	7,088		120		81		151		352		7,440
Total credit card	260,620		3,207		2,334		4,876		10,417		271,037
Consumer Banking:
Auto	77,448		2,898		1,290		399		4,587		82,035
Retail banking	1,180		11		2		2		15		1,195
Total consumer banking	78,628		2,909		1,292		401		4,602		83,230
Commercial Banking:
Commercial and multifamily real estate	33,365		19		1		76		96		33,461
Commercial and industrial	55,023		9		123		276		408		55,431
Total commercial banking	88,388		28		124		352		504		88,892
Total loans(1)	$	427,636	$	6,144	$	3,750	$	5,629	$	15,523	$	443,159
% of Total loans	96.50%		1.39%		0.84%		1.27%		3.50%		100.00%

    

96 Capital One Financial Corporation (COF)

	December 31, 2024
			Delinquent Loans
(Dollars in millions)	Current		30-59 Days		60-89 Days		> 90 Days		Total Delinquent Loans		Total Loans
Credit Card:
Domestic credit card	$	148,565	$	1,973	$	1,503	$	3,577	$	7,053	$	155,618
Personal loans	N/A		N/A		N/A		N/A		N/A		N/A
International card businesses	6,570		107		72		141		320		6,890
Total credit card	155,135		2,080		1,575		3,718		7,373		162,508
Consumer Banking:
Auto	71,600		3,149		1,529		551		5,229		76,829
Retail banking	1,237		13		3		10		26		1,263
Total consumer banking	72,837		3,162		1,532		561		5,255		78,092
Commercial Banking:
Commercial and multifamily real estate	31,733		31		9		130		170		31,903
Commercial and industrial	55,030		3		22		217		242		55,272
Total commercial banking	86,763		34		31		347		412		87,175
Total loans(1)	$	314,735	$	5,276	$	3,138	$	4,626	$	13,040	$	327,775
% of Total loans	96.02%		1.61%		0.96%		1.41%		3.98%		100.00%

__________

(1)Loans include unamortized premiums, discounts and deferred fees and costs totaling $963 million and $1.2 billion as of September 30, 2025 and December 31, 2024, respectively.

97 Capital One Financial Corporation (COF)

The following table presents our loans held for investment that are 90 days or more past due that continue to accrue interest, loans that are classified as nonperforming and loans that are classified as nonperforming without an allowance as of September 30, 2025 and December 31, 2024. Nonperforming loans generally include loans that have been placed on nonaccrual status. We recognized interest income for loans classified as nonperforming of $4 million and $54 million for the three and nine months ended September 30, 2025, respectively, and $6 million and $70 million for the three and nine months ended September 30, 2024, respectively.

Table 4.2: 90+ Day Delinquent Loans Accruing Interest and Nonperforming Loans

	September 30, 2025									December 31, 2024
(Dollars in millions)	> 90 Days and Accruing			Nonperforming Loans			Nonperforming  Loans Without an Allowance			> 90 Days and Accruing			Nonperforming Loans			Nonperforming  Loans Without an Allowance
Credit Card:
Domestic credit card	$	4,675		N/A			$	0		$	3,577		N/A			$	0
Personal loans	47			$	13		0			N/A			N/A			N/A
International card businesses	145			12			0			134			$	10		0
Total credit card	4,867			25			0			3,711			10			0
Consumer Banking:
Auto	0			584			0			0			750			0
Retail banking	0			20			10			0			25			12
Total consumer banking	0			604			10			0			775			12
Commercial Banking:
Commercial and multifamily real estate	40			353			198			0			509			227
Commercial and industrial	0			883			464			96			701			607
Total commercial banking	40			1,236			662			96			1,210			834
Total	$	4,907		$	1,865		$	672		$	3,807		$	1,995		$	846
% of Total loans held for investment	1.11		%	0.42		%	0.15		%	1.16		%	0.61		%	0.26		%

98 Capital One Financial Corporation (COF)

Credit Quality Indicators

We closely monitor economic conditions and loan performance trends to assess and manage our exposure to credit risk. We discuss these risks and our credit quality indicator for each portfolio segment below.

Credit Card

Our Credit Card segment is highly diversified across millions of accounts and numerous geographies without significant individual exposure. We therefore generally manage credit risk based on portfolios with common risk characteristics. The risk in our Credit Card segment correlates to broad economic trends, such as the U.S. unemployment rate and U.S. Real Gross Domestic Product growth rate, as well as consumers’ financial condition, all of which can have a material effect on credit performance. The key indicator we assess in monitoring the credit quality and risk of our Credit Card segment is delinquency trends, including an analysis of loan migration between delinquency categories over time.

The tables below present our Credit Card segment by delinquency status as of September 30, 2025 and December 31, 2024.

Table 4.3: Domestic and International Credit Card Delinquency Status

	September 30, 2025						December 31, 2024
(Dollars in millions)	Revolving Loans		Revolving Loans Converted to Term		Total		Revolving Loans		Revolving Loans Converted to Term		Total
Credit Card:
Domestic credit card:
Current	$	242,530	$	1,533	$	244,063	$	148,112	$	453	$	148,565
30-59 days	2,929		86		3,015		1,944		29		1,973
60-89 days	2,133		65		2,198		1,483		20		1,503
Greater than 90 days	4,557		118		4,675		3,549		28		3,577
Total domestic credit card	252,149		1,802		253,951		155,088		530		155,618
International card businesses:
Current	7,047		41		7,088		6,533		37		6,570
30-59 days	115		5		120		102		5		107
60-89 days	77		4		81		69		3		72
Greater than 90 days	146		5		151		135		6		141
Total international card businesses	$	7,385	$	55	$	7,440	$	6,839	$	51	$	6,890

99 Capital One Financial Corporation (COF)

Table 4.4: Personal Loans Delinquency Status

	September 30, 2025
	Term Loans by Vintage Year
(Dollars in millions)	2025		2024		2023		2022		2021		Prior		Total Term Loans		Revolving Loans		Revolving Loans Converted to Term		Total
Personal loans—Delinquency status:
Current	$	3,216	$	3,161	$	1,930	$	805	$	264	$	93	$	9,469	$	0	$	0	$	9,469
30-59 days	6		22		25		13		4		2		72		0		0		72
60-89 days	4		18		20		9		3		1		55		0		0		55
Greater than 90 days	3		16		17		9		3		2		50		0		0		50
Total personal loans	$	3,229	$	3,217	$	1,992	$	836	$	274	$	98	$	9,646	$	0	$	0	$	9,646

The personal loans delinquency status table as of December 31, 2024 is not comparative as the Closing Date was subsequent to the period.

100 Capital One Financial Corporation (COF)

Consumer Banking

Our Consumer Banking segment consists of auto and retail banking loans. Similar to our Credit Card segment, the risk in our Consumer Banking segment correlates to broad economic trends as well as consumers’ financial condition, all of which can have a material effect on credit performance. The key indicator we consider when assessing the credit quality and risk of our auto loan portfolio is borrower credit scores as they measure the creditworthiness of borrowers. Delinquency trends are the key indicator we assess in monitoring the credit quality and risk of our retail banking loan portfolio.

The table below presents loans held for investment in our Consumer Banking segment loans held for investment by credit quality indicator as of September 30, 2025 and December 31, 2024. We present our auto loan portfolio by Fair Isaac Corporation (“FICO”) scores at origination and our retail banking loan portfolio by delinquency status, which includes all past due loans, both performing and nonperforming.

Table 4.5: Consumer Banking Portfolio by Vintage Year

	September 30, 2025
	Term Loans by Vintage Year
(Dollars in millions)	2025		2024		2023		2022		2021		Prior		Total Term Loans		Revolving Loans		Revolving Loans Converted to Term		Total
Auto—At origination FICO scores:(1)
Greater than 660	$	13,606	$	12,853	$	5,902	$	5,413	$	3,323	$	742	$	41,839	$	0	$	0	$	41,839
621-660	5,201		4,385		2,537		1,951		1,198		375		15,647		0		0		15,647
620 or below	9,718		6,489		3,589		2,445		1,551		757		24,549		0		0		24,549
Total auto	28,525		23,727		12,028		9,809		6,072		1,874		82,035		0		0		82,035
Retail banking—Delinquency status:
Current	83		129		71		81		42		433		839		338		3		1,180
30-59 days	0		0		0		0		0		2		2		9		0		11
60-89 days	0		0		0		0		0		1		1		1		0		2
Greater than 90 days	0		0		0		0		0		1		1		1		0		2
Total retail banking	83		129		71		81		42		437		843		349		3		1,195
Total consumer banking	$	28,608	$	23,856	$	12,099	$	9,890	$	6,114	$	2,311	$	82,878	$	349	$	3	$	83,230

    

101 Capital One Financial Corporation (COF)

	December 31, 2024
	Term Loans by Vintage Year
(Dollars in millions)	2024		2023		2022		2021		2020		Prior		Total Term Loans		Revolving Loans		Revolving Loans Converted to Term		Total
Auto—At origination FICO scores:(1)
Greater than 660	$	17,057	$	8,333	$	8,194	$	5,621	$	1,482	$	394	$	41,081	$	0	$	0	$	41,081
621-660	5,584		3,492		2,906		1,986		667		235		14,870		0		0		14,870
620 or below	8,102		4,882		3,626		2,546		1,207		515		20,878		0		0		20,878
Total auto	30,743		16,707		14,726		10,153		3,356		1,144		76,829		0		0		76,829
Retail banking—Delinquency status:
Current	143		78		93		49		51		469		883		351		3		1,237
30-59 days	0		0		0		0		0		2		2		11		0		13
60-89 days	0		0		0		0		0		1		1		2		0		3
Greater than 90 days	0		0		0		0		1		7		8		1		1		10
Total retail banking	143		78		93		49		52		479		894		365		4		1,263
Total consumer banking	$	30,886	$	16,785	$	14,819	$	10,202	$	3,408	$	1,623	$	77,723	$	365	$	4	$	78,092

__________

(1)Amounts represent period-end loans held for investment in each credit score category. Auto loan 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.

102 Capital One Financial Corporation (COF)

Commercial Banking

The key credit quality indicator for our Commercial Banking segment is our internal risk ratings. We assign internal risk ratings to loans based on relevant information about the ability of the borrowers to repay their debt. In determining the risk rating of a particular loan, some of the factors considered are the borrower’s current financial condition, historical and projected future credit performance, prospects for support from financially responsible guarantors, the estimated realizable value of any collateral and current economic trends. The scale based on our internal risk rating system is as follows:

•Noncriticized: Loans that have not been designated as criticized, frequently referred to as “pass” loans.

•Criticized performing: Loans in which the financial condition of the obligor is stressed, affecting earnings, cash flows or collateral values. The borrower currently has adequate capacity to meet near-term obligations; however, the stress, left unabated, may result in deterioration of the repayment prospects at some future date.

•Criticized nonperforming: Loans that are not adequately protected by the current net worth and paying capacity of the obligor or the collateral pledged, if any. Loans classified as criticized nonperforming have a well-defined weakness, or weaknesses, which jeopardize the full repayment of the debt. These loans are characterized by the distinct possibility that we will sustain a credit loss if the deficiencies are not corrected and are generally placed on nonaccrual status.

We use our internal risk rating system for regulatory reporting, determining the frequency of credit exposure reviews, and evaluating and determining the allowance for credit losses. Generally, loans that are designated as criticized performing and criticized nonperforming are reviewed quarterly by management to determine if they are appropriately classified/rated and whether any impairment exists. Noncriticized loans are generally reviewed, at least annually, to determine the appropriate risk rating. In addition, we evaluate the risk rating during the renewal process of any loan or if a loan becomes past due.

The following table presents loans held for investment for our Commercial Banking segment by internal risk ratings as of September 30, 2025 and December 31, 2024. The internal risk rating status includes all past due loans, both performing and nonperforming.

Table 4.6: Commercial Banking Portfolio by Internal Risk Ratings

	September 30, 2025
	Term Loans by Vintage Year
(Dollars in millions)	2025		2024		2023		2022		2021		Prior		Total Term Loans		Revolving Loans		Revolving Loans Converted to Term		Total
Internal risk rating:(1)
Commercial and multifamily real estate
Noncriticized	$	1,681	$	1,623	$	2,207	$	3,516	$	1,530	$	4,919	$	15,476	$	15,875	$	50	$	31,401
Criticized performing	0		113		83		410		121		947		1,674		31		2		1,707
Criticized nonperforming	10		17		0		22		77		227		353		0		0		353
Total commercial and multifamily real estate	1,691		1,753		2,290		3,948		1,728		6,093		17,503		15,906		52		33,461
Commercial and industrial
Noncriticized	4,743		5,236		5,159		8,183		3,832		7,437		34,590		16,981		126		51,697
Criticized performing	3		191		172		415		787		415		1,983		864		4		2,851
Criticized nonperforming	10		25		12		284		197		234		762		121		0		883
Total commercial and industrial	4,756		5,452		5,343		8,882		4,816		8,086		37,335		17,966