Capital One 2000 Annual Report Download - page 61

To Be “Well-
Capitalized”
Minimum For Under Prompt
Capital Corrective
Adequacy Action
Ratios Purposes Provisions
DECEMBER 31, 2000
Capital One Bank
Tier 1 Capital 9.30% 4.00% 6.00%
Total Capital 11.38 8.00 10.00
Tier 1 Leverage 10.02 4.00 5.00
Capital One, F.S.B.
Tier 1 Capital 8.24% 4.00% 6.00%
Total Capital 10.90 8.00 10.00
Tier 1 Leverage 6.28 4.00 5.00
DECEMBER 31, 1999
Capital One Bank
Tier 1 Capital 10.64% 4.00% 6.00%
Total Capital 13.11 8.00 10.00
Tier 1 Leverage 11.13 4.00 5.00
Capital One, F.S.B.
Tier 1 Capital 9.06% 4.00% 6.00%
Total Capital 10.69 8.00 10.00
Tier 1 Leverage 8.08 4.00 5.00
In August 2000, the Bank received regulatory approval and
established a subsidiary bank in the United Kingdom. In connection
with the approval of its former branch office in the United Kingdom,
the Company committed to the Federal Reserve that, for so long as
the Bank maintains a branch or subsidiary bank in the United King-
dom, the Company will maintain a minimum Tier 1 Leverage ratio of
3.0%. As of December 31, 2000 and 1999, the Company’s Tier 1
Leverage ratio was 11.14% and 12.79%, respectively.
Additionally, certain regulatory restrictions exist that limit the
ability of the Bank and the Savings Bank to transfer funds to the Cor-
poration. As of December 31, 2000, retained earnings of the Bank
and the Savings Bank of $209,000 and $35,900, respectively, were
available for payment of dividends to the Corporation without prior
approval by the regulators. The Savings Bank, however, is required
to give the OTS at least thirty days advance notice of any proposed
dividend and the OTS, in its discretion, may object to such dividend.
Note K
COMMITMENTS AND CONTINGENCIES
As of December 31, 2000, the Company had outstanding lines of
credit of approximately $87,500,000 committed to its customers.
Of that total commitment, approximately $58,000,000 was unused.
While this amount represented the total available lines of credit to
customers, the Company has not experienced, and does not antici-
pate, that all of its customers will exercise their entire available line
at any given point in time. The Company generally has the right to
increase, reduce, cancel, alter or amend the terms of these available
lines of credit at any time.
Certain premises and equipment are leased under agreements
that expire at various dates through 2015, without taking into con-
sideration available renewal options. Many of these leases provide
for payment by the lessee of property taxes, insurance premiums,
cost of maintenance and other costs. In some cases, rentals are
subject to increase in relation to a cost of living index. Total
expenses amounted to $66,108, $37,685 and $18,242 for the
years ended December 31, 2000, 1999 and 1998 respectively.
Future minimum rental commitments as of December 31,
2000, for all non-cancelable operating leases with initial or remain-
ing terms of one year or more are as follows:
2001 $ 54,439
2002 56,930
2003 50,928
2004 33,467
2005 29,146
Thereafter 88,056
Total $ 312,966
In December 2000, the Company entered into a 10-year agree-
ment for the lease of a headquarters building being constructed in
McLean, Virginia. Monthly rents will commence upon completion,
which is expected in December 2002. The Company guarantees a
residual value of up to approximately 72% of the estimated $159,500
cost of the buildings in the lease agreement.
notes 59