Capital One 2003 Annual Report Download - page 115

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Securities available for sale
The fair value of securities available for sale was determined using current market prices. See Note C for fair
values by type of security.
Consumer loans
The net carrying amount of consumer loans other than auto loans approximated fair value due to the relatively
short average life and variable interest rates on a substantial number of these loans. This amount excluded any
value related to account relationships.
The fair value of auto loans was estimated by discounting future cash flows using a rate at which a similar
portfolio of loans would be made under current conditions.
Interest receivable
The carrying amount approximated the fair value of this asset due to its relatively short-term nature.
Accounts receivable from securitizations
The carrying amount approximated fair value.
Derivatives
The carrying amount of derivatives approximated fair value and was represented by the estimated unrealized
gains as determined by quoted market prices. This value generally reflects the estimated amounts that the
Corporation would have received to terminate the interest rate swaps, currency swaps and forward foreign
currency exchange (“f/x”) contracts at the respective dates, taking into account the forward yield curve on the
swaps and the forward rates on the currency swaps and f/x contracts. These derivatives are included in other
assets on the balance sheet.
Financial Liabilities
Interest-bearing deposits
The fair value of interest-bearing deposits was calculated by discounting the future cash flows using estimates of
market rates for corresponding contractual terms.
Other borrowings
The carrying amount of federal funds purchased and resale agreements and other short-term borrowings
approximated fair value. The fair value of secured borrowings was calculated by discounting the future cash
flows using estimates of market rates for corresponding contractual terms and assumed maturities when no stated
final maturity was available. The fair value of the junior subordinated capital income securities was determined
based on quoted market prices.
Senior notes
The fair value of senior notes was determined based on quoted market prices.
Interest payable
The carrying amount approximated the fair value of this asset due to its relatively short-term nature.
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