Capital One 2004 Annual Report Download - page 116

Download and view the complete annual report

Please find page 116 of the 2004 Capital One annual report below. You can navigate through the pages in the report by either clicking on the pages listed below, or by using the keyword search tool below to find specific information within the annual report.

Page out of 137

  • 1
  • 2
  • 3
  • 4
  • 5
  • 6
  • 7
  • 8
  • 9
  • 10
  • 11
  • 12
  • 13
  • 14
  • 15
  • 16
  • 17
  • 18
  • 19
  • 20
  • 21
  • 22
  • 23
  • 24
  • 25
  • 26
  • 27
  • 28
  • 29
  • 30
  • 31
  • 32
  • 33
  • 34
  • 35
  • 36
  • 37
  • 38
  • 39
  • 40
  • 41
  • 42
  • 43
  • 44
  • 45
  • 46
  • 47
  • 48
  • 49
  • 50
  • 51
  • 52
  • 53
  • 54
  • 55
  • 56
  • 57
  • 58
  • 59
  • 60
  • 61
  • 62
  • 63
  • 64
  • 65
  • 66
  • 67
  • 68
  • 69
  • 70
  • 71
  • 72
  • 73
  • 74
  • 75
  • 76
  • 77
  • 78
  • 79
  • 80
  • 81
  • 82
  • 83
  • 84
  • 85
  • 86
  • 87
  • 88
  • 89
  • 90
  • 91
  • 92
  • 93
  • 94
  • 95
  • 96
  • 97
  • 98
  • 99
  • 100
  • 101
  • 102
  • 103
  • 104
  • 105
  • 106
  • 107
  • 108
  • 109
  • 110
  • 111
  • 112
  • 113
  • 114
  • 115
  • 116
  • 117
  • 118
  • 119
  • 120
  • 121
  • 122
  • 123
  • 124
  • 125
  • 126
  • 127
  • 128
  • 129
  • 130
  • 131
  • 132
  • 133
  • 134
  • 135
  • 136
  • 137

Consumer loans
The net carrying amount of consumer loans other than auto loans and installment loans approximates 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 and installment loans was estimated by discounting future cash flows using a rate at
which similar portfolios of loans would be made under current conditions.
Interest receivable
The carrying amount approximates the fair value of this asset due to its relatively short-term nature.
Accounts receivable from securitizations
The carrying amount approximates fair value.
Derivatives
The carrying amount of derivatives approximates 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
approximates 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 approximates the fair value of this asset due to its relatively short-term nature.
Derivatives
The carrying amount of derivatives approximates fair value and was represented by the estimated unrealized
losses as determined by quoted market prices. This value generally reflects the estimated amounts that the
Company would have paid to terminate the interest rate swaps, currency swaps and f/x contracts at the
93