Capital One 2005 Annual Report Download - page 87

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Note 5
A
llowance for Loan Losses
he following is a summary of changes in the allowance for loan losses: T
Year Ended December 31
2005 2004 2003
Balance at beginning of year $ 1,505,000
$ 1,595,000 $ 1,720,000
Provision for loan losses 1,491,072
1,220,852 1,517,497
Acquisitions 224,144
— —
Other (12,731) (15,284) 3,863
Charge-offs (1,865,836) (1,749,273) (2,004,328)
Principal recoveries 448,351
453,705 357,968
Net charge-offs (1,417,485) (1,295,568) (1,646,360)
Balance at end of year $ 1,790,000
$ 1,505,000 $ 1,595,000
Loans totaling approximately $422.3 million and $416.9 million, representing amounts which were greater than 90 days past
ue, were included in the Company’ s reported loan portfolio as of December 31, 2005 and 2004, respectively. d
Note 6
Loans
The composition of the loan portfolio was as follows:
December 31
(In Thousands) 2005 2004
Year-End Balances:
Reported loans:
Consumer loans:
Credit cards
$ 16,389,054
$ 16,536,789 Domestic
International 3,356,415 4,017,585
Total credit cards 19,745,469 20,554,374
Installment loans
Domestic 5,763,538 4,475,838
International 551,460 493,846
Total installment loans 6,314,998 4,969,684
Auto loans 18,041,894 9,997,497
Mortgage loans 5,281,009 —
Total consumer loans 49,383,370 35,521,555
Small business loans 6,414,243 2,694,036
Commercial loans 4,050,068 —
Total reported loans $ 59,847,681 $ 38,215,591
As a result of the Gulf Coast Hurricanes, the Company adopted a policy to temporarily defer loan payments for consumer
loans and selected small business and commercial loans to borrowers in the impacted areas. In most cases, the deferred
payments are resulting in the extension of the underlying loan term. The past-due status of any delinquent loan was
effectively frozen at the respective date of each of the hurricanes such that no further payment aging would occur. The
deferral period for the majority of impacted loans is expected to lapse in January 2006. Additionally, the deferral had the
impact of reducing charge-offs and transfers to nonperforming status.
78