Capital One 2008 Annual Report Download - page 166

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148
As of December 31, 2008, the Banks each exceeded the minimum regulatory requirements to which it was subject. The Banks all were
considered well-capitalized under applicable capital adequacy guidelines. Also as of December 31, 2008, the Corporation was
considered well-capitalized under Federal Reserve capital standards for bank holding companies and, therefore, exceeded all
minimum capital requirements. There have been no conditions or events since that we believe would have changed the capital
category of the Corporation or either of the Banks.
Regulatory
Filing
Basis
Ratios
Applying
Subprime
Guidance
Ratios
Minimum for Capital
Adequacy Purposes
To Be Well Capitalized
Under
Prompt Corrective Action
Provisions
December 31, 2008
Capital One Financial Corp.(1)
Tier 1 Capital .......................................................... 13.76% 12.76% 4.00% N/A
Total Capital ........................................................... 16.60 15.48 8.00 N/A
Tier 1 Leverage....................................................... 11.13 11.13 4.00 N/A
Capital One Bank (USA) N.A.
Tier 1 Capital .......................................................... 13.02% 9.99% 4.00% 6.00 %
Total Capital ........................................................... 15.65 12.26 8.00 10.00
Tier 1 Leverage....................................................... 11.79 11.79 4.00 5.00
Capital One, N.A.
Tier 1 Capital .......................................................... 10.54% N/A 4.00% 6.00 %
Total Capital ........................................................... 11.86 N/A 8.00 10.00
Tier 1 Leverage....................................................... 7.85 N/A 4.00 5.00
December 31, 2007
Capital One Financial Corp.(1)
Tier 1 Capital .......................................................... 10.13% 9.49% 4.00% N/A
Total Capital ........................................................... 13.05 12.29 8.00 N/A
Tier 1 Leverage....................................................... 9.00 9.00 4.00 N/A
Capital One Bank
Tier 1 Capital .......................................................... 13.48% 10.45% 4.00% 6.00 %
Total Capital ........................................................... 16.57 13.06 8.00 10.00
Tier 1 Leverage....................................................... 12.81 12.81 4.00 5.00
Capital One, N.A.
Tier 1 Capital .......................................................... 10.75% N/A 4.00% 6.00 %
Total Capital ........................................................... 12.11 N/A 8.00 10.00
Tier 1 Leverage....................................................... 8.37 N/A 4.00 5.00
Superior Bank(2)
Tier 1 Capital .......................................................... 15.07% N/A 4.00% 6.00 %
Total Capital ........................................................... 16.33 N/A 8.00 10.00
Tier 1 Leverage....................................................... 6.71 N/A 4.00 5.00
(1) The regulatory framework for prompt corrective action is not applicable for bank holding companies.
(2) During 2008, Superior Bank merged with and into CONA
COBNA treats a portion of its loans as subprime under the Guidelines issued by the four federal banking agencies that comprise the
Federal Financial Institutions Examination Council (FFIEC), and has assessed its capital and allowance for loan and lease losses
accordingly. Under the Guidelines, COBNA exceeds the minimum capital adequacy guidelines as of December 31, 2008.
For purposes of the Guidelines, the Corporation has treated as subprime all loans in COBNAs targeted subprime programs to
customers either with a FICO score of 660 or below or with no FICO score. COBNA holds on average 200% of the total risk-based
capital charge that would otherwise apply to such assets. This results in higher levels of regulatory capital at COBNA.
Additionally, regulatory restrictions exist that limit the ability of COBNA and CONA to transfer funds to the Corporation. As of
December 31, 2008, retained earnings of COBNA and CONA were $239.3 million and zero million, respectively. The retained
earnings of COBNA are available for payment as dividends to the Corporation without prior approval of the OCC while a dividend
payment by CONA would require prior approval of the OCC.