Capital One 2010 Annual Report Download - page 146

CAPITAL ONE FINANCIAL CORPORATION
NOTES TO CONSOLIDATED STATEMENTS
126
Consumer Unfunded
Lending
(Dollars in millions) Credit
Card Auto
Home
Loan
Retail
Banking
Total
Consumer Commercial Other(1) Total
Allowance Reserve
Commercial
Combined
Total
Balance as of December 31, 2008 .... $ 2,737 $ 1,102 $ 61 $ 151 $ 1,314 $ 301 $ 172 $ 4,524 $ 0 $ 4,524
Provision for loan and lease losses . .. 2,198 435 198 223 856 919 172 4,145 85 4,230
Charge-offs ......................... (3,334) (1,110) (87) (160) (1,357) (444) (207) (5,342) 0 (5,342)
Recoveries .......................... 499 238 3 22 263 10 2 774 0 774
N
et charge-offs ...................... (2,835) (872) (84) (138) (1,094) (434) (205) (4,568) 0 4,568
Other changes(2) .................... 26 0 0 0 0 (1) 1 26 (85) (59)
Balance as of December 31, 2009 .... $ 2,126 $ 665 $ 175 $ 236 $ 1,076 $ 785 $ 140 $ 4,127 0 4,127
Impact from January 1, 2010 adoption
of new consolidation accounting
standards(3) ........................ 4,244 0 73 0 73 0 0 4,317 0 4,317
Balance as of January 1, 2010 ........ 6,370 665 248 236 1,149 785 140 8,444 0 8,444
Provision for loan and lease losses .... 3,182 145 30 66 241 417 55 3,895 12 3,907
Charge-offs .......................... (6,781) (672) (97) (129) (898) (444) (115) (8,238) 0 (8,238)
Recoveries .......................... 1,282 215 4 24 243 54 8 1,587 0 1,587
N
et charge-offs ...................... (5,499) (457) (93) (105) (655) (390) (107) (6,651) 0 (6,651)
Other changes(2) .................... (12) 0 (73) 13 (60) 14 (2) (60) (12) (72)
Balance as of December 31, 2010 ..... $ 4,041 $ 353 $ 112 $ 210 $ 675 $ 826 $ 86 $ 5,628 $ 0 $ 5,628
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(1) Other consists of our discontinued GreenPoint mortgage operations loan portfolio and our community redevelopment loan portfolio.
(2) Represents the net impact on the allowance and lease losses attributable to acquisitions, sales and other.
(3) Represents the cumulative effect adjustment on the allowance for loan and lease losses from the January 1, 2010 adoption of the new
consolidation accounting standards. Includes an adjustment of $53 million made in the second quarter of 2010 for the impact as of January 1,
2010 of impairment on consolidated loans accounted for as TDRs. See “Note 2—Acquisitions and Restructuring Activities.”
Components of Allowance for Loan and Lease Losses by Impairment Methodology
The table below presents the components of our allowance for loan and lease losses, by loan category and impairment methodology,
and the recorded investment of the related loans as of December 31, 2010:
December 31, 2010
Consumer
(Dollars in millions) Credit
Card Auto
Home
Loan
Retail
Banking
Total
Consumer Commercial Other Total
Allowance for loan and lease losses by
impairment methodology:
Collectively evaluated for impairment . . $ 3,655 $ 353 $ 81 $ 209 $ 643 $ 808 $ 86 $ 5,192
Individually evaluated for impairment . . 386 0 1 1 2 15 0 403
Purchased credit impaired loans ........ 0 0 30 0 30 3 0 33
Total allowance for loan and lease losses $ 4,041 $ 353 $ 112 $ 210 $ 675 $ 826 $ 86 $ 5,628
Held-for-investment loans by
impairment methodology:
Collectively evaluated for impairment . . $ 60,458 $ 17,867 $ 7,154 $ 4,271 $ 29,292 $ 28,682 $ 451 $118,883
Individually evaluated for impairment . . 913 0 57 40 97 500 0 1,510
Purchased credit impaired loans ......... 0 0 4,892 102 4,994 560 0 5,554
Total held-for-investment loans ........ $ 61,371 $ 17,867 $ 12,103 $ 4,413 $ 34,383 $ 29,742 $ 451 $125,947
Allowance as a percentage of period-end
held-for-investment loans ............ 6.58% 1.98% 0.93% 4.76% 1.96% 2.78% 19.07% 4.47%