Capital One’s domestic card business provided strong Q3 earnings results, and continued to pick up momentum, the bank said on Thursday (Oct.24).
The financial institution (FI) said that, as of the end of Q3, the domestic card loans ending balance stood at $104.7 billion, an increase of $1.7 billion. Credit card loans increased 1 percent to $113.7 billion, an increase of $1.5 billion. The bank also reported that non-interest expenses increased 2 percent to $3.9 billion.
For Q3, the bank said provision for credit losses increased 3 percent to $1.4 billion.
During the post-earnings conference call on Thursday, Capital One CEO Richard Fairbank said that, pulling into the third quarter, the company’s domestic card business “continued to deliver strong results and gain momentum.” In terms of the company’s partnership with Walmart, Fairbank said Capital One launched the new Walmart co-brand and private-label cards on Sept. 24. On Oct. 11, the company completed the acquisition of the existing Walmart card portfolio.
“We’re excited to partner with the world’s largest retailer to deliver compelling products and a great, digitally enabled customer experience to Walmart customers,” Fairbank said on the call.
In terms of innovation, Fairbank said, “We remain all-in on our technology transformation, and our progress continues to accelerate.” He noted that the company expects it will complete the exit of four data centers by the end of 2020, which should generate significant cost and efficiency improvements starting in 2021. Until that time, the company will continue to drive for operating efficiency improvement, even with the elevated costs of straddling both the data center and cloud environments.
He added that as the many benefits from the company’s technology transformation continue and increase, “We are well-positioned to succeed in a rapidly changing marketplace, and create long-term shareholder value.”
Capital One said Q3 revenue decreased 2 percent year over year to $7 billion. That was below the $7.2 billion expected by analysts. The bank also reported an earnings per share of $3.32, excluding adjusting items, and that came in higher than analyst expectations of $2.88.
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