Capital One FinancialCOF

01Owning a proprietary payment network transforms Capital One from a card issuer paying interchange tolls to Visa/Mastercard into a vertically integrated processor capturing interchange economics on its own rails; migrating legacy Capital One debit volume onto the Discover/PULSE network converts third-party fees into retained margin, creating a structural revenue stream unavailable to any other major card bank without network ownership

02The Discover integration adds a scaled, high-yield unsecured loan book that lifts the consolidated net interest margin above 8%, positioning earnings power materially higher than pre-merger levels as long as credit performance holds

03Allowance for credit losses decreased by $443 million to $23.0 billion as of June 30, 2026 compared to December 31, 2025 primarily driven by an allowance release in our Domestic Card loan portfolio, partially offset by a build in our auto loan portfolio Our allowance coverage ratio decreased by 14 bps to 5.02% as of June 30, 2026 compared to December 31, 2025 primarily driven by favorable credit performance in our Domestic Card loan portfolio The net charge-off rate decreased by 49 bps to 4.71% in Q2 2026 compared to Q2 2025 and decreased by 72 bps to 4.88% in H1 2026 compared to H1 2025 primarily due to favorable observed credit performance

04A CET1 ratio 470 basis points above the regulatory minimum provides a large discretionary buffer for share repurchases; management has deployed that buffer aggressively with $5.2 billion of buybacks in H1 2026, returning excess capital to shareholders while maintaining headroom for macro stress