Capital One Financial in McLean, Va., reported a profit of $1.2 billion in the fourth quarter as improved credit quality and growth in both commercial and consumer loans offset higher expenses.
Earnings per share of $2.48 beat by 9 cents than the mean estimate of analysts compiled by FactSet Research Systems.
Capital One reported a $1.1 billion loss in the fourth quarter of 2017, due to changes in the federal income tax law.
The results from the fourth quarter of 2018 included several one-time items. A benefit related to changes in the tax treatment of rewards costs added 60 cents to earnings. Net gains on the sale of exited businesses add 12 cents. And a higher customer refund reserve in the U.K. cut earnings by 11 cents. Without those items, net income was $884 million, or $1.87 per share.
Net interest income rose 8% to $4.2 billion. The provision for credit losses dropped 15% to $1.6 billion.
Total credit card loans in the U.S. held for investment jumped 2% to $107.4 billion. The net charge-off rate for those loans fell 44 basis points to 4.64%.
Total commercial lending, which includes commercial real estate and commercial and industrial loans, rose 9% to $70.3 billion.
Noninterest income fell 1% to $1.2 billion. Noninterest expense climbed 9% to $4.1 billion on higher marketing and professional services costs.
