IMGCAP(1)]
Capital One Financial Corp. today reported that its U.S. Card segment's net charge-off rate increased to 6.34% of card receivables in September from 5.96% in August, and its 30-day delinquency rate rose to 4.2% in September from 4.07% a month earlier. Cap One plans to release third-quarter earnings tomorrow. Richard D. Fairbank, Cap One chairman and CEO, told analysts in mid-July he expected the company's charge-off rate to reach the low-6% range in the third quarter then rise to about 7% in the fourth quarter. "We've observed continued weakening in economic indicators throughout the first half of the year," he said at the time. Charge-off and delinquency rates for U.S. credit card issuers are up this year as the U.S. economy falters. Elsewhere, the net charge-off rate in Cap One's international business rose to 5.87% of total receivables in September from 5.31% in August, and the 30-day delinquency rate rose to 5.24% from 5.15%. Cap One once focused on credit cards but has expanded into branch banking in recent years with the acquisition of Hibernia Corp. and North Fork Bancorp Inc. Fairbank noted that credit card delinquencies longer than 30 days during the second quarter ended June 30 improved from roughly 4% during the first quarter of this year, which he attributed to new pricing and fee-policy changes Cap One introduced during the second half of last year.
