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Capital One Financing Corp. reported a net charge-off rate on its U.S. credit cards of 8.56% of managed receivables last month. Although the annualized rate is 77 basis points lower than the 9.33% in March, much of the decrease is attributable to a change in the manner in which the McLean, Va.-based issuer processes bankrupt accounts. "While our internal guidelines require bankrupt accounts to be charged off within 30 days, our practice had been to charge off customer accounts within two to three days of receiving notification of bankruptcy," according to Cap One's filing today with the U.S. Securities and Exchange Commission. "Due in part to an increase in the volume of bankruptcies, we have extended our processing window to improve the efficiency and accuracy of bankruptcy-related charge-off recognition." The 30-day delinquency rate on Cap One's U.S. cards was 5.04% of receivables in April, down slightly from 5.08% a month earlier.
