Capital One, is still a walking zombie that pretends it isn't, and the charge off rates on their cards continues to go up. January's charge off rate was 7.82%, up from 7.71% in December.
Capital One has been jacking up card rates, and then only belatedly, recognizing income they have accrued as unearned.
At least that way, they can try and manage their fictitious honey pot! Especially if the card rates go up, the pot size increases! From today's SEC filing:
When we do not expect full payment of finance charges and fees, we do not accrue the estimated uncollectible portion as income. The estimated uncollectible portion of finance charges and fees is adjusted quarterly.
One Capital one's Septemebr 30, we had this line item.
Income statement adjustments for the three months ended September 30, 2008 reclassify the net of finance charges of $1,369.0 million, past due fees of $240.8 million, other interest income of $(35.3) million and interest expense of $491.8 million; and net charge-offs of $711.4 million to non-interest income from net interest income and provision for loan and lease losses, respectively.
For 2007, we had this:
Income statement adjustments for the year ended December 31, 2007 reclassify the net of finance charges of $6,334.8 million, past due fees of $1,004.1 million, other interest income of $(167.3) million and interest expense of $2,681.7 million; and net charge-offs of $2,201.5 million to non-interest income from net interest income and provision for loan losses, respectively.
At least Capital One has one area with growth!