Capital One profit misses estimates, shares fall
(Reuters) - Capital One Financial Corp's (COF.N: Quote) fourth-quarter profit missed analysts' expectations as the company set aside more money to cover defaults on its credit cards, sending its shares down 7 percent after the bell.
The company's credit metrics have deteriorated slightly since it closed its acquisition of HSBC's $30 billion U.S. credit card portfolio in the second quarter.
Capital One's net charge off rate — the percentage of loans written off as unrecoverable — rose more than 50 basis points from the end of the third quarter.
The McLean, Virginia-based company set aside $1.15 billion to cover bad loans in the fourth quarter, up 13.5 percent from the third quarter.
Net income for the fourth quarter rose to $843 million, or $1.41 per share, from $407 million, or 88 cents per share, a year earlier.
Analysts on average expected the lender to earn $1.58 per share, excluding items, according to Thomson Reuters I/B/E/S.
Total net revenue came in at $5.62 billion.
The company said it expects similar quarterly revenue for 2013. Analysts, however, were expecting $5.71 billion in first-quarter revenue.
Capital One expects non-interest expense to average just over $3.1 billion per quarter for this year. Continued...