CapOne Strategy Business Review

Debt & Equity 2006Strategy Presentation

Rich Fairbank

February 16, 2006

Debt & Equity Conference – February, 2006 2

Forward looking statements

Forward-Looking Information

Please note that the following materials containing information regarding Capital One’s financial performance speak only as of the particular date or dates indicated in these materials. Capital One does not undertake any obligation to update or revise any of the information contained herein whether as a result of new information, future events or otherwise.

Certain statements in this presentation and other oral and written statements made by the Company from time to time, are forward-looking statements, including those that discuss strategies, goals, outlook or other non-historical matters; or project revenues, income, returns, earnings per share or other financial measures for Capital One. To the extent any such information is forward-looking, it is intended to fit within the safe harbor for forward-looking information provided by the Private Securities Litigation Reform Act of 1995. Numerous factors could cause our actual results to differ materially from those described in forward-looking statements, including, among other things: continued intense competition from numerous providers of products and services which compete with our businesses; an increase ordecrease in credit losses; financial, legal, regulatory or accounting changes or actions; changes in interest rates; general economic conditions affecting consumer income, spending and repayments; changes in our aggregate accounts or consumer loan balances and the growth rate and composition thereof; the amount of deposit growth; changes in the reputation of the credit card industry and/or the company with respect to practices and products; our ability to continue to securitize our credit cards and consumer loans and to otherwise access the capital markets at attractive rates and terms to fund our operations and future growth; our ability to successfully continue to diversify our assets; losses associated with new products or services or expansion internationally; the company’s ability to execute on its strategic and operational plans; any significant disruption in our operations or technology platform; our ability to effectively control our costs; the success of marketing efforts; our ability to execute effective tax planning strategies; our ability to recruit and retain experienced management personnel; the risks that the Hibernia businesses will not be integrated successfully and that the cost savings and other synergies from the transaction may not be fully realized; the long-term impact of the Gulf Coast Hurricanes on the impacted region, including the amount of property and credit losses, the amount of investment, including deposits, in the region, and the pace and magnitude of economic recovery in the region; and other factors listed from time to time in reports we file with the Securities and Exchange Commission (the “SEC”) , including, but not limited to, factors set forth under the caption “Risk Factors” in our Annual Report on Form 10-K for the year ended December 31, 2004, and any subsequent quarterly reports on Form 10-Q. You should carefully consider the factors discussed above in evaluating these forward-looking statements. All information in these slides is based on the consolidated results of Capital One Financial Corporation. A reconciliation of any non-GAAP financial measures included in this presentation can be found in the Company’s most recent Form 8-K or Form 10-Q concerning quarterly financial results, available on the Company’s website at www.capitalone.com in Investor Relations under “About Capital One.”

.


$0

$1

$2

$3

$4

$5

$6

$7

$8

1994

1995

1996

1997

1998

1999

2000

2001

2002

2003

2004

2005

Capital One has generated strong growth and returns since the IPO in 1994

$0

$20

$40

$60

$80

$100

$120

1994

1995

1996

1997

1998

1999

2000

2001

2002

2003

2004

2005

Managed Loans$B

EPS

$105.5B$6.73

$


SkillsGeographies ChannelsProducts Brand

• Auto lending

• Small business

• Home equity

• Installment lending

• Medical finance

• Banking and deposits

• UK

• Canada

• Internet

• Dealers

• Stores

• Branches

• Mergers and acquisitions

• Personal selling

From a core business of credit cards, direct mail and IBS, we have transformed the company


We are diversifying both sides of the balance sheet

$0

$20

$40

$60

$80

$100

$120

2001 2002 2003 2004 2005

Managed Outstandings

GlobalFinancial Services

($B)

Auto Loans

U.S. Credit Cards

Other(Includes Hibernia)

$47.9

$25.6

$22.4

$2.0$3.8

$8.4

$12.8

$17.3

$0

$5

$10

$15

$20

$25

$30

$35

$40

$45

$50

1998

1999

2000

2001

2002

2003

2004

2005

Total Deposits($B)

$45

$60

$71

$80

$105.5


End Game PositioningStability Growth

Opportunities

We are well positioned for continued success

Financial Strength


Our strategy works backward from the marketplace

Market end game

• National Scale Lending

• Local Scale Banking

• Diversified assets and liabilities

• Advantaged customer accessWhere they buy (channels)In their wallet (relationships)In their hearts and minds (brand)


Consumer lending businesses are consolidating nationally

89%

66%61%

55%

42%

22%16%

0%

10%

20%

30%

40%

50%

60%

70%

80%

90%

100%

Card Home Equity Mortgage Student Auto InstallmentLoans

Small BusinessLending

Top 10 Player Share - 2004

FragmentedConsolidatingConsolidated

Note: Share of originations for Home Equity, Mortgage, Student, Auto; Share of Outstandings for Card, IL, Small Business

Source: Company Reports, VISA, Masterard, SMR, Mortgage News, Department of Education, JDPower, Capital One Estimates


The pace of consolidation is rapid

Card

Home Equity

Auto

Mortgage

0%

10%

20%

30%

40%

50%

60%

70%

80%

90%

100%

1997 1998 1999 2000 2001 2002 2003 2004

Industry Consolidation- Share of Top 10 -

Student

21%31%

43%

62%

41%

Note: Share of originations for Home Equity, Mortgage, Student, Auto; Share of Outstandings for Card, IL, Small Business

Source: Company Reports, VISA, Masterard, SMR, Mortgage News, Department of Education, JDPower, Capital One Estimates

42%

66%

89%

55%

61%


First MerchantsSearch FinancialThe Money StoreWestern FidelityAegisRelianceNational AutoMonacoEagleJayhawkNational Auto Finance TFC enterprisesFirst EnterpriseMercuryAamesIownFinovaDelta FinancialThe Credit Store NAL Financial Royal Acceptance Commercial Financial ServicesNextCardDVI

Dead

IndyMacCountrywide AmericreditSallie Mae NelnetFirst MarbleheadConsecoNicholasCompuCredit

Existing Monolines

Consumer lending monolines

ArcadiaUgly Duckling BeneficialFirst USA Rock FinancialAdvantaReliastarAutofinance GroupFirst FidelityFirst InvestorsMS FinancialRegional AcceptanceHeller FinancialGreenTreeHouseholdOnyxProvidianMBNAWFS FinancialMetris

Acquired

The monoline graveyard is crowded

Note: Yellow indicates companies acquired in 2005


National scale players compete across multiple consumer lending businesses

Chase

B of A / MBNA

Citigroup

Wells Fargo

Capital One**

Washington Mutual

Countrywide

Company

Card(Outstandings

Rank)

2

1

3

10

4

9

--

2

1

3

6

20

5

4

Home Equity*

Auto(Non-captive)

1

3

12

5

2

--

--

4

6

7

2

68*

3

1

Mortgage

2005 Originations Rank

Source: Company Reports, VISA, Mastercard, SMR, Mortgage News, JDPower, Capital One Estimates*Data as of 2Q2005. **Capital One Mortgage includes HIB and eSmartloan. Auto includes Onyx and Hibernia. 1 – Estimate based upon $2.5B of FY2005 Originations. 2 – Estimate based upon $24.1B of FY2005 originations.


Deposits are the primary funding source for most lending products

0%

10%

20%

30%

40%

50%

60%

70%

80%

90%

100%

Card Mortgage Auto HomeEquity

SmallBusiness

InstallmentLoans

2004 Funding Mix

Deposits and other funding

Securitized

Note: Mortgage, Auto and Home Equity are as a % of originations; Card Small Business and IL are as a % of outstandingsOriginations are classified as funded through securitizations, even if they were initially whole loan sold.Source: CSFB; Bond Market Association; MBAA; Visa/Mastercard; Big Wheels. Small Business and IL COF estimated


$200 $300 $400 $500 $600

National deposit players do not exhibit cost advantages

Efficiency Ratio vs. Total Deposits

Note: Efficiency ratio = non-interest expense/revenue; Excludes banks with efficiency ratio >100%, 2004 dataSource: SNL.

Worse

Better

BofA

Citi

JPChase

Wachovia

Wells Fargo

Total Deposits ($B)

USBancorp

0%

10%

20%30%

40%

50%

60%

70%80%

90%

100%

$0 $10 $20 $30 $40 $50 $60 $70 $80 $90 $100 $110 $120

Hibernia


Local scale is critical in deposits

0%

5%

10%

15%

20%

25%

0% 5% 10% 15% 20% 25%

June 2005 - Top 25 MSAs

Branch Share**

* Excludes estimated corporate and other non-traditional deposits by excluding balances in excess of $200MM deposits for any individual branch. ** Counts all in-store and mobile branches as ¼ of a traditional branch.Source: SNL

Deposit %Branch % 0.9 1.0 1.2

Retail Deposit Share*


Branch banking is consolidating more slowly

Card

Home Equity

Auto

Mortgage

0%

10%

20%

30%

40%

50%

60%

70%

80%

90%

100%

1997 1998 1999 2000 2001 2002 2003 2004

Industry ConsolidationShare of Top 10

Student

Deposits29%

Note: Share of originations for Home Equity, Mortgage, Student, Auto; Share of Outstandings for Card, IL, Small BusinessSource: Company Reports, VISA, Mastercard, SMR, Mortgage News, Department of Education, JDPower, Capital One Estimates

35%


-4.2%

-1.2%

0.0%

1.1%

4.4%

-5.0%

-4.0%

-3.0%

-2.0%

-1.0%

0.0%

1.0%

2.0%

3.0%

4.0%

5.0%

1-5 6-10 11-20 21-30 31+

*Excludes estimated corporate and other non-traditional deposits by capping balances at $200M deposits for any individual branchNote: Acquisitions completed to date have been applied retroactively to previous years. Source: SNL.

2000 – 2005 Change in Retail Deposit* Market ShareTop 20 US MSAs by 2005 retail deposits

‘05 Share 14.5% 6.1%12.4%52.0% 15.1%

The share gains of small banks is a reminder that there is a lot more to banking than scale

‘00 Share 15.8% 5.0%12.4%56.2% 10.7%

CAGR 4.0% 9.8%5.8%4.1% 13.2%

Rank


14%

32%

83%

0%

20%

40%

60%

80%

100%

SB Card (Outstandings) SBA Loans (Originations) Other SB Lending(Outstandings)

2004 Estimated Share Among Top 10 Players

$50 $433 $980 EstimatedMarket Size ($B):

2 11

Source: FRB, SBA, MNW, SMR, NFO, HEW, SNL, Visa/MC, AXP, Earnings ReleasesNotes: 1) Card O/S and Other SB Lending O/S figures are rough estimates given general reporting requirements and mix of credit and charge card balances. Card O/S includes business card and personal cards for business use. Other SB Lending Includes IL/LOC, Real Estate, Equipment loans and leasing, Vehicle, other asset-backed loans, and owner loans (including HELOCS) 2) SBA Loans represents Top 10 for 7(a) lenders only 3) SBA Loan market size as of 9/30/2004

Most Small Business banking remains local


Card* 77% -- 8% 15%

Mortgage 5% 58% -- 37%

Home Equity 23% 17% -- 60%

Auto 5% -- 80% 15%

Student 7% -- 93% --

Small Business** 4% 4% 10% 82%

Bank Deposits 2% 7% -- 91%

Total 7% 28% 8% 57%

Despite banks’ best efforts, consumers resist single channels of distribution

Source: Inside Mortgage Finance, SMR, SNL, HEW, JD Power, CNW

2004 Percent Origination By Channel

*Card Outstandings

Point of SaleDirect BranchBroker

Meet customers where they are**Small Business includes Small Business Card and Vehicle Lending


As businesses go national, a few banks have built large customer bases

1. Citi*

2. Bank of America/MBNA**

3. JPM Chase*

4. Discover

5. Capital One

6. Wells Fargo

7. WaMu / Providian

8. USBancorp*

9. Wachovia

10. Fifth Third

200 M

105 M

90 M

50 M

49 M

23 M

23 M

13 M

11 M

6 M

2005 Customer Accounts

Source: Company reports. SEC Filings. All figures include domestic and international customers (if applicable).* Figures based on 2004 Annual Reports of total company customer base as of year-end 2004 (Domestic and International)** Includes 2006 disclosure of Bank of America customer base plus Q2 2005 Cardweb estimate for MBNA


A handful of banks are investing in national brands

Total Brand Awareness (%)

98

97

64

50

95

81

73

97

95

Question: “When you think about companies or banks that offer financial services products such as checking accounts, various types of savings

accounts, credit cards and loans, which ones come to mind?”

Source: Millward Brown Financial Services Brand Health Wave. January, 2006



Establishend game positions

Leverage consolidation

for growth

Choose the right

businesses

Market end game




• Advantaged customer access

Where they buy (channel)In their wallet (relationships)In their hearts and minds (brand)

• National scale lending consolidation

• Local scale banking consolidation

• Secure end-game positions in chosen businesses before they consolidate

• Preserve doublings

• Structurally attractive (above hurdle at end game)

• Don’t need to be everywhere, but must be diversified

Secure advantaged

access to customers

• National brand

• National customer base

• Meet customers where they are

Execute at the right level

• Compete nationally in national businesses

• Compete locally in local businesses

How to createlong-term value


Capital One is well positioned in consumer financial services

US Card GFSAuto

Local Banking Customer Access

• # 4 Issuer • # 2 non-captive originator

• # 2 small business card issuer

• # 3 SBA loan originator

• # 20 home equity originator

• # 7 UK card issuer

• #1 Louisiana bank*

• #12 Texas bank*

• Successful de novo model

• 49M accounts

• Leading brand

• Every channel

National Lending

Note: Texas and Louisiana ranks are based on state deposit rank as of 6/30/2005.

Source: SNL

Debt Equity 2006Business Overview

Rich Fairbank

February 16, 2006



US Card GFSAuto

Local Banking Customer AccessNational Lending

Debt & Equity Conference – February, 2006 25Source: VISA, MasterCard, AmEx, Discover. 2005 estimated based on Q4 2005 reporting companies.

The credit card industry has consolidated

% of Credit Card Outstandings

37%57%

73%17%

20%

17%46%

23%10%

0%10%20%30%40%50%60%70%80%90%

100%

1994 1999 2005

Top 5 providers

Next 5 providers

All others


6%

3%

21%

7%

13%

11%

0%

5%

10%

15%

20%

25%

Card Auto HomeEquity

SmallBusiness

Student Mortgage

The card industry is still among the most attractive in financial services

2.0%

1.2%1.1%

0.9% 0.9%

0.5%

0%

1%

2%

3%

Card Auto HomeEquity

SmallBusiness

Student Mortgage

Estimated Industry After-Tax ROA*

Annual Industry OutstandingsGrowth Rate (2000-2004)

Source: JDPower, SMR, Visa/Mastercard, SBA, National Mortgage News, Department of Education, SNL, Company Reports * Industry ROAs taken from representative companies / Industry monolines


We see several key industry risks

• Economy

• Competitive intensity

• Industry pricing practices– Long-teasers and repricing

• Erosion from substitute products– Home equity, debit cards

• Interchange


Capital One’s U.S. Card business is delivering strong profit growth

1,609

1,387

1,182

1,001

774

515

690

$0

$200

$400

$600

$800

$1,000

$1,200

$1,400

$1,600

$1,800

1999 2000 2001 2002 2003 2004 2005

COF U.S. Card NIAT$M

Growth 34% 12% 29% 18% 17% 16%


Our outstandings growth has slowed

COF U.S. Card Outstandings

$15.5

$23.1

$33.0

$40.9

$46.3$48.6 $49.5

$0

$15

$30

$45

$60

1999 2000 2001 2002 2003 2004 2005

$B

Growth 49% 43% 2%24% 13% 5%

Organic Outstandings Growth

American Express (Total Card) 15%

WaMu/Providian (U.S. Card) 8%

MBNA (Total Company) 5%

Bank of America (U.S. Card) 4%

JPM Chase (Card Services) 3%

Capital One (U.S. Card) 2%

Discover (U.S. Card) -3%

Citigroup (U.S. Card) -4%

’04-’05

Source: Company Reports


As the industry has matured, competitors are offering aggressive headline pricing and teasers

72%

81%86% 86%

83%86%

0%

20%

40%

60%

80%

100%

2000 2001 2002 2003 2004 2005

5.86.2

8.48.9

10.4

12.3

0

2

4

6

8

10

12

14

2000 2001 2002 2003 2004 2005

Industry % Mail with Teasers(Excludes COF)

Industry Average Teaser Length (Excludes COF)

Source: Capital One Analysis NOTE: Average Teaser Length is calculated only for BT and Purchase Teasers with the same lengths

Months


Aggressive teasers are not good long-term business

100

87

32

26

0

20

40

60

80

100

Response Rate(Indexed to rewards)

0

1

2

3

4

5

6

Rewards Low Price (No-teaser, No rewards)

Medium-length Teaser

Long Teaser Rewards Low Price (No-teaser, No rewards)

Medium-length Teaser

Long Teaser

Retention of peak balance at month 24(Indexed to rewards)

1.2X

2.6X

5.3X

1X

Source: Capital One Analysis


Capital One is staying out of the aggressive teaser business

Chase 94%

Citibank 86%

Discover 86%

Bank of America 72%

Washington Mutual/Providian 61%

MBNA 58%

HSBC 52%

American Express 19%

Capital One 8%

2005 % Mail Volume with 0% Balance Transfer Teasers

Source: Compremedia


Rewards cards have become a major force in the card business

48%44%

40%

33%

0%

10%

20%

30%

40%

50%

60%

70%

80%

90%

100%

2002 2003 2004 Q32005

79%73%

69%63%

0%

10%

20%

30%

40%

50%

60%

70%

80%

90%

100%

2002 2003 2004 Q32005

Industry Rewards as % of Total Purchase VolumeIndustry Rewards as % of Total Cards

Source: VISA


We are competing with uniquely positioned rewards offers

• Fly on ANY airline

• No blackout dates

• Redeem for travel, cash and merchandise

• Low APR

• No annual fees


Our rewards programs are driving purchase volume growth

Purchase Volume Growth

Capital One (U.S. Card) 16%

American Express (Total Card) 16%

Bank of America / MBNA 16%

WaMu/Providian (U.S. Card) 12%

JPM Chase (Card Services) 7%

Citigroup (U.S. Card) 5%

Discover (U.S. Card) 4%

’04-’05

COF U.S. Card Purchase Volume$B

$18.1

$30.8

$45.9

$58.1 $58.1

$64.0

$73.7

$0

$10

$20

$30

$40

$50

$60

$70

$80

1999 2000 2001 2002 2003 2004 2005

70% 49% 16%27% 0% 10%Growth

*Bank of America / MBNA based upon MBNA actuals and BofA/MBNA estimate.Source: Nilson, Company Reports


Industry mail response rates continue to decline

0.0%

0.2%

0.4%

0.6%

0.8%

1.0%

1.2%

1.4%

1.6%

1995 1996 1997 1998 1999 2000 2001 2002 2003 2004 2005

0.28%

1.39%

U.S. Credit Card Industry Direct Mail Response Rate

Source: Compremedia


Non-mail channels are emerging in Card

56%

30%

14%

0%

10%

20%

30%

40%

50%

60%

Direct mail Non-Mail / Non-Internet*

Internet

Channel that Customers First Heard About Their Credit Card

Source: Forrester Ultimate Consumer Panel, June 2005. BCG Analysis* Includes Telephone, Branch, Media Ad and Tabling/Events


0

1

2

3

4

Capita

l One Citi

Discove

r

JPM

organ

/ Ban

k One

Amer

ican

Expr

ess

Prov

idian

HSBC

We are well positioned on the Internet

0

4

8

12

16

20

BofA

JPCh

ase

Capi

tal O

ne Citi

HSBC

Well

s Far

goAm

Ex

Wac

hovia IN

G

ETra

de

Source: Netratings*Week ending December 25th, 2005

2005 Average Unique Monthly Online Visitors(All Financial Services)

Top Online Credit Card Destinations(Weekly Audience)*

Millions

3.7

Millions

12.7


Our charge-off rate is among the best

*Providian FY2005 charge-off rate based upon estimate of 3Q2005 average outstandings. Company did not report Q32005 financial results.

Managed Charge-off Rate

Q4 2005

6.61%

5.92%

5.70%

5.76%

4.60%

5.02%

FY 2005

Citigroup (US Card) 5.79%

MBNA (Total Company) 4.49%

Capital One (US Card) 5.00%

Discover 5.23%

American Express (US Card) 4.13%

Well Fargo (US Card) 4.38%

9.49%Bank of America (US Card) 6.85%

JPMorgan Chase (Total Card)

7.28%

6.39%

7.81%

5.21%

Providian (Total Card)*


Our portfolio mix is comparable with that of other leading players

660-720<660**

% of Trust Receivables by FICO Score*

31%

35%

34%

31%

28%

26%

750+700-750<650**

20%30%22%

650-700

28%

Capital One

MBNA

Citibank

JPMorgan/Chase

720+

39%

37%

40%

* Data taken from January, 2006 Credit Card Trust Prospectuses. JPM Chase from February, 2006. **Includes “No Score”


Our U.S. Card business has consistently delivered strong returns

After-tax return on managed loans

20042003 2005

2.6%

3.1%

1.4%

1.7%

2.2%

2.6%

N/A

1.3%

1.4%

2.1%

Citigroup Card 2.0%

Bank of America Card 2.6%

JPM Chase Card 1.4%

Discover 1.2%

MBNA (Total Company) 1.5%

3.0%2.9%Capital One (US Card) 3.4%



Our historical strengths are valuable in a maturing card industry

IBS

Credit Risk Management

De-averaging Economics

Targeted Marketing

Optimizing Customer

Relationships

Testing and Innovation



US Card GFSAuto



21%

13%11%

7% 6%

3%

0%

5%

10%

15%

20%

25%

HomeEquity

Student Mortgage SmallBusiness

Card Auto

Auto finance is the slowest growing consumer lending business

Annual Outstandings Growth Rate (2000-2004)

Total 2004 Outstandings

$720B $200B $655B$7.5T $1.1T $1.2T

Source: Company Reports, VISA, Mastercard, SMR, Mortgage News, Department of Education, JDPower, Capital One Estimates


Captive finance companies have a significant share of the market

38%

57%

34%

49%

0%

10%

20%

30%

40%

50%

60%

Q1 99 Q3 99 Q1 00 Q3 00 Q1 01 Q3 01 Q1 02 Q3 02 Q1 03 Q3 03 Q1 04 Q3 04 Q1 05 Q3 05

Captive Share of Loan Originations(New + Used)

Source: Power Information Network, a Division of J. D. Power and Associates

Note: Franchised dealers only


The industry is consolidating

21%25%

31%29%

37%

42% 43%

0%

5%

10%

15%

20%

25%

30%

35%

40%

45%

1999 2000 2001 2002 2003 2004 2005

Top 10 Player Share of Non-Captive Originations

Source: Power Information Network, a Division of J. D. Power and Associates

Note: Franchised dealers only

Growth 15% 7% 0% 41% 14% 13%


7.8%

6.4% 6.3%

4.8%4.1%

0%

1%

2%

3%

4%

5%

6%

7%

8%

9%

Chase COAF B of A WFS /Wachovia

Wells Fargo

We are the #2 non-captive auto lender

Share of Non-Captive Auto Loan Originations - 2005

Notes: COAF include COAF Dealer and direct channel, ONXY and Hibernia; Wells Fargo includes WFFA and Wells Fargo Bank. Direct lendingdone by other lenders on this chart is not shown as the data is not available. Franchised dealers onlySource: Power Information Network, a Division of J. D. Power and Associates


$B

$0

$2

$4

$6

$8

$10

$12

2000 2001 2002 2003 2004 2005

$0.9

$2.9

$6.4 $6.6

$0

$2

$4

$6

$8

$10

$12

$14

$16

$18

2000 2001 2002 2003 2004 2005

$10.2

$8.5

$4.5

$1.2

Source: Company reports

$6.7$11.0

$B

Capital One Auto Finance is delivering strong growth

COF Auto Originations COF Auto Outstandings

$10.4

$17.6

Note: Above Data does not include Hibernia. Outstanding: Serviced outstandings


($23) ($21)($35)

$10

$132

$164

$99

($50)

$0

$50

$100

$150

$200

1999 2000 2001 2002 2003 2004 2005

COF Auto Net Income$M

Capital One Auto Finance is generating strong earnings


$0

$2

$4

$6

$8

$10

$12

$14

$16

$18

$20

1998 1999 2000 2001 2002 2003 2004 2005

PeopleFirst & COF DirectPlatform

COAF’s growth has come from successfully ramping up growth platforms

COF Auto Outstandings

Onyx Dealer Platform

Summit Dealer Platform

$B


We are growing across the credit spectrum

$0

$2

$4

$6

$8

$10

$12

2000 2001 2002 2003 2004 2005

Non-Prime

Prime

$0.9

$2.9

$6.4 $6.6 $6.7

$10.4

COF Auto Originations$B


We have delivered strong credit performance

0%

2%

4%

6%

8%

10%

12%

14%

16%

0 4 8 12 16 20 24 28 32 36 40 44 48 52 56 60 64 68 72

0%

2%

4%

6%

8%

10%

12%

14%

16%

1 4 7 10 13 16 19 22 25 28 31 34 37 40 43 46 49

COF Auto Cumulative Net $ Charge-OffsDealer Non-Prime Direct Prime / Superprime

1998

1999

2000

2001

2002

2003

2004

Q12005

COF Auto Cumulative Net $ Charge-Offs

Months since booking Months since booking


We have significantly expanded our dealer network

8% 10% 14% 24% 39% 42% 51% 73%

Note: Dealers include franchised and independent dealers that fund with Capital One

% of Franchised

Dealers

1,871 2,2533,131

5,384

8,4139,169

11,103

18,701

0

2,000

4,000

6,000

8,000

10,000

12,000

14,000

16,000

18,000

20,000

1998 1999 2000 2001 2002 2003 2004 2005

Dealers


We see continued growth opportunities

Geographic Expansion

Full Credit Spectrum

Penetration of Individual Dealers

Expansion of Direct Channel

Mostly done

Continued penetration upmarket

Lots of upside

Internet

Cross-sell

Partnerships



US Card GFSAuto



Global Financial Services houses several emerging growth plays for COF

GFS

US International

• Small Business

• Home Loans

• Installment Loans

• Point of Sale / Healthcare Finance

• UK

• Canada


We are a significant player in the UK and Canada

Outstandings

$0

$2

$4

$6

$8

$10

$12

2000 2001 2002 2003 2004 2005

UK - #7 card player

Canada - #8 card player

Growth 34% 33% 45% 41% 1%

$B

Weighted Average Growth in local currency 40% 24% 28% 32% 9%

Source: Company Reports, Securitizations and Capital One estimates


The nature of the UK market made it vulnerable to a consumer lending downturn

Source: Economy.com, Bank of England, HM Treasury, Mortgage Bankers Association, National Mortgage News, COF estimatesNote: 1) Household Debt Service Ratio equates to the % of HH disposable income spent on servicing debt (principal and interest)

Variable Rate Mortgages as % of Total Mortgage Outstandings

(2004, by value)

63%

25%

0%

10%

20%

30%

40%

50%

60%

70%

UK US

Household Debt Service Ratio1

0%

5%

10%

15%

20%

25%

Mar

99

Sep

99

Mar

00

Sep

00

Mar

01

Sep

01

Mar

02

Sep

02

Mar

03

Sep

03

Mar

04

Sep

04

Mar

05

Sep

05

UK

US


0%

1%

2%

3%

4%

5%

6%

7%

8%

9%

Jan-04 Mar-04 May-04 Jul-04 Sep-04 Nov-04 Jan-05 Mar-05 May-05 Jul-05 Sep-05 Nov-05

EGG

MBNA*

Morgan Stanley

Barclays

Source: JP Morgan

Capital One

* MBNA’s loss number is based on its De-linked series. In Sept 2005, it differed from the loss number reported for its linked series because of new De-linked series issuance impacting the loss calculation.

The Capital One portfolio has been impacted

Gross Charge-offs of UK Card Players


0%

1%

2%

3%

4%

5%

6%

7%

8%

Jan-04 Mar-04 May-04 Jul-04 Sep-04 Nov-04 Jan-05 Mar-05 May-05 Jul-05 Sep-05 Nov-05

Capital One

EGG

MBNAHousehold

Morgan Stanley

Barclays

Source: JP Morgan

The Capital One portfolio has been impacted

Delinquency of UK Card Players(% balance 30 day+)


$97.3

$145.1

$58.6

($35.6)($60)

($40)

($20)

$0

$20

$40

$60

$80

$100

$120

$140

$160

2002 2003 2004 2005

Net Income from International Operations ($US)$M

International is still contributing to the bottom line


$190$235

$450

$650$719

$1,075$1,200

$0

$200

$400

$600

$800

$1,000

$1,200

$1,400

$1,600

$1,800

Mortgage ConsumerDeposits

AutoLending

SmallBusinessLending

HomeEquity

Card SmallBusinessDeposits

Student InstallmentLoans

Small Business Banking is an attractive opportunity

2004 Estimated Total Outstandings / Balances

Source: Mercer Oliver Wyman (MOW), McKinsey, Mortgage Bankers Association, SNL, JD Power, SMR, Visa/MC, SBA Office of Advocacy, Federal Reserve Board, Capital Resources Group Notes: Small Business estimate includes C&I loans at depository institutions and other finance company lending, family/friends/non-financial institution lending and owner loans. Overall size of Small Business deposit market difficult to estimate – estimate based on data from MOW. Card outstandings are general purpose only

$7,549$5,150

$B


We have grown our small business lending franchise

$4.1$3.3

$2.4$1.4

$0.7

$5.1

$3.5

$0

$2

$4

$6

$8

$10

2000 2001 2002 2003 2004 2005

Small Business Outstandings*

Source: Capital One; Nilson Report. *Small Business is reported in the GFS segment.

Capital One

Hibernia

Growth 100% 71% 38% 24% 26%

#1 Visa/MC Small Business Card Purchase Volume

$B

$8.6


14%

32%

83%

0%

20%

40%

60%

80%

100%

SB Card (Outstandings) SBA Loans (Originations) Other SB Lending(Outstandings)

2004 Estimated Share Among Top 10 Players

$50 $433 $980 EstimatedMarket Size ($B):

2 11

Source: FRB, SBA, MNW, SMR, NFO, HEW, SNL, Visa/MC, AXP, Earnings ReleasesNotes: 1) Card O/S and Other SB Lending O/S figures are rough estimates given general reporting requirements and mix of credit and charge card balances. Card O/S includes business card and personal cards for business use. Other SB Lending Includes IL/LOC, Real Estate, Equipment loans and leasing, Vehicle, other asset-backed loans, and owner loans (including HELOCS) 2) SBA Loans represents Top 10 for 7(a) lenders only 3) SBA Loan market size as of 9/30/2004

Most Small Business banking remains local


The home equity market is growing rapidly

Home Equity Originations

$57 $61 $64$81 $91 $100 $114

$137

$186

$254

$320

$405

$0

$50

$100

$150

$200

$250

$300

$350

$400

$450

1993 1994 1995 1996 1997 1998 1999 2000 2001 2002 2003 2004

1993-2004 CAGR: 20%

1999-2004 CAGR: 29%

$B

Source: SMR


77%

23%

7% 5% 5%

0%

10%

20%

30%

40%

50%

60%

70%

80%

Card Home Equity Student Auto Mortgage

Next to credit card, home equity is the most direct marketed product in lending

Source: Inside Mortgage Finance, SMR, SNL, HEW, JD Power, CNW

2004 Estimated Percentage Origination through Direct Channels


In 2005, we acquired eSmartLoan to become our national Capital One Home Loans platform

Key Highlights

• $155MM transaction closed in February 2005

• Proprietary consultative selling platform

• Leads generated via multiple direct channels

• HELs, HELOCs, and First Mortgages


Home loans have become a major growth play for Capital One


Notes: 2005 originations includes Capital One and Hibernia originations; Home Loans includes 1st and 2nd lien products

$2.2B

$0.5$0.0

$0.5

$1.0

$1.5

$2.0$2.5

$3.0

$3.5

$4.0

$4.5

$5.0

2004 2005

Capital One Home Loans Originations

eSmartloan$1.0

$1.5

$B

$2.5B

$4.7B

eSmartloan and Capital One

Hibernia


Overall GFS delivered strong growth in 2005

GFS Outstandings

$12

$17

$21$23

$0

$5

$10

$15

$20

$25

2002 2003 2004 2005

$B


GFS NIAT

GFS continues to contribute to the bottom line

$213

($8)

$65

$186

($50)

$0

$50

$100

$150

$200

$250

2002 2003 2004 2005

*Excludes South Africa, France, and Insurance 1 - Includes $51MM one time gain from South Africa and France 2 - Includes $18MM one time loss from Insurance

$1621 $2042GFS NIAT

(excluding exited businesses)

$MM



US Card GFSAuto



Branch deposits are among the most profitable banking businesses

20-25%

15-20%15-25%

40-50%

12-20% 12-15%10-12%

25-30%

0%

5%

10%

15%

20%

25%

30%

35%

40%

45%

50%

ConsumerDeposits

SmallBusinessBanking

Card Home Equity Auto Mortgage CRE Middle MarketBanking

Average ROE (2003 - 2005)

Source: Mercer Oliver Wyman study of medium-sized bank performance, 2003 & 2006; Capital One AnalysisSmall Business Banking includes Lending and Deposits


Banking is ripe for reinvention


We are expanding in Texas with a promising de novo strategy

Texas De Novo Strategy

Branches Completed:

Strategy:

IRR:

32

• Retail orientation• Great locations• Large offices• High level of service• Consumer and Small

Business focus

Well above hurdle


Hibernia’s de novo branches are outperforming competitors

$5.4M

$6.3M

$7.2M

$8.1M

$9.9M

$16.0M

$19.6M

$18.1M9Hibernia (new model)2

$8.8M7Wachovia7

$12.8M63

$10.5M11JP Morgan & Chase6

$12.0M24Washington Mutual5

$8.5M16Citibank8

151 $26.5MBank of America

2001-2003 De Novos Open 12+ Months

Avg. First 12 Month

Deposits per Branch

Dallas & Houston De novo Performance

Includes banks open between July 2001 to June 2003. Hibernia branches open between Dec 2003 and September 2004Source: SNL

Avg. First 18 Month

Deposits per Branch

$9.8M $13.2M13

Wells Fargo & Co.

4 Compass Bancshares


$0

$10

$20

$30

$40

$50

$60

Mon

th 0

Mon

th 1

Mon

th 2

Mon

th 3

Mon

th 4

Mon

th 5

Mon

th 6

Mon

th 7

Mon

th 8

Mon

th 9

Mon

th 1

0

Mon

th 1

1

Mon

th 1

2

Mon

th 1

3

Mon

th 1

4

Mon

th 1

5

Mon

th 1

6

Mon

th 1

7

Mon

th 1

8

Mon

th 1

9

Mon

th 2

0

Mon

th 2

1

Mon

th 2

2

Mon

th 2

3

Mon

th 2

4

Hibernia’s recent de novo openings have been outperforming the competition in Dallas

Source: SNL; Capital One estimates; Actuals for Hibernia through month end December 2005. Competitor Avg. consists of Bank of America, Wells Fargo, Washington Mutual, JP Morgan & Chase, Citibank, Compass and Wachovia in Dallas de novo branches opened July 2001 to June 2003

Hibernia Dallas De Novos (16 Branches)Deposits per Branch $MM

Number of months open

Competitor De Novo

Median ($10.7 M)N=47**


$0

$10

$20

$30

$40

$50

$60

Mon

th 0

Mon

th 1

Mon

th 2

Mon

th 3

Mon

th 4

Mon

th 5

Mon

th 6

Mon

th 7

Mon

th 8

Mon

th 9

Mon

th 1

0

Mon

th 1

1

Mon

th 1

2

Mon

th 1

3

Mon

th 1

4

Mon

th 1

5

Mon

th 1

6

Mon

th 1

7

Mon

th 1

8

Mon

th 1

9

Mon

th 2

0

Mon

th 2

1

Mon

th 2

2

Mon

th 2

3

Mon

th 2

4

Hibernia’s recent de novo openings have been outperforming the competition in Houston

Source: SNL; Capital One estimates; Actuals for Hibernia through month end December 2005. Competitor Avg. consists of Bank of America, Wells Fargo, Washington Mutual, JP Morgan & Chase, Citibank, Compass and Wachovia in Houston de novo branches opened July 2001 to June 2003

Hibernia Houston De Novos (15 Branches)Deposits per Branch $MM

Number of months open

Competitor De Novo

Median ($15.3 M)N=35**


Capital One brings significant value to banking

Brand Customer Base

Release From Deposit Growth

Constraints

Investment Capacity

National Scale

Lending


We are leveraging an experienced banking team

Texas De Novo

(Bob Kottler)

Branch Banking &

Retail(Paul

Bonitatibus)

Commercial Banking

(Rob Stuart)

Sales(Randy Bryan)

Chief Administrative

Office(Ron Samford)

President, Banking Segment(Herb Boydstun)

Integration(Miles Reidy)

CFO(Steve

Cunningham)

Chief Credit Officer(Marsha Gassan)

Hibernia Hibernia Hibernia Hibernia Hibernia HiberniaCapital One

Capital One


Growing banking is a key part of our strategic agenda

Attractive growth business

Invest in de novo growth

• Leverage the Hibernia growth platform

• Above hurdle growth opportunities

Maintain flexibility regarding future

acquisitions

• Growth platforms

• Access to new geographies and/or capabilities

• Attractive financial returns

• Structurally attractive

(above hurdle)

• Stable, low-cost funding

• Ripe for reinvention



US Card GFSAuto



1. Citi*

2. Bank of America/MBNA**

3. JPM Chase*

4. Discover

5. Capital One

6. Wells Fargo

7. WaMu / Providian

8. USBancorp*

9. Wachovia

10. Fifth Third

200 M

105 M

90 M

50 M

49 M

23 M

23 M

13 M

11 M

6 M

2005 Customer Accounts

Source: Company reports. SEC Filings. All figures include domestic and international customers (if applicable).* Figures based on 2004 Annual Reports of total company customer base as of year-end 2004 (Domestic and International)** Includes 2006 disclosure of Bank of America customer base plus Q2 2005 Cardweb estimate for MBNA

We have one of the largest customer franchises


Total Brand Awareness (%)

Our brand is among the most powerful in Financial services

Source: Millward Brown Financial Services Brand Health Wave. January, 2006

98

97

64

50

95

81

73

97

95

Question: “When you think about companies or banks that offer financial services products such as checking accounts, various types of savings

accounts, credit cards and loans, which ones come to mind?”



Establishend game positions

Leverage consolidation

for growth

Choose the right

businesses

Market end game




• Advantaged customer access

Where they buy (channel)In their wallet (relationships)In their hearts and minds (brand)

• National scale lending consolidation

• Local scale banking consolidation

• Secure end-game positions in chosen businesses before they consolidate

• Preserve doublings

• Structurally attractive (above hurdle at end game)

• Don’t need to be everywhere, but must be diversified

Secure advantaged

access to customers

• National brand

• National customer base

• Meet customers where they are

Execute at the right level

• Compete nationally in national businesses

• Compete locally in local businesses

How to createLong-term value



US Card GFSAuto

Local Banking Customer Access

• # 4 Issuer • # 2 non-captive originator

• # 2 small business card issuer

• # 3 SBA loan originator

• # 20 home equity originator

• # 7 UK card issuer

• #1 Louisiana bank*

• #12 Texas bank*

• Successful de novo model

• 49M accounts

• Leading brand

• Every channel

National Lending

Note: Texas and Louisiana ranks are based on state deposit rank as of 6/30/2005. Source: SNL

February 16, 2006

Debt Equity 2006Business Overview and Strategy Presentation

Rich Fairbank

Documents

CapOne Strategy Business Review