UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

Washington, D.C. 20549

FORM 8-K

CURRENT REPORT

Pursuant to Section 13 or 15(d) of The Securities Exchange Act of 1934

Date of Report (Date of earliest event reported) March 12, 2006

Capital One Financial Corporation

(Exact name of registrant as specified in its charter)

 

Delaware   1-13300   54-1719854
(State or other jurisdiction of
incorporation)
  (Commission File Number)   (IRS Employer Identification No.)

 

1680 Capital One Drive, McLean, Virginia   22102
(Address of principal executive offices)   (Zip Code)

Registrant’s telephone number, including area code: (703) 720-1000.

Check the appropriate box below if the Form 8-K filing is intended to simultaneously satisfy the filing obligation of the registrant under any of the following provisions:

 

x Written communications pursuant to Rule 425 under the Securities Act (17 CFR 230.425)

 

¨ Soliciting material pursuant to Rule 14a-12 under the Exchange Act (17 CFR 240.14a-12)

 

¨ Pre-commencement communications pursuant to Rule 14d-2(b) under the Exchange Act (17 CFR 240.14d-2(b))

 

¨ Pre-commencement communications pursuant to Rule 13e-4(c) under the Exchange Act (17 CFR 240.13e-4(c))

 



Item 8.01 Other Events.

On March 12, 2006, Capital One Financial Corporation, a Delaware Corporation (“Capital One”) and North Fork Bancorporation, Inc., a Delaware corporation (“North Fork”) issued a joint press release announcing the execution of the Agreement and Plan of Merger, dated as of March 12, 2006, between Capital One and North Fork.

A copy of this press release is attached hereto as Exhibit 99.1 and is incorporated by reference herein.

Additionally, Capital One hereby files the Investor Presentation attached hereto as Exhibit 99.2

Additional Information About this Transaction

In connection with the proposed merger, Capital One will file with the Securities and Exchange Commission (the “SEC”) a Registration Statement on Form S-4 that will include a joint proxy statement of Capital One and North Fork that also constitutes a prospectus of Capital One. Capital One and North Fork will mail the joint proxy statement/prospectus to their respective stockholders. Investors and security holders are urged to read the joint proxy statement/prospectus regarding the proposed merger when it becomes available because it will contain important information. You may obtain a free copy of the joint proxy statement/prospectus (when available) and other related documents filed by Capital One and North Fork with the SEC at the SEC’s website at www.sec.gov. The joint proxy statement/prospectus (when it is available) and the other documents may also be obtained for free by accessing Capital One’s website at www.capitalone.com under the heading “Investors” and then under the heading “SEC & Regulatory Filings” or by accessing North Fork’s website at www.northforkbank.com under the tab “Investor Relations” and then under the heading “SEC Filings”.

Nothing in this report constitutes an offer of securities for sale.

Participants in this Transaction

Capital One, North Fork and their respective directors, executive officers and certain other members of management and employees may be soliciting proxies from stockholders in favor of the merger. Information regarding the persons who may, under the rules of the SEC, be considered participants in the solicitation of the stockholders in connection with the proposed merger will be set forth in the joint proxy statement/prospectus when it is filed with the SEC. You can find information about Capital One’s executive officers and directors in Capital One’s definitive proxy statement filed with the SEC on March 21, 2005. You can find information about North Fork’s executive officers and directors in their definitive proxy statement filed with the SEC on March 30, 2005. You can obtain free copies of these documents from the Capital One or North Fork using the contact information above.

Forward-Looking Statements

Information set forth in this report contains forward-looking statements, which involve a number of risks and uncertainties. Capital One and North Fork caution readers that any forward-looking information is not a guarantee of future performance and that actual results could differ materially from those contained in the forward-looking information. Such forward-looking statements include, but are not limited to, statements about the benefits of the business combination transaction involving Capital One and North Fork, including future financial and operating results, the new company’s plans, objectives, expectations and intentions and other statements that are not historical facts.

The following factors, among others, could cause actual results to differ from those set forth in the forward-looking statements: the ability to obtain regulatory approvals of the transaction on the proposed terms and schedule; the failure of Capital One or North Fork stockholders to approve the transaction; the risk that the businesses will not be integrated successfully; the risk that the cost savings and any other synergies from the transaction may not be fully realized or may take longer to realize than expected; disruption from the transaction making it more difficult to maintain relationships with customers, employees or suppliers; competition and its effect on pricing, spending, third-

 

2


party relationships and revenues. Additional factors that may affect future results are contained in Capital One’s and North Fork’s filings with the SEC, which are available at the SEC’s web site http://www.sec.gov. Capital One and North Fork disclaim any obligation to update and revise statements contained in these materials based on new information or otherwise.

 

Item 9.01 Financial Statements and Exhibits

 

(d) Exhibits

The following exhibits are filed herewith:

 

EXHIBIT NO.   

DESCRIPTION OF EXHIBIT

99.1    Press Release jointly issued by Capital One Financial Corporation and North Fork Bancorporation, Inc., dated March 12, 2006
99.2    Investor Presentation of Capital One Financial Corporation, dated March 13, 2006

 

3


SIGNATURES

Pursuant to the requirements of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned hereunto duly authorized.

 

   

Capital One Financial Corporation

Date March 13, 2006

   
     

/s/ John G. Finneran, Jr.

     

Name: John G. Finneran, Jr.

     

Title: Executive Vice President, General Counsel and

Corporate Secretary

 

4


EXHIBIT INDEX

 

EXHIBIT NO.   

DESCRIPTION OF EXHIBIT

99.1    Press Release jointly issued by Capital One Financial Corporation and North Fork Bancorporation, Inc., dated March 12, 2006
99.2    Investor Presentation of Capital One Financial Corporation, dated March 13, 2006

 

5

Exhibit 99.1

 

LOGO  

 

LOGO

FOR IMMEDIATE RELEASE: March 12, 2006

 

 

Capital One to Acquire North Fork

For $14.6 Billion in Stock and Cash

 

Transaction will place Capital One among the top-10 banks in U.S.

 

Combined company will be third-largest retail depository institution in New York region,

nation’s largest deposit market

 

McLean, Va. and Melville, NY. (March 12, 2006) - Capital One Financial Corporation (NYSE: COF) and North Fork Bancorporation, Inc (NYSE: NFB) today announced a definitive agreement under which Capital One will acquire North Fork in a stock and cash transaction valued at approximately $14.6 billion. The combined company will be one of the 10 largest banks in the United States, based on deposits and managed loans, and the third-largest retail depository institution in the New York region, the nation’s largest deposit market.

 

Under the agreement, North Fork shareholders will receive cash or stock valued as of Friday, March 10, 2006 at $31.18 per North Fork share, which represents a 22.8 percent premium over the closing price of North Fork shares.

 

Capital One expects minimal disruption for North Fork’s employees, customers, and communities since the companies have no geographically overlapping banking operations.

 

“North Fork is a great strategic fit with Capital One and brings balance and diversification to our company,” said Richard D. Fairbank, Chairman and Chief Executive Officer of Capital One. “We’re continuing to combine the power of national lending and local banking. North Fork provides us with a proven franchise and a strong growth platform in the largest banking market in America. Our highest priority will be the successful integration of North Fork and the continued growth of our banking businesses in New York, New Jersey, Connecticut, Louisiana, and Texas.”

 


Capital One, a financial holding company, is one of the nation’s leading diversified financial services companies and through its subsidiary, Hibernia National Bank, operates more than 300 branches in Louisiana and Texas. North Fork, a bank holding company with operations in the greater New York region, provides a full range of financial products and services to its retail and commercial customers, including deposit products and consumer, business and mortgage loans, along with other services. With approximately $36.6 billion in deposits, as of December 31, 2005, and 355 branch locations throughout New York, New Jersey and Connecticut, North Fork is the third-largest depository institution in the greater New York region.

The combined company will have deposits of more than $84 billion, a managed loan portfolio of more than $143 billion, more than 50 million customer accounts, and 655 branches.

Fairbank said, “Small business is at the intersection of national lending and local banking. Capital One is already one of the nation’s leaders in small business lending, and North Fork has a strong and growing small business franchise. With this transaction, we can accelerate growth in this attractive and profitable market and bring a full spectrum of banking services to small business customers through multiple channels.”

The transaction is expected to close in the fourth quarter of 2006. North Fork Chairman, President and Chief Executive Officer, John A. Kanas will become the President of Capital One’s banking business, reporting directly to Capital One’s Chairman and Chief Executive Officer, Richard D. Fairbank, and will join Capital One’s Board of Directors. Herb Boydstun, President of Capital One’s existing banking subsidiary, will report to Kanas and will continue to lead Capital One’s banking business in Louisiana and Texas.

“I am especially pleased to welcome John Kanas, his outstanding management team, and North Fork’s talented employees to Capital One. Under John’s leadership over the last 35 years, North Fork has become one of America’s premier banks. John’s business acumen and operational excellence are legendary in banking. He will be a welcome addition to our senior management team and our Board. North Fork is known for its commitment to its customers, employees and communities and, working with John and his team, we expect to build on this legacy.”

Fairbank added, “We remain committed to our banking strategy in Louisiana and Texas. Our integration of Hibernia continues to progress smoothly. We have a leading position in Louisiana and we’re accelerating Hibernia’s successful de novo growth strategy in the fastest growing markets in Texas. Under Herb’s leadership, we’ll continue to focus on building a winning banking business in those markets.”


Kanas said, “I share Rich’s vision for bringing together the best of Capital One and North Fork. Capital One already has over three million customer accounts in our footprint. Together, we can create great value for our shareholders and customers by combining Capital One’s financial strength, national brand, massive customer base, leading financial products and marketing capabilities, with our strong business-oriented banking franchise. I’m incredibly proud of everything that we created as an independent company and I am committed to building the next generation of North Fork as part of Capital One.”

Under the terms of the definitive agreement, which has been approved by both companies’ boards of directors, North Fork shareholders will have the right, subject to proration, to elect to receive cash or Capital One common stock, in either case having a value equal to $11.25 plus the value at closing of .2216 Capital One shares. Based on the price of Capital One shares at the close of business on Friday, March 10, 2006, the transaction is valued at $31.18 per North Fork share. The actual value on consummation of the acquisition will depend on Capital One’s share price at that time. The total transaction value of approximately $14.6 billion includes $5.2 billion in cash. This cash consideration will be financed through a combination of internal resources and market financings, potentially including a hybrid capital security.

The transaction is subject to shareholder approval from both companies in addition to regulatory approval. The transaction is expected to close in the fourth quarter of 2006. Additionally, Capital One said it expects to repurchase approximately $3 billion of its shares of common stock in the open market following the consummation of the transaction. The company expects approximately half of such repurchase program would occur during the last six months of 2007 and half during the first six months of 2008. The timing and nature of these repurchases will depend on market conditions and applicable securities laws. Capital One expects to maintain its current dividend policy subject to review by its Board of Directors.

Capital One expects the transaction to achieve cost savings and other synergies of $275 million, pretax, fully phased in by 2008, and to be mildly accretive beginning in 2008. Capital One affirmed its earnings per share guidance for 2006 to be between $7.40 and $7.80 per share (fully diluted), excluding the impact of this transaction.

J.P. Morgan Securities, Inc and Citigroup Corporate and Investment Banking acted as financial advisers to Capital One and Cleary Gottlieb Steen & Hamilton LLP acted as its legal counsel. Sandler


O’Neill, LP and Keefe, Bruyette & Woods, Inc. acted as financial advisers to North Fork and Wachtell, Lipton, Rosen & Katz acted as its legal counsel.

Forward-Looking Statements

Information set forth in this release contains forward-looking statements, which involve a number of risks and uncertainties. Capital One and North Fork caution readers that any forward-looking information is not a guarantee of future performance and that actual results could differ materially from those contained in the forward-looking information. Such forward-looking statements include, but are not limited to, statements about the benefits of the business combination transaction involving Capital One and North Fork, including future financial and operating results, the new company’s plans, objectives, expectations and intentions and other statements that are not historical facts.

The following factors, among others, could cause actual results to differ from those set forth in the forward-looking statements: the ability to obtain regulatory approvals of the transaction on the proposed terms and schedule; the failure of Capital One or North Fork stockholders to approve the transaction; the risk that the businesses will not be integrated successfully; the risk that the cost savings and any other synergies from the transaction may not be fully realized or may take longer to realize than expected; disruption from the transaction making it more difficult to maintain relationships with customers, employees or suppliers; competition and its effect on pricing, spending, third-party relationships and revenues. Additional factors that may affect future results are contained in Capital One’s and North Fork’s filings with the SEC, which are available at the SEC’s web site http://www.sec.gov. Capital One and North Fork disclaim any obligation to update and revise statements contained in these materials based on new information or otherwise.

Additional Information About this Transaction

In connection with the proposed merger, Capital One will file with the Securities and Exchange Commission (the “SEC”) a Registration Statement on Form S-4 that will include a joint proxy statement of Capital One and North Fork that also constitutes a prospectus of Capital One. Capital One and North Fork will mail the joint proxy statement/prospectus to their respective stockholders. Investors and security holders are urged to read the joint proxy statement/prospectus regarding the proposed merger when it becomes available because it will contain important information. You may obtain a free copy of the joint proxy statement/prospectus (when available) and other related documents filed by Capital One and North Fork with the SEC at the SEC’s website at www.sec.gov. The joint proxy statement/prospectus (when it is available) and the other documents may also be obtained for free by accessing Capital One’s website at www.capitalone.com under the heading “Investors” and then under the heading “SEC & Regulatory Filings” or by accessing North Fork’s website at www.northforkbank.com under the tab “Investor Relations” and then under the heading “SEC Filings”.

This release does not constitute an offer of securities for sale.

Participants in this Transaction

Capital One, North Fork and their respective directors, executive officers and certain other members of management and employees may be soliciting proxies from stockholders in favor of the merger. Information regarding the persons who may, under the rules of the SEC, be considered participants in the solicitation of the stockholders in connection with the proposed merger will be set forth in the joint proxy statement/prospectus when it is filed with the SEC. You can find information about Capital One’s executive officers and directors in Capital One’s definitive proxy statement filed with the SEC on


March 21, 2005. You can find information about North Fork’s executive officers and directors in their definitive proxy statement filed with the SEC on March 30, 2005. You can obtain free copies of these documents from the Capital One or North Fork using the contact information above.

Capital One Hosts Analyst Conference Call

Capital One’s webcast of the analyst conference call is scheduled for Monday, 13 March at 8:30 am EST. The webcast will be accessible on the company’s home page (http://www.capitalone.com). Choose “Investors” on the bottom left corner of the home page to access the webcast and view and download the press release, slides, and other financial information.

About Capital One

Headquartered in McLean, Virginia, Capital One Financial Corporation (www.capitalone.com) is a financial holding company whose principal subsidiaries, Capital One Bank, Capital One, F.S.B., Capital One Auto Finance, Inc., and Hibernia National Bank (www.hibernia.com), offer a broad spectrum of financial products and services to consumers, small businesses and commercial clients. Capital One’s subsidiaries collectively had $47.9 billion in deposits and $105.5 billion in managed loans outstanding as of December 31, 2005. Capital One, a Fortune 500 company, trades on the New York Stock Exchange under the symbol “COF” and is included in the S&P 500 index.

About North Fork

North Fork is a regional bank holding company headquartered in New York with approximately $58 billion in assets conducting commercial and retail banking from branch locations in the Tri-State area with a complementary national mortgage banking business.

Capital One Contacts:

Investors: Mike Rowen, 703-720-2455

Media: Tatiana Stead, 703-720-2352; Julie Rakes, 804-284-5800

North Fork Contacts:

Investors: Daniel M. Healy, 631-531-2058

###

March 13, 2006
March 13, 2006
Investor Presentation
Exhibit 99.2


2
Forward-Looking Statements
Information set forth in this report contains forward-looking statements, which involve a number of risks and uncertainties.  Capital
One
and
North
Fork
caution
readers
that
any
forward-looking
information
is
not
a
guarantee
of
future
performance
and
that
actual
results could differ materially from those contained in the forward-looking information.  Such forward-looking statements include, but
are not limited to, statements about the benefits of the business combination transaction involving Capital One and North Fork,
including future financial and operating results, the new company’s plans, objectives, expectations and intentions and other
statements that are not historical facts.
The following factors, among others, could cause actual results to differ from those set forth in the forward-looking statements: the
ability
to
obtain
regulatory
approvals
of
the
transaction
on
the
proposed
terms
and
schedule;
the
failure
of
Capital
One
or
North
Fork
stockholders to approve the transaction; the risk that the businesses will not be integrated successfully; the risk that the cost savings
and
other
synergies
from
the
transaction
may
not
be
fully
realized
or
may
take
longer
to
realize
than
expected;
disruption
from
the
transaction making it more difficult to maintain relationships with customers, employees or suppliers; competition and its effect on
pricing, spending, third-party relationships and revenues. Additional factors that may affect future results are contained in Capital
One’s
and
North
Fork’s
filings
with
the
SEC,
which
are
available
at
the
SEC’s
web
site
http://www.sec.gov.
Capital
One
and
North
Fork
disclaim any obligation to update and revise statements contained in these materials based on new information or otherwise.
Additional Information About this Transaction
In connection with the proposed merger, Capital One will file with the Securities and Exchange Commission (the SEC) a Registration
Statement on Form S-4 that will include a joint proxy statement of Capital One and North Fork that also constitutes a prospectus of
Capital One.  Capital One and North Fork will mail the joint proxy statement/prospectus to their respective stockholders.  Investors and
security holders are urged to read the joint proxy statement/prospectus regarding the proposed merger when it becomes available
because
it
will
contain
important
information.
You
may
obtain
a
free
copy
of
the
joint
proxy
statement/prospectus
(when
available)
and
other
related
documents
filed
by
Capital
One
and
North
Fork
with
the
SEC
at
the
SEC’s
website
at
www.sec.gov.
The
joint
proxy
statement/prospectus (when it is available) and the other documents may also be obtained for free by accessing Capital One’s website
at
www.capitalone.com
under
the
heading
“Investors”
and
then
under
the
heading
“SEC
&
Regulatory
Filings”
or
by
accessing
North
Fork’s
website
at
www.northforkbank.com
under
the
tab
“Investor
Relations”
and
then
under
the
heading
“SEC
Filings”.
This
release
does
not
constitute
an
offer
of
securities
for
sale.
Participants in this Transaction
Capital One, North Fork and their respective directors, executive officers and certain other members of management and employees
may be soliciting proxies from stockholders in favor of the merger.  Information regarding the persons who may, under the rules of the
SEC,
be
considered
participants
in
the
solicitation
of
the
stockholders
in
connection
with
the
proposed
merger
will
be
set
forth
in
the
joint
proxy
statement/prospectus
when
it
is
filed
with
the
SEC.
You
can
find
information
about
Capital
One’s
executive
officers
and
directors in Capital One’s definitive proxy statement filed with the SEC on March 21, 2005.  You can find information about North Fork’s
executive officers and directors in their definitive proxy statement filed with the SEC on March 30, 2005.  You can obtain free copies of
these documents from the Capital One or North Fork using the contact information above.


3
Transaction Summary and Strategic Rationale
Financial Overview
*
*
*
*


4
Consideration per Share
$31.18 in value per NFB share (based on the closing price of $89.92 of
COF on March 10, 2006, 0.2216x fixed exchange ratio and $11.25 in cash)
.
64% stock and 36% cash
Transaction value
Approximately $14.6 billion
NFB ownership
Approximately 25% (fully diluted basis)
Termination fee
Reciprocal options grant
Mgmt. & Board
NFB Chairman & CEO, John Kanas, to join COF Board and be President of
Banking
Share Repurchase
$1.5B in second half 2007 and additional $1.5B in first half 2008
Near-term synergies
$275 million (50% in 2007; 100% in 2008)
EPS Accretion/Dilution
GAAP
Operating
Cash Operating
-2007
(6.5%)
(4.9%)
(2.3%)
-2008
(1.1%)
0.4%
2.6%
Approvals
Regulatory, NFB and COF shareholder approvals
Expected Closing
4th Quarter 2006
Transaction Summary
1 -
Subject to proration
1


5
Transaction multiples are in line with precedent
Transaction multiples are in line with precedent
transactions
transactions
Transaction
Terms
Comparable
Transaction
Medians
(2)
Value per NFB share
(1)
$31.18
Share Price Premium
1 day ($25.40)
22.8%
23.8%
5 day ($25.34) 
23.1%
26.5%
Price as a multiple of:
LTM GAAP EPS
15.5x
19.2x
NTM Cash EPS
15.7x
15.9x
Book Value
1.6x
2.7x
Tangible Book Value
4.9x
3.7x
Premium/Core Deposits
34.1%
30.6%
(1) Based on COF share price of $89.92 on 3/10/06
(2) Bank acquisitions (excluding MOEs) valued greater than $3B since January 2003
NTM GAAP EPS
16.0x
16.1x


6
This deal creates near term synergies and
This deal creates near term synergies and
strategically transforms the company
strategically transforms the company
Near-term earnings
Near-term earnings
synergies
synergies
($275 M in 2008)
Reduced capital levels
Reduced capital levels
Expense reduction
Expense reduction
Balance sheet savings
Balance sheet savings
Revenue opportunities
Revenue opportunities
Lower risk profile
Lower risk profile
Less volatility
Less volatility
Achieves
Achieves
hurdle rate
hurdle rate
Strategically
Strategically
transforms
transforms
the
the
company
company
AND
AND
Balance and
Balance and
diversification
diversification
New growth
New growth
opportunities
opportunities


7
Our strategy works backward from the marketplace
Our strategy works backward from the marketplace
National Scale
Lending
Local Scale
Banking
Advantaged
Customer
Access
Market End Game
Low Risk, Balanced and Diversified


8
For years, our strategic agenda has emphasized two
For years, our strategic agenda has emphasized two
broad thrusts
broad thrusts
Secure and leverage
Secure and leverage
growth platforms
growth platforms
Balance and
Balance and
diversify the
diversify the
company
company
Diversified, lower
Diversified, lower
risk assets
risk assets
Diversified
Diversified
liabilities
liabilities
Diversified profits
Diversified profits
Structurally attractive
Structurally attractive
industries and
industries and
markets
markets
Winning business
Winning business
models
models
Exceptional growth
Exceptional growth
and profitability
and profitability
Deliver Enduring Value Creation


9
This acquisition delivers on our strategic agenda
This acquisition delivers on our strategic agenda
Balance and diversify the
Balance and diversify the
company
company
Secure and leverage
Secure and leverage
growth platforms
growth platforms
32% core deposit funding*
49% of profits outside of card
2.97% charge-off rate, in-line
with other large diversified
retail franchises
Lower capital requirements
Structurally attractive local scale
businesses (in the largest market
in the U.S.)
Deposit led small
business/middle market banking
Consumer deposits
National scale Alt A mortgage
and home equity platform
Stand-out track record for growth
Leverages COF strengths
Brand and customers
National scale products
IBS
Substantial long term shareholder value creation
* Core deposits defined as branch deposits excluding Jumbo Time and Foreign deposits
Source: Company filings


10
With North Fork we are a balanced and diversified
With North Fork we are a balanced and diversified
financial institution
financial institution
0%
10%
20%
30%
40%
50%
60%
70%
80%
90%
100%
Managed Loans
Managed Liabilities
NIAT
$143B
$168B
$2.87B
3
Auto
11%
Bank¹
38%
GFS
16%
U.S.
Card
35%
1
Bank
is
reported
in
“Other”
segment
as
reported
for
COF
earnings.
2
Includes Hibernia net income of $107.1M for first three quarters of 2005.
3
Total
earnings
includes
$149M
in
unallocated
net
losses
held
in
the
“Other”
category
representing
(7%)
for
2005
COF-only
earnings.
Source:  Company filings; As of 12/31/2005
Other
Borrowings  9%
Branch
Deposits
35%
Securitization
34%
Debt  4%
Other  3%
Branchless
Deposits
16%
Auto  4%
Bank
1,2
34%
GFS   6%
U.S.
Card
51%
Capital One and North Fork 2005 Pro Forma
51%


11
0.12%
0.18%
0.26%
0.30%
0.43%
0.52%
0.75%
2.08%
2.63%
2.72%
2.97%
0.0%
0.5%
1.0%
1.5%
2.0%
2.5%
3.0%
3.5%
Capital One /
North Fork Pro
Forma
Citigroup
Bank of
America
JPMorgan
Chase
Wells Fargo
USBancorp
National City
BB&T
Washington
Mutual
SunTrust
Wachovia
2005 Managed U.S. Retail and Commercial Charge-off Rate
Our pro forma loss rate is in line with other
Our pro forma loss rate is in line with other
diversified retail franchises
diversified retail franchises
Note:
Citi
is
US
Consumer
only;
JPMChase
includes
Retail
Financial
Services,
Card
Services
and
Commercial
Banking;
BofA
includes
Consumer
&
Small
Business
and
Business
&
Financial
Services
and
is
pro
forma
to
include
MBNA
acquisition;
National
City
excludes
Asset
Management;
USBank
includes
Wholesale
&
Consumer
Banking
and
Payment
Services.
Wachovia,
BB&T,
Washington
Mutual
(pro
forma
to
include
Providian),
SunTrust,
Wells
Fargo,
Capital
One
and
North
Fork
are
total
company.
Source:  Company filings; As of 12/31/2005


12
We have secured a broad portfolio of growth
We have secured a broad portfolio of growth
platforms in attractive markets with end game
platforms in attractive markets with end game
positioning
positioning
Local Banking
Local Banking
Customer Access
Customer Access
National Lending
National Lending
Note: Texas and Louisiana ranks are based on state retail deposit rank. NYC rank based on New York MSA retail deposit rank.  As of 6/30/05.  US Card ranking
based on $ outstandings, Auto on volume originations, Mortgage and Home Equity on $ originations, Small Business on card volumes, SBA on $ originations,
and UK card on volume and survey results.
Source: SNL, company reports
# 4 US Card issuer
# 2 Non-captive Auto
originator
# 7 Alt-A Mortgage
originator
# 11 Home Equity
originator
# 2 Small Business
card issuer
# 3 SBA loan originator
# 7 UK card issuer
#1 Louisiana bank
#3 NYC MSA bank
#12 Texas bank
Two successful de novo
models
Winning small business
and middle market
banking model (North
Fork)
Winning consumer and
small business growth
model (Hibernia)
Over 50 M accounts
3 million COF
accounts in NYC
MSA
Leading Brand
Every channel


13
John Kanas
John Kanas
will lead banking and integration
will lead banking and integration
John Kanas
President, Banking
John Bohlsen
EVP Banking, Metro NY
Herb Boydstun
EVP Banking, LA and TX
Report to Rich Fairbank,
CEO & Chairman, COF
Will be appointed to
COF Board
Miles Reidy
Integration


14
North Fork is a leading Metro New York Bank
North Fork is a leading Metro New York Bank
North Fork Bancorporation
established in 1980
Predecessor institutions date
back to 1858
Third largest retail depository in
metropolitan New York
353 branches
Premier small business and
middle market banking franchise
National mortgage banking
business
Acquired and integrated 14 banks
over the last 20 years
Note: Retail deposits excludes estimated corporate and other non-traditional deposits by excluding balances in excess of $500MM deposits for any individual branch.


15
North Fork has a strong track record for
North Fork has a strong track record for
deposit growth
deposit growth
$1.6
$2.0
$2.7
$3.4
$4.1
$6.7
$7.6
$0
$1
$2
$3
$4
$5
$6
$7
$8
$9
$10
1999
2000
2001
2002
2003
2004
2005
Total Deposits
Source:
Company
filings
and
North
Fork
KBW
investor
presentation
(March
1,
2006)
Note:
Includes
acquisition
of
GreenPoint
in
2004
Demand Deposits
$7.6
$9.2
$11.3
$13.2
$15.1
$34.8
$36.6
$0
$5
$10
$15
$20
$25
$30
$35
$40
1999
2000
2001
2002
2003
2004
2005
$B
$B


16
North Fork’s lending growth has been strong
North Fork’s lending growth has been strong
$0
$10
$20
$30
$40
North Fork Total Loans Held for Investment
$B
$33.2B
Residential
Mortgage
Multifamily
Commercial RE
Construction
C&I
Consumer
$30.5B
$12.4B
$11.4B
$10.4B
$9.4B
Source: Company filings
Note: Includes acquisition of GreenPoint
in 2004


17
North Fork has delivered strong earnings growth
North Fork has delivered strong earnings growth
$2.01
$1.85
$1.73
$1.72
$1.37
$0.93
$1.01
$0.82
$0.82
$0.45
$0.46
$0.31
$0.00
$0.40
$0.80
$1.20
$1.60
$2.00
$2.40
North Fork Earnings Per Share
Source: Company filings


18
Local Scale Deposit
Position in               
New York MSA
North Fork
National Scale
Mortgage & Home
Equity Origination
Platform
#3 Retail deposit
position in NY MSA
#4 Retail deposit
position in Manhattan
#7 Alt-A Mortgage
originator
#13 home equity
originator
Assets: $57.6B
Deposits: $37B
ROA: 1.59%
ROTE: 31%
2005 NIAT: $949MM
Market Cap: $12B
Local Scale Small
Business / Middle
Market Commercial
Banking Platform
Leading NY middle
market commercial
banking platform
#3 Small business
lender (<$1 MM) in
NY MSA
Capital One has secured a premier business model
with end game positioning
Source: SNL, Company filings as of 12/31/2005


19
Local Scale Deposit
Position in               
New York MSA
North Fork
National Scale
Mortgage & Home
Equity Origination
Platform
#3 Retail deposit
position in NY MSA
#4 Retail deposit
position in Manhattan
#7 Alt-A Mortgage
originator
#13 home equity
originator
Assets: $57.6B
Deposits: $37B
ROA: 1.59%
ROTE: 31%
2005 NIAT: $949MM
Market Cap: $12B
Local Scale Small
Business / Middle
Market Commercial
Banking Platform
Leading NY middle
market commercial
banking platform
#3 Small business
lender (<$1 MM) in NY
MSA
Capital One has secured a premier business model
with end game positioning
Source: SNL, Company filings as of 12/31/2005


20
$431
$238
$178
$111
$104
$100
$94
$84
$64
$64
$62
$61
$45
$45
$43
0
50
100
150
200
250
300
350
400
450
500
New York is the largest deposit market in the US
New York is the largest deposit market in the US
2005 Top 15 MSAs
Retail* Deposits
$ B
*Excludes estimated corporate and other non-traditional deposits by excluding balances in excess of $500MM deposits for any individual branch.
Note: Deposits growth calculated from 2000-2005
Source: SNL
2000 –
2005
Retail Deposits
CAGR
5.6%
8.2%
5.8%
7.9%
6.4%
5.6%
6.0%
7.9%
6.1%
7.9%
6.1%
2.8%
8.0%
10.4%
6.8%
From 2000-05
NYC Market
grew $103B


21
North Fork has an end game local share
North Fork has an end game local share
position in New York
position in New York
2,959
307
222
183
241
317
188
516
356
247
382
2005 Total
Branches
61.6%
3.3%
3.6%
3.8%
4.0%
4.8%
5.0%
6.1%
7.6%
9.5%
13.9%
2005 Retail*
Market Share
$557
$266
Total top 10
$37
$14
Bank of NY
10
$16
$16
Sovereign
9
$16
$16
Commerce
8
$17
$17
Washington Mutual
7
$27
$21
Wachovia
6
$45
$22
HSBC
5
$51
$26
Bank of America
4
$37
$33
North Fork
3
$127
$41
Citigroup
2
$183
$60
Chase
1
2005 Total
Deposits ($B)
2005 Retail*
Deposits ($B)
Bank
Retail* Deposit
Rank
*Excludes estimated corporate and other non-traditional deposits by excluding balances in excess of $500MM deposits for any individual branch.
Source: SNL
New York MSA Deposit rankings
As of June 2005


22
North Fork has an end game local share in
North Fork has an end game local share in
Manhattan
Manhattan
*Excludes estimated corporate and other non-traditional deposits by excluding balances in excess of $500MM deposits for any individual branch.
Source: SNL
Manhattan Deposit rankings
As of June 2005
370
11
30
14
18
20
33
43
46
63
92
2005 Total
Branches
74.5%
1.7%
2.1%
2.5%
2.6%
3.1%
3.5%
7.5%
8.8%
18.0%
24.8%
2005 Retail*
Market Share
$335
$69
Total top 10
$2
$2
Apple Bank
10
$2
$2
Washington Mutual
9
$5
$2
Emigrant
8
$2
$2
Commerce
7
$26
$3
Bank of NY
6
$10
$3
Bank of America
5
$8
$7
North Fork
4
$31
$8
HSBC
3
$103
$17
Citigroup
2
$146
$23
Chase
1
2005 Total
Deposits ($B)
2005 Retail*
Deposits ($B)
Bank
Retail*
Deposit Rank


23
North Fork has doubled its share in NY over the last
North Fork has doubled its share in NY over the last
5 years
5 years
$11.2
$12.9
$15.1
$17.0
$1.0
$1.2
$4.4
$16.2
$0
$5
$10
$15
$20
$25
$30
$35
2000
2001
2002
2003
2004
2005
North Fork Retail* Deposits
New York retail*
New York retail*
market share
market share
2.7%
3.6%
7.7%
2.9%
3.4%
4.7%
$8.9
$9.7
$14.1
$19.4
$33.2
$12.1
*Excludes estimated corporate and other non-traditional deposits by excluding balances in excess of $500MM deposits for any individual branch;
Counts in-store branches as ¼
of a traditional branch (estimated relative operating cost and capital required).
Note: Data as of June of each year
Source: SNL.
Acquired
deposits
Organic growth
(CAGR = 13.8%)
$B


24
North Fork delivers industry leading same store
North Fork delivers industry leading same store
deposit growth
deposit growth
10%
6%
15%
25%
7%
7%
20%
25%
0%
5%
10%
15%
20%
25%
30%
Pre-1970
1970-1980
1980-1990
1990-2000
2000-2005 Retail* Deposit CAGR
By 10-Year Tranche
Commerce
North Fork
Branch Open Date
*Excludes estimated corporate and other non-traditional deposits by excluding balances in excess of $500MM deposits for any individual branch.
Note: Includes only branches owned by North Fork and Commerce as
of June 2000
Source: SNL
# of Branches:
79
21
16
16
2
9
24
85
NYC MSA
Competitor
Average


25
$985
$954
$975
$1,028
$952
$1,187
$1,529
$1,968
$0
$500
$1,000
$1,500
$2,000
1998
1999
2000
2001
2002
2003
2004
2005
North Fork has extended its same store
North Fork has extended its same store
growth performance to acquired branches
growth performance to acquired branches
Commercial Bank of NY Total Deposits*
Source: FDIC, SNL
Deposits per
branch ($MM)
$68
$73
$73
$91
$118
$151
Acquired by North
Fork in Nov 2001
$70
$70
$MM
2001 –
2005
CAGR = 17.6%
*Data as of June of each year


26
$0
$25
$50
$75
$100
$125
$150
$175
Year 0
Year 1
Year 2
Year 3
Year 4
De novo Branch Deposits
(by Year of Opening)
2000 North Fork Manhattan (n=1)
2001 North Fork Manhattan (n=4)
2003 North Fork Manhattan (n=6)
2004 North Fork non-Manhattan (n=9)
2002 North Fork Manhattan (n=2)
Active brick and mortar branches only.  As of 6/30/2005
Source:  SNL.
North Fork’s de novo performance is strong
North Fork’s de novo performance is strong
$MM
National Median 2000-2005
2003 North Fork non-Manhattan (n=3)
2002 North Fork non-Manhattan (n=4)


27
Our leading position in Louisiana is a cornerstone
Our leading position in Louisiana is a cornerstone
of our banking strategy
of our banking strategy
Source: SNL data 06/05
10
9
8
7
6
5
4
3
2
1
2.2%
Omni
2.6%
AmSouth
2.5%
Gulf Coast
2.5%
Firstrust
1.9%
3.0%
7.0%
16.0%
16.8%
28.5%
Parish National
Fidelity
Regions
Whitney
JP Morgan Chase
Capital One
New Orleans
10
9
8
7
6
5
4
3
2
1
1.1%
Fidelity Homestead
3.1%
AmSouth
2.7%
Hancock
1.1%
Firstrust
1.0%
3.6%
7.6%
8.4%
16.5%
21.1%
Bancorp South
Iberia
Regions
Whitney
JP Morgan Chase
Capital One
Total Deposit
Share
Company
Rank
Company
Rank
Total Deposit
Share
Louisiana


28
Texas de novo is one of our most attractive
Texas de novo is one of our most attractive
growth opportunities
growth opportunities
$5.4M
$6.3M
$7.2M
$8.1M
$9.9M
$16.0M
$19.6M
$18.1M
9
Capital One (new model)
2
$8.8M
7
Wachovia
7
$12.8M
6
3
$10.5M
11
JP Morgan Chase
6
$12.0M
24
Washington Mutual
5
$8.5M
16
Citibank
8
15
1
$26.5M
Bank of America
2001-2003
De Novos
Open 12+
Months
Avg. First      
12 Month
Deposits per
Branch
Dallas & Houston De novo Performance
Dallas & Houston De novo Performance
Includes banks open between July 2001 to June 2003.  Hibernia branches open between Dec 2003 and September 2004
Source: SNL as of 6/30/2005
Avg. First      
18 Month
Deposits per
Branch
$9.8M
$13.2M
13
Wells Fargo & Co.
4
Compass Bancshares


29
With North Fork, Capital One has multiple ways to
With North Fork, Capital One has multiple ways to
win in deposits
win in deposits
Strong market
Strong market
positions
positions
Ability to drive
Ability to drive
growth in
growth in
mature
mature
networks
networks
Winning de
Winning de
novo models
novo models
Leading
Leading
branchless
branchless
player
player
# 1 in Louisiana
# 3 in New York
MSA
# 12 in Texas
Proven same-
store growth
(North Fork)
Proven ability to
drive growth in
acquired
franchises  
(North Fork)
Two successful
branch models
Hibernia
North Fork
Top 3 branchless
deposit player*
* Excludes sweep accounts
Note:
Texas
and
Louisiana
ranks
are
based
on
state
retail
deposit
rank.
NYC
rank
based
on
New
York
MSA
retail
deposit
rank.
All
as
of
6/30/05.
Source: SNL


30
Local Scale Deposit
Position in               
New York MSA
North Fork
National Scale
Mortgage & Home
Equity Origination
Platform
#7 Alt-A Mortgage
originator
#13 home equity
originator
Local Scale Small
Business / Middle
Market Commercial
Banking
#3 Retail deposit
position in NY MSA
#4 Retail deposit
position in Manhattan
Leading NY middle
market commercial
banking platform
#3 Small business
lender (<$1 MM) in
NY MSA
Assets: $57.6B
Deposits: $37B
ROA: 1.59%
ROTE: 31%
2005 NIAT: $949MM
Market Cap: $12B
Capital One has secured a premier business model
with end game positioning
Source: SNL, Company filings as of 12/31/2005


31
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%
Consumer
Deposits
Small
Business
Banking
(Deposits &
lending)
Card
Home Equity
Auto
Mortgage
CRE
Middle Market
Lending
Average ROE (2003 -
2005)
Source: Mercer Oliver Wyman study of medium-sized bank performance, 2003 & 2005; Capital One Analysis
Small Business Banking includes Lending and Deposits
Next to consumer deposits, small business banking
Next to consumer deposits, small business banking
is the most profitable sector in banking
is the most profitable sector in banking


32
Small business and middle market commercial
Small business and middle market commercial
banking is a key part of North Fork’s model
banking is a key part of North Fork’s model
$2.9
$4.3
$5.2
$7.1
$9.9
$0
$2
$4
$6
$8
$10
$12
2001
2002
2003
Q3 2004*
2005
North Fork Small Business +
Commercial Deposits
Source: Company filings
Notes: * Estimate based on 3Q 2004 reported commercial demand deposits of $3.8B; **Excludes Multi Family ($4.8 B in 2005) and Construction & Land ($829 MM in 2005)
$3.3
$4.0
$5.0
$8.4
$10.9
$0
$2
$4
$6
$8
$10
$12
2001
2002
2003
2004
2005
North Fork Small Business +
Commercial Loans**
C+I
CRE
CAGR
CAGR
36%
37%
33%
% of Total:
33%
27%
26%
25%
34%
% of Total:
31%
28%
40%
35%
33%
$B
$B


33
Combining national and local scale small business
Combining national and local scale small business
platforms unlocks substantial value
platforms unlocks substantial value
COF National Scale Small
COF National Scale Small
Business Platforms
Business Platforms
National scale lending platforms
for smaller loans
Small Business Cards          
(#2 Issuer)
SBA Loans (#3 Originator)
Small Business Installment
Loans and Lines
250K COF Small Business
customers in NYC
National Brand and marketing
expertise
North Fork Local Scale Small
North Fork Local Scale Small
Business Platform
Business Platform
Deposit led, relationship oriented
model
North Fork Small
Business/Middle Market
customer base


34
The opportunity to expand North Fork’s consumer
The opportunity to expand North Fork’s consumer
business is significant
business is significant
6%
25%
27%
35%
0%
5%
10%
15%
20%
25%
30%
35%
40%
North Fork
Hibernia
Peer Group
Top 10 Banks
2005 % Consumer Loans
2005 % Consumer Loans
(Excludes First Mortgages)
(Excludes First Mortgages)
Source: Company reports and FDIC call reports; as of 12/31/2005


35
Total Brand Awareness (%)*
The Capital One 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?”


36
Local Scale Deposit
Position in               
New York MSA
North Fork
National Scale
Mortgage & Home
Equity Origination
Platform
#7 Alt-A Mortgage
originator
#13 home equity
originator
Local Scale Small
Business / Middle
Market Commercial
Banking
#3 Retail deposit
position in NY MSA
#4 Retail deposit
position in Manhattan
Leading NY middle
market commercial
banking platform
#3 Small business
lender (<$1 MM) in
NY MSA
Assets: $57.6B
Deposits: $37B
ROA: 1.59%
ROTE: 31%
2005 NIAT: $949MM
Market Cap: $12B
Capital One has secured a premier business model
with end game positioning
Source: SNL, Company filings as of 12/31/2005


37
Alt-A is an attractive segment of the mortgage
Alt-A is an attractive segment of the mortgage
industry
industry
$45
$60
$80
$191
$330
$0
$50
$100
$150
$200
$250
$300
$350
$400
2001
2002
2003
2004
2005*
Alt-A Industry Originations
1
0%
5%
10%
15%
20%
25%
30%
35%
Conforming
Alt-A
Subprime
Estimated ROE by Product
2
1
-
Source:  Inside Mortgage Finance
2
-
Source:  Mercer Oliver Wyman
* -
Based on three quarters annualized estimate
12-18%
18-25%
20-30%
Charge-offs
(bps)
1-2
15-25
50-300
$B


38
North Fork has a leading national scale Alt-A
North Fork has a leading national scale Alt-A
mortgage originations platform
mortgage originations platform
1.
Countrywide
2.
IndyMac
3.
Aurora (Lehman)
4.
GMAC
5.
Wells Fargo
6.
Impac
7.
North Fork
8.
WMC (GE)
9.
First Horizon
10.
SunTrust
Source:  Inside Mortgage Finance
Origination ($B)
Top 10 Alt-A Originators (2005)
19.1%
13.5%
12.1%
10.5%
9.1%
6.7%
5.6%
5.4%
3.1%
2.6%
Share (%)
$63.0
$44.5
$39.9
$34.5
$30.0
$22.0
$18.4
$17.1
$10.3
$ 8.7
North Fork currently sells the vast majority of its Alt A production


39
1.
Bank of America
$67.8
2.
Chase Home Finance
$54.0
3.
CitiMortgage
$45.7
4.
Wells Fargo
$45.4
5.
Countrywide
$42.7
6.
Washington Mutual
$39.7
7.
National City
$21.7
8.
GMAC
$13.9
9.
Wachovia
$10.5*
10.
HSBC
$  9.1
11.
COF/North Fork
$  7.7
$0
$1
$2
$3
$4
$5
$6
$7
$8
$9
2004
2005 Pro forma
Access to North Fork’s mortgage platform and
channels will accelerate our Home Equity growth
COF Home Equity Originations
Capital One
$0.8
$B
$7.7
Capital One
North Fork
$2.2
$5.5
Home Equity Originations ($B)
FY 2005
Source Company filings, Home Equity Weekly.  *Wachovia only reported partial year data.
Note: Some lenders do not provide second lien production volumes


40
The integration of Hibernia and North Fork will be a
The integration of Hibernia and North Fork will be a
key priority
key priority
Hibernia integration is
on track
Experienced senior
integration team
On track to exceed
$135M in ‘07 synergies
Systems integration
underway and will be
completed Q1 ‘07
(Accounting and
treasury completed)
Originating COF
products in branches
Card March 1, 2006
Auto March 15, 2006
Brand change underway
and on schedule
Limited geographic
overlap
Reduces execution risk
Limited impact on
customer facing
operations
John Kanas
Herb Boydstun
Miles Reidy
16 bank acquisition
integrations


41
Experienced diligence team
Senior COF executives including Hibernia leadership and integration team
COF representatives from all functional areas
Outside experts engaged (commercial, mortgage, compliance, legal
and retail
banking strategy)
Full scope diligence effort
Extensive external research and analysis
Discussions with North Fork senior management
On-site final diligence, including data review and key management interviews
86 branches mystery shopped (~25% of network)
All major submarkets
Acquired branches (29 Greenpoint, 7 Commercial Bank of NY, 11 Trust
Company of NJ)
De novo branches (19 branches)
Discussions with COF senior management
External research and analyses
Visited COF/Hibernia facilities in Texas and Louisiana
On-site diligence, including document review
Capital One
Capital One
North Fork
North Fork
Capital One and North Fork both conducted due
Capital One and North Fork both conducted due
diligence
diligence


42
We will be a Top 10 player in deposits
We will be a Top 10 player in deposits
Source: SNL
* Includes Capital One, Hibernia and North Fork pro forma Domestic Deposits as of 9/30/05.
1
Bank of America Corporation
566.8
2
JPMorgan
Chase & Co.
401.4
3
Wachovia Corporation
305.1
4
Wells Fargo & Company
275.6
5
Citigroup, Inc.
200.4
6
Washington Mutual, Inc.
193.3
7
U.S. Bancorp
115.2
8
SunTrust Banks, Inc.
107.3
9
Citizens
97.9
Q3 2005 U.S. Deposits
($B)
10
Capital One / North Fork (Pro Forma)*
78.6


43
We will be among the 10 largest lenders
We will be among the 10 largest lenders
Source: SNL
Note:
Universe
includes
Top-22
Domestic
Depository
institutions
and
North
Fork.
Does
not
include
ABN
Amro
and
Golden
West
(subsidiary
of
World
Savings).
*Estimate based upon FY2004 and FY2005 reported loan balances.
1
Bank of America Corporation
665.1
2
JPMorgan
Chase & Co.
329.6
3
Wachovia Corporation
305.1
4
Wells Fargo & Company
632.7
5
Citigroup, Inc.
916.1
6
Washington Mutual, Inc.
261.5
7
U.S. Bancorp
138.1
8
SunTrust Banks, Inc.
187.5
9
HSBC
222.2
Q3 2005 Managed
Loans
10
Capital One/ North Fork (Pro Forma)
138.4


44
We have secured a broad portfolio of growth
We have secured a broad portfolio of growth
platforms in attractive markets with end game
platforms in attractive markets with end game
positioning
positioning
Local Banking
Local Banking
Customer Access
Customer Access
National Lending
National Lending
Note: Texas and Louisiana ranks are based on state retail deposit rank. NYC rank based on New York MSA retail deposit rank.  As of 6/30/05.  US Card ranking
based on $ outstandings, Auto on volume originations, Mortgage and Home Equity on $ originations, Small Business on card volumes, SBA on $ originations,
and UK card on volume and survey results.
Source: SNL, company reports
# 4 US Card issuer
# 2 Non-captive Auto
originator
# 7 Alt-A Mortgage
originator
# 11 Home Equity
originator
# 2 Small Business
card issuer
# 3 SBA loan originator
# 7 UK card issuer
#1 Louisiana bank
#3 NYC MSA bank
#12 Texas bank
Two successful de novo
models
Winning small business
and middle market
banking model (North
Fork)
Winning consumer and
small business growth
model (Hibernia)
Over 50 M accounts
3 million COF
accounts in NYC
MSA
Leading Brand
Every channel


45
Transaction Summary and Strategic Rationale
Financial Overview
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46
Transaction Summary
$31.18
in
value
per
NFB
share
(.2216x
fixed
exchange
ratio
and
$11.25
per
share
in
cash,
subject
to
proration)
Approximately $14.6 billion
Approximately 64% stock and 36% cash
Fixed number of Capital One shares of approximately 104.2 million
Fixed cash amount of $5.2 billion
Shareholders to elect between common stock or cash subject to proration
None
Tax-free reorganization (tax free to the extent COF stock received)
NFB Chairman & CEO, John Kanas, to head banking at Capital One and
report to Capital One CEO, Rich Fairbank
John Kanas
to be added to the Board
Regulatory, NFB and COF shareholder approvals
4th Quarter 2006
Consideration per Share*
Transaction value*
Consideration mix
Form of Consideration
Stock / Cash election
Walk-away/Caps/Collars
Tax Structure
Bank Management
Board Composition
Approvals
Expected Closing
* Based on COF closing price of $89.92 on 3/10/06


47
Financial Assumptions
I/B/E/S
median
EPS
estimates
for
2006
2007;
and
I/B/E/S
long-term
growth rates for 2008
$275MM pre-tax benefit (phased in 50% in 2007 and 100% in 2008)
comprised of cost savings, balance sheet benefits, and near-term
revenue opportunities
$1.5B in second half 2007 and additional $1.5B in first half 2008
$14B at 10 bps average pretax opportunity cost
Core
deposit
intangibles
equal
to
2.5%
of
NFB’s
core
deposits,
amortized
over
10
years,
utilizing
sum-of-the-years
digits
method
$580MM
Earnings
Synergies
Share repurchases
Balance sheet downsizing
Identifiable intangibles
Restructuring charge and
transaction costs
Financing
-
At close
-
2007
Dividends
$1.0B financed through parent cash (opportunity cost of 4.5%)
1.0B Tier I hybrid (cost of 7.0%)
0.5B subordinated debt (cost of 6.3%) 
2.7B senior debt (cost of 5.7%)
$5.2B Total
$0.5B Tier I hybrid for partial financing of share repurchase
COF current dividend level and policy maintained, subject to
COF board review


48
Pro Forma Earnings Impact to 2007 and 2008
Pro Forma Earnings Impact to 2007 and 2008
($ in millions)
2007
2008
COF GAAP earnings
(1)
$2,720
$3,122
NFB GAAP earnings
(1)
920
1,007
After Tax Impacts
Estimated synergies
$89
$179
Financing costs
(2)
(206)
(276)
Expensed Restructuring Charges
(59)
(59)
Incremental CDI amortization
(4)
(89)
(82)
Pro forma GAAP earnings
$3,355
$3,869
Pro forma operating earnings
(5)
3,414
3,928
Pro forma cash operating earnings
(6)
3,563
4,062
(1)
(2)
(3)
(4)
(5)
(6)
Pro forma GAAP earnings plus expensed restructuring charges.
Pro forma operating earnings plus after-tax CDI amortization.
Includes expense related to capital market financings and use of balance sheet cash for the transaction and subsequent share
repurchases.
Based on I/B/E/S median earnings estimates as of 3/10/06 for 2007 and I/B/E/S long term growth rate of 9.5% for NFB and 13.3% for COF for 2008.
Opportunity cost of restructuring charges, transaction costs, and foregone margin on balance sheet downsizing.
Includes incremental CDI amortization related to CDI created in the transaction.
Other Costs
(3)
(20)
(22)


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The transaction is expected to be accretive on an
The transaction is expected to be accretive on an
operating basis in 2008
operating basis in 2008
($ in millions)
2007
2008
Pro Forma GAAP Earnings
$3,355
$3,869
Pro Forma Operating Earnings
3,414
3,928
Pro Forma Cash Operating Earnings
3,563
4,062
Standalone GAAP EPS
$8.62
$9.77
Pro Forma GAAP EPS
8.06
9.66
Accretion/(Dilution)
(6.5%)
(1.1%)
Standalone Operating EPS
$8.62
$9.77
Pro Forma Operating EPS
8.20
9.81
Accretion/(Dilution)
(4.9%)
0.4%
Standalone Cash Operating EPS
$8.76
$9.89
Pro Forma Cash Operating EPS
8.56
10.14
Accretion/(Dilution)
(2.3%)
2.6%


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Estimated 2008 Pretax Synergies
Estimated 2008 Pretax Synergies
Identified, near-term synergies
Assumes 50% achieved in 2007 and 100% achieved in 2008
Assumes 50% achieved in 2007 and 100% achieved in 2008
($ in millions)
Pretax
2008
Synergy
Expense
$ 110¹
Balance sheet benefits
35
Revenue opportunities
130
Total
$275
1 –
Net of $30M of estimated expense increase for technology, operations, and infrastructure


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Estimated merger related costs
Estimated merger related costs
($ in millions)
Change-in-Control
Other HR
Operations / IT
$350
60
$530
50
$580
Pre-tax impact
Other (including brand)
40
Total Restructuring Costs
Transaction Costs
Total Merger Related Costs
80


52
7.7%
6.1%
6.9%
5.4%
0%
1%
2%
3%
4%
5%
6%
7%
8%
9%
10%
COF Standalone 12/31/2005
12/31/2006
12/31/2007
12/31/2008
COF remains well capitalized with strong capital
COF remains well capitalized with strong capital
generation over time
generation over time
Adjusted TCR :
5.7%
6.5%
7.3%
Notes:
Capital ratios include estimated impact of share repurchases in 2007 and 2008. Adjusted TCR includes $1.0B in hybrid capital in 2006
and an incremental $0.5B hybrid capital in 2007, receiving 50% equity treatment.
Pro Forma Tangible Common Equity/Tangible Managed Assets
Estimated
Transaction Close


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