Capital One auto originations up 28%

Capital One ’s auto originations increased in the second quarter as the bank leaned into growth and saw improved credit performance, while it also rolled out a fraud detection tool. Auto originations rose to $10.9 billion, up 28.3% year over year and 17.9% quarter over quarter , according to the bank’s July 22 earnings supplement. The growth was “driven by overall market growth and [the bank's] strong position to pursue resilient growth in the current marketplace,” Chief Executive and President Richard Fairbank said during the Q2 earnings call. Capital One joins lenders such as Ally Financial , Chase Auto , Huntington Auto Finance and Wells Fargo Auto in posting Q2 auto originations growth. Auto outstandings came in at $80 billion, up 7.6% YoY and 3% QoQ, according to the supplement. Capital One was the fifth-largest auto lender by outstandings at yearend 2024 with a portfolio of $76.8 billion, according to the latest Big Wheels Rankings Data . Credit performance improved across the bank’s auto portfolio. The rate of auto loans 30-plus days delinquent stood at 4.84%, down 83 basis points (bps) YoY and 9 bps QoQ, according to the release. Auto net charge-offs sat at 1.25%, down 56 bps YoY and 30 bps QoQ. “As the result of our choice to tighten credit and pull back in 2022, auto charge-offs are improving on a seasonally adjusted basis,” Fairbank said during the call. The bank’s allowance for auto loan losses totaled $1.8 billion in Q2, or a coverage ratio of 2.3%, up 40 bps YoY and 10 bps QoQ, according to an Auto Finance News analysis of the bank’s earnings supplements. The bank is keeping an eye on consumer credit health amid tariffs and resumption of student loan payments, Fairbank said. “We're watching the performance of card and auto customers with student loans and especially those customers whose student loans are now being reported as delinquent,” he said. “So far, we haven't seen any spillover effects in these segments, but we'll continue to monitor this closely.” Capital One launches ProtectID Meanwhile, Capital One continues to invest in its technology stack, Fairbank said, noting that “only the companies built on a modern tech stack and deeply invested in data will be in a position to reinvent their business model to put AI at the heart of operations , risk management and customer experience.” “Only the companies built on a modern tech stack and deeply invested in data will be in a position to reinvent their business model [with] AI." -- Richard Fairbank, Capital One Capital One this week announced ProtectID, a real-time fraud detection tool embedded in the lender’s Dealer Navigator platform. The tool uses the bank’s proprietary fraud models and data combined with AI and machine learning capabilities to flag potential risks tied to consumer applications. The tool uses a soft pull to evaluate applications, then alerts dealers to suspicious activity, identifying what information is potentially risky and providing steps dealers should take, according to the bank. For the borrower whose application was flagged, the tool sends a verification link to allow the person to confirm their identity. “Fraud is on the rise everywhere,” Sanjiv Yajnik , president of financial services at the bank, said during a July 21 online Capital One roundtable discussion on the tool. “It’s a hard problem to crack.” As more consumers shop online, fraud has increased, Dylan Bullock , general sales manager of Grapevine Dodge Chrysler Jeep Ram in Grapevine, Texas, said during the discussion. The dealership piloted ProtectID for about seven months and provided feedback that helped create the tool, according to Capital One. “We have the emergence of many digital retailing tools, and customers are wanting to do more of the deal online,” Bullock said. “With that, we've seen an increase in fraud. We see it every single month. There are situations … some of which we prevent and some of which we aren't always able to.” "We've seen an increase in fraud. We see it every single month." -- Dylan Bullock, Grapevine Dodge Chrysler Jeep Ram Capital One taps its consumer credit product data to build knowledge on fraud and inform its detection systems, Yajnik said. “With credit cards, there are transactions happening every single second of the day across the entire world,” he said, noting that the data can point to fraud rings at work. “We do billions of dollars of transactions daily. We map all the transactions to create links between different merchants and people, and we use machine learning and AI to bring that knowledge together so that the next time a customer is doing a transaction, we have a fair amount of certainty on whether that is a bona fide customer or not.” Shares of Capital One Financial Corp. [NYSE: COF] were up 0.9 % at market close today to $ 219.46 . Capital One has a market capitalization of $ 140.5 billion . Auto Finance Summit, the premier industry event for auto lending and leasing, returns Oct. 15-17 at the Bellagio Las Vegas. To learn more about the 2025 event and register, visit www.AutoFinance.live/AFS .

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