Capital One Financial Corporation SWOT and PESTLE Analysis

Strengths

1. Brand: Capital One is a Fortune 500 company and one of the most leading banks in US. Offers a wide variety of financial products under both retail banking as well as corporate banking. It has a strong base of over 40000 employees.

2. Strong Financial Performance: Earnings growth of the firm is more than the industry average. A continuous growth in the total revenues of the firm since 2011. Capital One's heavy concentration in credit cards has been highly beneficial to its shareholders. This is because credit card loans generate significantly more interest income than residential mortgage loans or most types of commercial loans. In its latest earning release, Capital One's $273 billion in earning assets yielded 7.38%. That's more than twice the average earning-asset yield of the nation's 10 biggest traditional banks, which was 3.14% in the most recent quarter.

3. Capital One Finance is technologically very strong: They have a very high focus on research and Development, continuously innovating and adapting to the new technologies in order to keep abreast with the Digital era and to increase the ease of use and convenience for its customers. InformationWeek magazine ranked Capital One as the #1 Most Innovative User of Business Technology in 2016.

4. Market share: Capital One is the fourth largest issuer of Visa and MasterCards in the USA. It had a 7.9% market share by purchase volume in 2016. Capital One is also the 4th largest bank auto lender, with a market share of 4.2% in 2016.

Political

1. Capital One contributes for various political causes through their proper channels: Capital One makes frequent contributions to political parties. Their contributions are in accordance with their Corporate and PAC political Contributions Guidelines. Contributions for federal offices, state and local offices are made through the Capital One Financial Corporation Associates Political Fund. They also make contributions to certain trade association PACs to which Capital One belongs. Periodic contributions are made to leadership PACs of particular members of Congress.

Social

1. Impact of negative social perceptions: Adverse perceptions regarding their reputation in the consumer, commercial and funding markets could lead to difficulties in generating and maintaining accounts as well as in financing them. In particular, negative public perceptions regarding their reputation could lead to decreases in the levels of deposits that consumer and commercial customers and potential customers choose to maintain with Capital One or significantly increase the costs of attracting and retaining customers. In addition, negative perceptions regarding certain industries or clients could also prompt Capital One to cease business activities associated with those industries or clients. Negative public opinion or damage to their brand could also result from actual or alleged conduct in any number of activities or circumstances, including lending practices, security breaches, regulatory compliance, corporate governance, including the use and protection of customer information and sales and marketing, and from actions taken by regulators or other persons in response to such conduct. Their efforts can fall short of their customers’ and the public’s heightened expectations of companies of their size with rigorous data, privacy and compliance practices, and could further harm their reputation.

2. Impact on business relationships: Third parties with whom Capital One has important relationships may take actions over which they have limited control that could negatively impact perceptions about their or the financial services industry as a whole. The proliferation of social media may increase the likelihood that negative public opinion can spread like wildfire and go viral instantly.

The unpublished sections of the entire PESTLE / PESTEL analysis is available in the 'Complete Report' on purchase.