New York, January 13, 2026, 11:03 AM EST — Regular session
- Capital One shares climbed roughly 0.3% in late morning trading, rebounding from a steep decline the previous day.
- Traders are digesting a proposed 10% cap on credit-card interest rates, set to take effect Jan. 20 for one year.
- A judge has given preliminary approval to a revised $425 million settlement related to Capital One’s 360 Savings rates.
Shares of Capital One Financial Corp ticked up Tuesday, clawing back a bit after Monday’s dip. Investors are wrestling with how aggressive Washington might get on capping credit-card interest rates—and what that could spell for lenders reliant on card business. By late morning, the stock was trading around $233.84, up roughly 0.3%.
Policy risk is in focus. U.S. President Donald Trump has proposed a 10% cap on credit-card interest rates for one year starting Jan. 20, but hasn’t specified how it would be enforced. This rattled lenders and card issuers who depend on those high yields to offset unsecured-borrowing losses. UBS Global analysts noted that “it would take an Act of Congress” to implement such a cap, citing legal challenges to any unilateral action. (Reuters)
The pushback is already mounting. JPMorgan Chase CFO Jeremy Barnum warned reporters that a rate cap “would be very bad for consumers, very bad for the economy,” saying banks would have no choice but to scale back and rethink their business if forced to lower pricing. The Federal Reserve’s consumer credit report showed average credit card interest rates at 20.97% in November, highlighting just how wide the gap would be under a 10% cap. (Reuters)
Even though the chances of new legislation seem slim, the looming threat is already influencing the market because credit cards rank among the highest-return products in the industry. Since these loans are unsecured—meaning no collateral—that pushes lenders to charge higher rates to offset default risks. Truist Securities noted in a report: “We estimate it would swing the business to unprofitable if enacted,” with subprime cards, or those issued to lower-credit-score borrowers, likely to suffer the most, according to a Reuters review of analyst opinions. (Reuters)
Capital One is also wrestling with its own issues. On Monday, a federal judge gave preliminary approval to a revised $425 million class action settlement involving depositors who claimed the bank underpaid interest on 360 Savings accounts. This came after an earlier settlement was rejected. Depositors’ attorney Philip Black described it as “a great result for the class.” (Reuters)
New York Attorney General Letitia James announced she will drop the state’s separate lawsuit if the updated settlement gets the final green light. According to her office, Capital One would need to cough up $425 million in restitution, with about $34 million earmarked for New Yorkers holding 360 Savings accounts. (New York State Attorney General)
Tuesday’s trading indicated investors saw the settlement as less threatening than the broader policy risks. The updated agreement also forces Capital One to match the older 360 Savings rate to the higher 360 Performance Savings rate and maintain both account options for at least two years—a cost some investors might factor into future earnings forecasts.
Capital One is gearing up for a key moment. The bank will report its fourth-quarter 2025 earnings around 4:05 p.m. ET on Jan. 22, with a conference call set for 5:00 p.m. ET, the company confirmed. Investors will be watching closely for insights on credit trends and any implications from Washington’s latest rate-cap efforts. (Capital One Investor Relations)
The company enters this report heavily exposed to U.S. card economics following its acquisition of Discover Financial Services, finalized last May. (Capital One Investor Relations)
The downside is clear. Should the White House push hard for a cap, or if lawmakers gain traction on a bill, lenders might clamp down—tightening credit, reducing limits, and scaling back rewards. That would leave fewer borrowers able to carry balances month to month. Plus, the depositor settlement still awaits final court approval, so the legal costs aren’t fully settled yet.
Investors have two key dates to track this week: Jan. 20, when Trump has called for the 10% cap to kick in, and Jan. 22, when Capital One reports earnings. The final approval hearing for the savings-account settlement will take place on April 20. (Capital One 360 Litigation)
