Capital One's External Environment and Essay

International Position

Capital One has a good position in the Canadian and British markets. The international credit card business accounts for 11.3% of total revenue in the credit card operating segment (2009 Capital One Annual Report). Capital One does not have retail banking in Canada but does have it in the UK, although that part of the business is relatively minor. In credit cards, the UK business declined 14.6% in 2009 while the Canadian business increased 9.8%, reflecting the states of those two respective economies during the downturn.

Conclusions

The recent acquisitions by Capital One fit well within the company's strategy. Capital One has maintained its monoline focus on consumer lending with its expansion into retail banking. In addition, the company has expanded slowly, giving its management time to absorb the new banks and gain the knowledge and experience needed to increase the pace of such expansions in the future. The economic climate is relatively good, with the chances of recovery strong.The company's strong risk management has allowed it to emerge from the economic crisis in good financial condition. As a result, Capital One is able to continue to pursue its expansion into retail banking. Sustaining growth through acquisition is not only feasible but it is recommended, as Capital One will need to build an integrated retail banking network from the existing patchwork network in order to achieve true competitive advantage in retail banking.

Works Cited:

Capital One 2009 Annual Report. Retrieved May 16, 2010 from https://materials.proxyvote.com/Approved/14040H/20100301/AR_55174/HTML2/capital_one-ar2009_0002.htm

MSN Moneycentral:: Capital One. (2010). Retrieved May 16, 2010 from http://moneycentral.msn.com/detail/stock_quote?Symbol=COF

O'Hara, T. (2005). Capital One to buy New Orleans bank. Washington Post. Retrieved May 16, 2010 from http://www.washingtonpost.com/wp-dyn/articles/A12268-2005Mar6.html

Schultz, J. (2010). What the credit card act means for you. New York Times. Retrieved May 16, 2010 from http://bucks.blogs.nytimes.com/2010/02/22/what-the-credit-card-act-means-for-you/.....