Banking and Finance Law Daily Wrap Up, FINANCIAL STABILITY—Capital One files lawsuit against FDIC over bank failure special assessment calculation, (Sep 12, 2025)

By Jeff Williams

The company told the court that the FDIC improperly estimated the bank’s share of a special assessment stemming from the failures of Silicon Valley Bank and Signature Bank.

Capital One, National Association (CONA) has filed a complaint in the U.S. District Court for the Eastern District of Virginia against the Federal Deposit Insurance Corporation alleging that the FDIC has made “impermissible attempts, dating back to 2023, to collect an outsized and improperly calculated special assessment of approximately $475 million from CONA—$149 million of which CONA does not owe” stemming from the order the FDIC issued seeking to make uninsured depositors whole after the failures of California-based Silicon Valley Bank and New York’s Signature Bank.

The FDIC issued a national rule to implement a special assessment on 114 banking organizations to collect the $16.3 billion in costs from the failure of the banks attributable to the protection of uninsured depositors (see Banking and Finance Law Daily, Nov. 17, 2023).

CONA said in the complaint that the special assessment rule “specifically requires” the assessments on each bank to be based on a Bank’s Call Report as of the later of Nov. 2, 2023, or the date of the bank’s most recent amendment to its Call Report arising from, or confirmed through, the FDIC’s Assessment Reporting Review (Capital One, National Association v. Federal Deposit Insurance Corporation, No. 1:25-cv-1515 (E. D. Va. Sept. 10, 2025)).

The company said it filed the complaint because the FTC’s special assessment for CONA included an uninsured $56 billion intercompany position between CONA and its wholly owned subsidiary Capital One Funding LLC, as well as a $189 million intercompany position between CONA and wholly owned subsidiary Capital One Auto Receivables LLC, even though those amounts were not reported on CONA’s Dec. 31, 2022, Call Report as of Nov. 2, 2023, nor as of an amended Dec. 31, 2022 Call Report.

CONA disputed in the lawsuit that the total intercompany position is an uninsured deposit that is subject to the special assessment rule, stating that the position “does not meet the statutory definition of ‘deposit’ in the Federal Deposit Insurance Act (‘FDIA’).”

CONA also said that the intercompany position is “not reflected as a deposit on the operative CONA Call Report from which the Special Assessment Rule required CONA’s special assessment to be calculated.” CONA noted that though its original Dec. 31, 2022, Call Report “erroneously included” the intercompany position as an uninsured deposit, the company amended that report June 29, 2023, to address the error and therefore the FDIC should not have included the position in its calculation.

Finally, CONA said, it “effectuated a retroactive distribution of nearly all of the $56 billion Intercompany Position, effective as of October 1, 2022, such that the Intercompany Position was reduced to approximately $2 billion prior to December 31, 2022.”

Despite the June 2023 revision, “the FDIC included the Intercompany Position in its calculation of CONA’s uninsured deposits, relying on a calculation of its own making rather than on the Revised December 2022 Call Report,” CONA said, adding: “According to the FDIC’s erroneous calculation including the Intercompany Position, CONA’s total special assessment is approximately $475 million, whereas the special assessment properly calculated based on the Revised December 2022 Call Report, is approximately $325 million.”

The FDIC invoiced CONA July 8, 2025, for approximately $84 million more than the company actually owed for its quarterly payment, CONA said. The company said it expects subsequent quarterly invoices based on the FDIC’s calculation to total approximately $76 million plus interest, the company said, adding: "In total, the FDIC has estimated that CONA will owe approximately $149 million more than what it should for its special assessment across the whole special assessment period.”

Through a “series of communications” with the FDIC for the past two years CONA has “demonstrated that the Intercompany Position has been wrongly included in the invoiced special assessment,” the bank said. But the FDIC “nonetheless persists in seeking to collect a special assessment based on its erroneous calculation” and told the company in a Sept. 8, 2025, letter that it disagrees with CONA’s treatment of the intercompany position and that the company could either pursue an administrative appeal or pursue litigation, CONA said.

CONA asked the court to issue a declaratory judgement in the company’s favor regarding the calculation of the assessment, which it said would “resolve the parties’ dispute going forward, save the parties substantial future costs and expense, and conserve judicial resources.”

Attorneys: John Savage Moran (McGuireWoods LLP) for Capital One, National Association.

Companies: Capital One, National Association

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