Capital One Financial has agreed to a $425 million class-action settlement with customers who claimed the bank misled them about deposits in its 360 Savings high-yield program. The proposed deal, which received preliminary judicial approval this week after an earlier version was rejected, covers approximately 3.2 million accountholders whose rates were reduced without proper notice between 2019 and 2024. Under the settlement, eligible customers will receive refunds based on the difference between the promised APY and the rate actually paid, with estimated payouts ranging from $30 to $1,200 per depositor depending on account balances and duration of the rate cuts.

After New York Attorney General Letitia James objected to the initial terms for insufficient relief and transparency, a federal judge granted preliminary approval on Monday to Capital One’s amended settlement framework. The revised agreement includes a third-party administrator to verify notices sent to customers, expanded disclosures about rate changes and cap periods, and enhanced oversight provisions for an 18-month compliance period. If final approval is secured by Q3 2026, Capital One expects to begin distributing refunds in Q4, with administrative costs estimated at $12 million.

Shares of Capital One fell by roughly 6.5% in midday trading following President Trump’s announcement of a one-year cap limiting credit card APRs to 10%, effective January 20. The Federal Reserve reported that U.S. card APRs averaged just under 21% as of November 2025. Industry lobby groups warn that such a cap could restrict lending to lower-score borrowers and depress consumer spending, given that issuers price risk through variable rates. Market analysts note the practical challenges of implementing a broad rate cap within weeks and view the pullback as a potential buying opportunity, forecasting volatility through the implementation window.

A 10% maximum APR could disproportionately affect Capital One’s subprime and near-prime credit segments, which currently carry APRs between 18% and 29%. If issued, the cap may force the bank to tighten underwriting or reduce credit limits for higher-risk consumers, potentially shrinking its receivables by an estimated $10 billion. Conversely, the measure could lower funding costs and credit losses for the broader portfolio, shaving an estimated 50 basis points off net interest margin, according to an independent analysis by Credit Risk Analytics.