Capital One Financial Corp.'s U.S. Card segment yesterday reported net income of $340.4 million for the second quarter ended June 30, down 42.5% from $591.9 million for the same period last year. Net card revenues were $2.5 billion, up 4.2% from $2.4 billion. Cap One's net charge-off rate increased sharply, to 6.3% during the second quarter compared with 3.6% a year ago, and its 30 days-plus delinquency rate increased to 3.9% compared with 2.9%. Purchase volume declined slightly, to $26.7 billion compared with $26.9 billion. Cap One's provision for loan losses for the quarter almost doubled compared with the same period last year, to $1.1 billion compared with $538 million. Richard D. Fairbank, Cap One chairman and CEO, told analysts yesterday during a conference call that he expects the company's charge-off rate to reach the low-6% range in the third quarter, rising to about 7% in the fourth quarter. "We've observed continued weakening in economic indicators throughout the first half of the year," he said, adding he expects those trends to continue throughout the year. Fairbank noted that delinquencies longer than 30 days for the quarter improved from roughly 4% during the first quarter of this year, which he attributed to new pricing and fee-policy changes Cap One introduced during the second half of last year.