Reuters Capital One Financial39;s profit fell 61 in the second quarter, it reported on Tuesday, as it set aside more money to cover losses on loans.

Net income available to common stockholders fell to 531 million or 1.38 per share versus 1.35 billion or 3.52 per share a year earlier.

The U.S. consumer remains a source of strength in the overall economy, CEO Richard Fairbank told analysts on a conference call.

In this high interest rate environment, the cost of new borrowing has gone up for mortgages, auto loans and credit cards, he said, adding that this has stretched some borrowers, but that consumers are in reasonably good shape.

Capital One set aside 3.9 billion in provisions for loan losses, up from 2.5 billion a year earlier.

Net chargeoffs, or debts that are unlikely to be recovered, rose to 2.6 billion from 2.2 billion a year earlier.

Capital One shares were down about 0.9 in afterhours trading on Tuesday.

The company plans to strengthen its domestic card and national consumer banking businesses, while increasing its spending on marketing, Fairbank said.

Meanwhile, the lender is all in on its work to complete its purchase of Discover Financial, he said.

The 35 billion acquisition, once finalized, will grant the company access to Discover39;s credit card network, which is the fourthlargest in the United States.

If approved, the deal is expected to be completed late this year or early next year, Fairbank said.

Opponents of the deal say that the merger…