April 22 (Reuters) - Capital One Financial COF.N reported a rise in first-quarter profit on Tuesday, as the consumer lender was helped by a higher income from interest payments on its credit card debt.

Consumers pulled back on discretionary spending amid economic uncertainty, but companies like Capital One are shielded from an industry-wide weakness because of their credit card business.

Interest rates on credit card debt are significantly higher than those on mortgages and other kinds of loans.

Credit card business makes up nearly half of Capital One's loan portfolio. The lender is the third-largest issuer of Visa V.N and Mastercard MA.N credit cards in the United States by balances.

The McLean, Virginia-based company's net interest income — the difference between what it makes on loans and pays out on deposits — rose 7% to $8.01 billion in the quarter.

Capital One's quarterly non-interest income, which primarily consists of interchange income, net of reward expenses, service charges and other customer-related fees, rose nearly 4% to $1.99 billion.

However, company executives have flagged further risks to consumer spending as the economy trudges through a volatile period sparked by President Donald Trump's tariff policy uncertainty.

Net charge-offs, or debts that are unlikely to be recovered, jumped 4.6% to $2.74 billion, the company said.

Capital One's net income available to common stockholders rose to $1.33 billion, or $3.45 per share, in the three months ended March 31, from $1.20 billion, or $3.13 per share, a year earlier.

Shares of the company, which have shed 4.6% in 2025, rose 1.7% in extended trading.

DISCOVER REGULATORY NOD

U.S. banking regulators approved Capital One's $35.3 billion purchase of Discover Financial Services DFS.N last week, paving the way for the combined firms to become the nation's eighth-largest bank.

The deal, which is set to close on May 18, will create the biggest U.S. credit card issuer by balances, and give Capital One control of Discover's extensive card payment network.

(Reporting by Pritam Biswas in Bengaluru; Editing by Alan Barona)

((Pritam.Biswas@thomsonreuters.com))