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Ally’s Earning Drop as Leases and Loans Shrink
Auto retail lending giant Ally Financial Inc. says its net income fell 6% to $248 million in October-December because of higher expenses and a greater provision for lending losses.
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Auto retail lending giant Ally Financial Inc. says its net income fell 6% to $248 million in October-December because of higher expenses and a greater provision for lending losses. Pretax income from continuing operations dropped 12% to $380 million.
Reported net financing revenue for the period slipped 2% to $976 million. Declining used-car values and a shrinking lineup of leasable vehicles ate into financing operations, according to the company.
Ally says used-car deals accounted for 41% of all originations, up four points. The number of lease contracts shrank three points to 8%.
The company wrote $8.2 billion in new leases and loans in the quarter, down 12% from the same period in 2015. General Motors and Fiat Chrysler Automobiles contributed 37% and 27%, respectively, of originations.
For the full year, Ally’s reported net revenue from financing climbed 5% to $3.9 billion. Net income dropped 17% to $1.1 billion compared with 2015, when results were elevated by a one-time gain for the sale of the company’s stake in a Chinese joint venture.
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