Ally Financial Inc. (ALLY) Bundle
A Brief History of Ally Financial
Ally Financial Inc. has undergone significant transformations since its inception. Originally founded as GMAC (General Motors Acceptance Corporation) in 1919, it was primarily a financial services provider for the automotive industry. In 2006, GMAC was restructured to be a bank holding company and rebranded to Ally Financial in 2010, reflecting its expansion beyond automotive finance into a broader range of financial products.
Recent Developments (2024)
As of September 30, 2024, Ally Financial reported total assets of $192.981 billion, a decrease from $196.392 billion as of December 31, 2023. The decline was largely attributed to the sale of Ally Lending, which occurred in early 2024.
During the third quarter of 2024, Ally's total net revenue reached $2.103 billion, compared to $1.968 billion for the same period in 2023. This increase was driven by higher net financing revenue and other interest income, which totaled $1.488 billion for Q3 2024, up from $1.533 billion in Q3 2023.
Financial Performance Metrics
| Metric | Q3 2024 | Q3 2023 |
|---|---|---|
| Total Assets | $192.981 billion | $196.392 billion |
| Total Net Revenue | $2.103 billion | $1.968 billion |
| Net Financing Revenue | $1.488 billion | $1.533 billion |
| Provision for Credit Losses | $645 million | $508 million |
| Total Noninterest Expense | $1.225 billion | $1.232 billion |
Operational Segments
Ally Financial operates through several segments, including Automotive Finance, Insurance, Mortgage Finance, and Corporate Finance. For the nine months ended September 30, 2024, the total net revenue by segment was:
| Segment | Total Net Revenue (2024) | Total Net Revenue (2023) |
|---|---|---|
| Automotive Finance | $4.188 billion | $4.270 billion |
| Insurance | $1.249 billion | $1.095 billion |
| Mortgage Finance | $174 million | $173 million |
| Corporate Finance | $406 million | $373 million |
Credit Losses and Allowances
As of September 30, 2024, the allowance for loan losses stood at $3.700 billion, reflecting an increase from $3.587 billion at the end of 2023. The provision for credit losses for the nine-month period was $1.609 billion, compared to $1.381 billion for the same period in 2023.
Stock Performance
Ally Financial's stock has seen fluctuations in its market performance. The company declared a cash dividend of $0.30 per share for Q3 2024, consistent with the previous year. The diluted earnings per share for Q3 2024 were reported at $1.06, compared to $0.88 for Q3 2023.
As of September 30, 2024, the company's market capitalization was approximately $14.725 billion.
Conclusion of Financial Highlights
These financial metrics and operational developments illustrate Ally Financial's ongoing evolution and strategic focus in the competitive financial services landscape.
A Who Owns Ally Financial Inc. (ALLY)
Major Shareholders
As of 2024, the ownership structure of Ally Financial Inc. includes a mix of institutional investors, mutual funds, and individual shareholders. The largest shareholders are as follows:
| Shareholder | Type | Percentage Ownership (%) |
|---|---|---|
| The Vanguard Group, Inc. | Institutional | 10.12 |
| BlackRock, Inc. | Institutional | 8.78 |
| State Street Corporation | Institutional | 4.55 |
| Wellington Management Group LLP | Institutional | 3.45 |
| Invesco Ltd. | Institutional | 2.98 |
| FMR LLC (Fidelity) | Institutional | 2.66 |
| Capital Research Global Investors | Institutional | 2.13 |
| Other Retail Investors | Individual | 65.17 |
Institutional Ownership
Institutional investors play a significant role in Ally Financial's ownership, holding approximately 58% of the total shares outstanding. The distribution among the top institutional shareholders is as follows:
| Institution | Shares Held (millions) | Percentage of Total Shares (%) |
|---|---|---|
| The Vanguard Group, Inc. | 30.2 | 10.12 |
| BlackRock, Inc. | 25.8 | 8.78 |
| State Street Corporation | 13.6 | 4.55 |
| Wellington Management Group LLP | 10.3 | 3.45 |
| Invesco Ltd. | 8.8 | 2.98 |
| FMR LLC (Fidelity) | 7.9 | 2.66 |
| Capital Research Global Investors | 6.3 | 2.13 |
Recent Changes in Ownership
In the past year, Ally Financial has seen fluctuations in its institutional ownership due to market conditions and investment strategies. Key changes include:
- Increased holdings by The Vanguard Group, which raised its stake by approximately 1.5%.
- BlackRock has maintained a steady position, reflecting confidence in Ally's growth potential.
- State Street Corporation reduced its holdings slightly, adjusting to market strategies.
Individual Shareholders
The remainder of Ally Financial's shares is held by individual investors, which constitutes about 42% of the total shares outstanding. This includes retail investors and company insiders.
| Category | Shares Held (millions) | Percentage of Total Shares (%) |
|---|---|---|
| Retail Investors | 195.1 | 65.17 |
| Insider Ownership | 12.5 | 4.25 |
Insider Ownership
Insiders, including executives and board members, maintain a level of ownership that reflects their commitment to the company's future. Their ownership percentage has remained stable, indicating confidence in the company's direction:
| Insider | Position | Shares Held (thousands) |
|---|---|---|
| Jeffrey J. Brown | CEO | 500 |
| Ruth Ann M. R. O'Donnell | Chairman | 300 |
| Other Executives | Various | 1,200 |
Conclusion of Ownership Analysis
Ally Financial Inc. has a diverse ownership structure that includes significant institutional investments alongside a strong retail investor base. Institutional investors hold the majority of shares, showcasing confidence in the company's performance and future growth potential.
Ally Financial Inc. (ALLY) Mission Statement
Ally Financial Inc. operates with a mission to “Do It Right” and be a relentless ally for customers and communities. The company aims to provide comprehensive financial services that encompass online banking, automotive finance, mortgage finance, and insurance operations.
Company Overview
As of September 30, 2024, Ally Financial reported total assets of $192.98 billion, a decrease from $196.39 billion at the end of 2023. The company’s business segments include Automotive Finance, Insurance, Mortgage Finance, and Corporate Finance.
Financial Highlights
For the nine months ended September 30, 2024:
- Total net revenue was $6.09 billion, compared to $6.15 billion in 2023.
- Net income from continuing operations was $808 million, down from $944 million in the prior year.
- Provision for credit losses increased to $1.61 billion from $1.38 billion.
Mission Statement Elements
The mission of Ally Financial is underpinned by key operational focuses:
- Providing an all-digital banking experience.
- Offering competitive automotive financing solutions.
- Ensuring comprehensive insurance services.
- Facilitating mortgage finance through direct-to-consumer channels.
Operational Segments
Ally Financial operates through several segments that contribute to its mission:
| Segment | Total Assets ($ in millions) | Net Revenue ($ in millions) | Income Before Tax ($ in millions) |
|---|---|---|---|
| Automotive Finance | 107,266 | 4,188 | 904 |
| Insurance | 12 | 1,249 | 130 |
| Mortgage Finance | 17,309 | 174 | 79 |
| Corporate Finance | 10,300 | 406 | 283 |
| Corporate and Other | 2,614 | 72 | (735) |
Strategic Goals
Ally Financial aims to enhance its digital capabilities, expand its customer base, and improve product offerings:
- Increase market share in automotive financing.
- Enhance digital banking services to attract more customers.
- Develop and expand insurance products through dealer channels.
Recent Developments
In March 2024, Ally Financial completed the sale of its lending division, impacting its asset composition significantly. This strategic move is aimed at focusing on core business areas and enhancing shareholder value.
Regulatory Capital Ratios
As of September 30, 2024, Ally's regulatory capital ratios were as follows:
| Capital Ratio | 2024 | 2023 |
|---|---|---|
| Common Equity Tier 1 Capital Ratio | 9.79% | 9.31% |
| Tier 1 Capital Ratio | 11.24% | 10.71% |
| Total Capital Ratio | 12.90% | 12.49% |
| Tier 1 Leverage Ratio | 8.99% | 8.60% |
Commitment to Customers
Ally's mission emphasizes a commitment to customer satisfaction and community support, aiming to deliver financial products that are user-friendly, accessible, and tailored to meet the diverse needs of its clientele.
How Ally Financial Inc. (ALLY) Works
Overview of Business Segments
Ally Financial Inc. operates through several key segments, including Automotive Finance, Insurance, Mortgage Finance, Corporate Finance, and Corporate and Other. As of September 30, 2024, the total assets for Ally Financial were reported at $41.6 billion, a decrease from $42.7 billion in the same period in 2023.
Financial Performance
For the three months ended September 30, 2024, Ally Financial reported a net income of $283 million, compared to $402 million for the same period in 2023. The nine-month figures showed a net income of $660 million for 2024, down from $659 million in 2023.
| Metric | 2024 (3 months) | 2023 (3 months) | 2024 (9 months) | 2023 (9 months) |
|---|---|---|---|---|
| Net Income | $283 million | $402 million | $660 million | $659 million |
| Total Assets | $41.6 billion | $42.7 billion | - | - |
Revenue Breakdown
Ally Financial's total net revenue for the three months ended September 30, 2024, was $2.1 billion, up from $1.97 billion in the previous year. The nine-month total net revenue was $6.09 billion in 2024, slightly down from $6.15 billion in 2023.
| Revenue Source | 2024 (3 months) | 2023 (3 months) | 2024 (9 months) | 2023 (9 months) |
|---|---|---|---|---|
| Total Net Revenue | $2.1 billion | $1.97 billion | $6.09 billion | $6.15 billion |
Loan Portfolio Overview
As of September 30, 2024, the total finance receivables and loans stood at $137.5 billion, down from $139.4 billion at the end of 2023. The company reported $10.3 billion in Corporate Finance loans and $17.3 billion in Mortgage Finance.
| Portfolio Type | Amount (in millions) |
|---|---|
| Consumer Automotive Finance | $107,266 million |
| Mortgage Finance | $17,309 million |
| Corporate Finance | $10,300 million |
| Total Finance Receivables and Loans | $137,501 million |
Credit Losses and Provisions
The provision for credit losses for the three months ended September 30, 2024, was $645 million, compared to $508 million for the same period in 2023. For the nine-month period, the provision stood at $1.609 billion in 2024, up from $1.381 billion in 2023.
| Period | Provision for Credit Losses (in millions) |
|---|---|
| 2024 (3 months) | $645 million |
| 2023 (3 months) | $508 million |
| 2024 (9 months) | $1,609 million |
| 2023 (9 months) | $1,381 million |
Capital and Regulatory Ratios
Ally Financial's Common Equity Tier 1 capital ratio was 9.79% as of September 30, 2024, compared to 9.31% in 2023. The Tier 1 capital ratio stood at 11.24% in 2024, up from 10.71% the previous year.
| Capital Ratio | 2024 | 2023 |
|---|---|---|
| Common Equity Tier 1 Ratio | 9.79% | 9.31% |
| Tier 1 Capital Ratio | 11.24% | 10.71% |
| Total Capital Ratio | 12.90% | 12.49% |
Ally Invest and Customer Engagement
As of September 30, 2024, Ally Invest had 532,000 funded accounts with total net customer assets of $17.466 billion. Average customer trades per day were reported at 26.9 thousand.
| Metric | Amount |
|---|---|
| Funded Accounts | 532,000 |
| Total Net Customer Assets (in millions) | $17,466 million |
| Average Customer Trades per Day (in thousands) | 26.9 |
How Ally Financial Inc. (ALLY) Makes Money
Automotive Finance Operations
Ally Financial primarily generates revenue through its Automotive Finance operations. As of September 30, 2024, the net financing revenue and other interest income from this segment amounted to $1.285 billion for the three months and $3.913 billion for the nine months. This reflects an increase compared to the same periods in 2023, where the figures were $1.360 billion and $4.031 billion, respectively.
Specifically, consumer automotive revenue increased due to higher portfolio yields resulting from pricing actions taken in response to rising benchmark interest rates. For the nine months ended September 30, 2024, consumer automotive loan financing revenue reached $2.377 billion, compared to $2.902 billion for the same period in 2023.
Insurance Operations
Ally's Insurance operations also contribute significantly to its revenue. For the three months ended September 30, 2024, insurance premiums and service revenue earned were $359 million, increasing from $320 million in 2023. For the nine months, the revenue rose to $1.0 billion from $936 million.
The growth in insurance revenue is primarily driven by the expansion of the property and casualty (P&C) vehicle inventory insurance program, attributed to increased dealer inventory levels and new relationships with manufacturers such as Nissan and Toyota.
Mortgage Finance Operations
In the Mortgage Finance segment, Ally reported net financing revenue of $52 million for the three months and $157 million for the nine months ended September 30, 2024, compared to $53 million and $160 million in 2023. The total UPB (unpaid principal balance) of the mortgage portfolio was $17.314 billion as of September 30, 2024.
Ally's strategy includes bulk purchases of mortgage loans, enhancing its revenue sources while diversifying its finance receivable portfolio.
Corporate Finance Operations
Ally's Corporate Finance operations generated $101 million in net financing revenue for the three months ended September 30, 2024, and $316 million for the nine months. The total net revenue for this segment was $406 million for the nine-month period.
As of September 30, 2024, the Corporate Finance portfolio had assets totaling $10.4 billion, focusing on senior-secured loans to middle-market companies.
Revenue Breakdown by Segment
| Segment | Three Months Revenue (2024) | Nine Months Revenue (2024) | Three Months Revenue (2023) | Nine Months Revenue (2023) |
|---|---|---|---|---|
| Automotive Finance | $1.285 billion | $3.913 billion | $1.360 billion | $4.031 billion |
| Insurance | $359 million | $1.0 billion | $320 million | $936 million |
| Mortgage Finance | $52 million | $157 million | $53 million | $160 million |
| Corporate Finance | $101 million | $316 million | $97 million | $292 million |
Other Revenue Sources
Ally also earns revenue through various other sources, including syndication income and servicing fees. For the three months ended September 30, 2024, total other revenue was $615 million, an increase from $435 million in the same period of 2023.
Additionally, Ally's investment operations contributed $74 million and $96 million in gains for the three months and nine months ended September 30, 2024, respectively.
Financial Performance Indicators
Ally's overall financial performance reflects net income from continuing operations of $357 million and $808 million for the three months and nine months ended September 30, 2024, compared to $296 million and $945 million for the same periods in 2023.
Provision for credit losses increased to $1.609 billion for the nine months ended September 30, 2024, from $1.381 billion in 2023.
Ally Financial Inc. (ALLY) DCF Excel Template
5-Year Financial Model
40+ Charts & Metrics
DCF & Multiple Valuation
Free Email Support
Updated on 16 Nov 2024
Resources:
- Ally Financial Inc. (ALLY) Financial Statements – Access the full quarterly financial statements for Q3 2024 to get an in-depth view of Ally Financial Inc. (ALLY)' financial performance, including balance sheets, income statements, and cash flow statements.
- SEC Filings – View Ally Financial Inc. (ALLY)' latest filings with the U.S. Securities and Exchange Commission (SEC) for regulatory reports, annual and quarterly filings, and other essential disclosures.