For the third consecutive quarter, Ally Financial Inc. has reported a profit as consumers and dealers financed a higher number of US car and truck purchases. Ally Financial Inc. is the auto and mortgage lender formerly known as GMAC Inc.
In the third quarter, Ally’s net income was $269 million, compared with a net loss of $767 million in the same period a year ago. Ally is 56.3% owned by the US Treasury and doesn’t have publicly traded shares. In a statement, Ally stated that all of its operating segments were profitable.
Before the results were announced, Mirko Mikelic, a money manager at Fifth Third Asset Management in Grand Rapids, Mich., said, “Everything is moving along pretty well on the auto side.”
Mikelic, who helps oversee about $13 billion of bonds, added that they are benefiting from the recovery in the auto sector. Ally CEO Michael Carpenter, 63, seeks to bring the company back to its core mission of financing vehicle purchases after losses of billions of dollars at its home-loan unit led to a US bailout of over $17 billion.
Ally reported that the mortgage business posted a $154 million pretax profit from continuing operations, compared with a $652 million loss a year earlier.
Net income from continuing operations in North American auto finance had climbed to $568 million compared to $272 million in the same period the previous year. Ally revealed that profit had fallen from the second quarter, when net income was $630 million. [via autonews - sub. required]