The establishment of industrial banks by Ford Credit and GM Financial is expected to lead to lower funding costs, netting a credit positive for the captives. The industrial loan company (ILC) charters the captives received from the FDIC will give them the ability to collect retail deposits. This is a more stable and fiscally accessible source of funds in volatile periods compared with unsecured debt and securitizations due to the FDIC guarantee, Mike Taiano, vice president of Moody’s Ratings financial institutions group, told Auto Finance News. The ability to tap into diversified, stable […]
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