Ally Financial originations climb 7.6%

Ally Financial ’s fourth-quarter auto originations climbed year over year as the bank prioritized its auto lending business. The Detroit-based lender’s auto originations hit $10.3 billion, up 7.6% YoY and 9.6% quarter over quarter , according to the Ally earnings supplement published today. Used-vehicle originations totaled $6 billion, followed by new-vehicle originations at $3.3 billion and lease transactions at $1 billion. Full-year originations were $39.2 billion, down 0.8% YoY. Ally’s bump in auto originations are in line with YoY increases reported by other auto lenders in Q4. According to earnings reports, in Q4: Bank of America ’s origination volume increased 11.5% YoY; Capital One 's auto originations increased 52.7% YoY; Chase Auto ’s originations rose 7.1% YoY; Huntington Auto Finance ’s originations soared 83.3% YoY; U.S. Bank ’s indirect loan and lease originations increased 27.3% YoY; and Wells Fargo Auto ’s originations jumped 51.5% YoY. Application volume rises Auto applications totaled 3.5 million in Q4, up 4.7% YoY, as full-year applications hit 14.6 million in 2024, up 5.8% YoY, according to the supplement. “We remain committed to the success of our more than 20,000 dealers, and I'm encouraged by the trends we're seeing in application flow to further strengthen and grow our position as the leading bank auto finance lender in the country,” Chief Executive Michael Rhodes said on the company’s earnings call today. Rhodes became CEO in April 2024 . The bank’s retail auto originated yield was 10.4% in Q4, with 44% of consumers in the highest credit quality tier, Rhodes said, noting that yields were “driven by strong application flow and dynamic and selective underwriting.” Ally’s loan and lease portfolio shrunk 3.1% YoY to $91.3 billion, down 0.3% QoQ, according to the supplement. Ally eyes simplified structure The increase in auto originations comes as the lender today announced a definitive agreement with CardWorks and its wholly owned bank subsidiary, Merrick Bank , for the purchase of Ally’s credit card business in 2025, according to an Ally press release. Ally’s credit card business carries a portfolio of $2.3 billion in credit card receivables and includes1.3 million active cardholders as of Dec. 31, 2024, according to the release. In addition to shedding its credit card business , Ally plans to halt new mortgage loan originations on Jan. 31 as the lender looks to hone in on its core businesses, Rhodes said on the earnings call. “Card is a great business, and we have a great team,” he said. “However, I believe our path to deliver mid-teens returns is through the power of focus.” ‘Choppy’ credit performance Credit performance was mixed across the lender’s auto book in Q4. “Credit performance throughout 2024 was choppy,” Chief Financial Officer Russ Hutchinson said. “We certainly expect to benefit from portfolio turnover in 2025, but we acknowledge the macro environment remains uncertain.” Fourth-quarter credit changes across the auto book, according to Ally’s presentation, include: Accounts more than 30-days delinquent fell 3 basis points (bps) YoY but rose 15 bps quarter over quarter to 4.39%; Loans 60-days past due rose 2 bps YoY but fell 1 bps QoQ to 1.18%; Net charge-offs came in at 2.34%, up 13 bps YoY and 10 bps QoQ; Allowance for auto loan losses carried a coverage ratio of 3.78%, up 13 bps YoY but down 2 bps QoQ; and Provision for auto credit losses increased 0.6% YoY but declined 14.5% QoQ to $495 million. “As we've discussed previously, the 2022 vintage is producing elevated losses relative to expectations at the time of origination across the consumer finance space,” Hutchinson said. “As the portfolio continues to turn over, the 2022 vintages will amortize down.” Meanwhile, the bank’s floorplan outstandings dipped 3.5% YoY and 6.3% QoQ to $16.4 billion, according to the supplement. Shares of Ally Financial [NYSE: ALLY] were trading at $39.65 at market close today, up 3.9% from market open. Ally has a market capitalization of $12.1 billion. Auto Finance Summit East 2025 is set for May 12-14 at the JW Marriott Nashville featuring fireside chats with Santander Consumer USA and Chase Auto. Visit autofinance.live for more information. Early bird registration is available here .

Ally Financial originations climb 7.6%

Bank sold credit card business to CardWorks

Capital One auto originations surge 53%

Millennials eye return to vehicle market

Related Posts

CPS’ originations fall 12.3% in Q3

Vroom subsidiary UACC’s originations up 7%

Open Lending certified loans fall 13%

Millennials eye return to vehicle market

Stay Informed with Our Newsletters

The Roadmap Podcast

SPONSORED

Driving Innovation in Automotive Refunds: How Onbe and Allied Solutions Are Modernizing the Payment Experience

Navigating the Margin Squeeze: EVs, Tariffs & Pricing — A Q&A with Earnix

Enhancing credit approaches to boost conversion and dealer loyalty

Welcome Back!

Retrieve your password