Ally Financial Inc. just finished its second-strongest quarter of originations in the bank’s history. Ally reported $10.9 billion in originations in the second quarter of 2014, up $1.7 billion over the last quarter and $1.1 billion over last year.
The auto finance group reported pre-tax revenue of $461 million on the quarter, up $122 million from 1Q and $79 million from the same period last year.
The company also reported a record $3.1 billion in used originations in its earnings call earlier today. Ally expects used car prices, which have held steady for the first half of the year, to drop slightly in second half. Two major factors have kept the price of used cars high so far this year, according to the bank. One is the pricing discipline on new cars shown by OEMs, and the other is that demand continues to outpace supply, but as lease returns pick up over the next several years, this can be expected to change.
Regarding the recent New York Times article that has been ricocheting around industry regarding subprime auto loans, a representative from the bank said, “That article does not describe the nature of the business we are in and it does not describe the way we do business.” And Ally is focused on credit tieres to the north of those discussed in the article. Prime and superprime loans together comprise 70% of its originations on the year so far. That number is unchanged from last year and down 2% from 2012.
