Lenders Warn of Mid-Decade Auto Finance Credit Debacle
DALLAS — “Those who cannot remember the past are condemned to repeat it.”
Auto financiers will likely be reliving the past by about mid-decade as the lessons of the credit crisis fall away, said a panel of risk managers at the Auto Finance Risk Summit last month. Now that competition is creeping back into the marketplace, finance company executives are starting to think about how they will manage to withstand aggressive lending tactics.
“That’s the hallway conversation,” said Doug Clyma, senior vice president of credit risk management at AmeriCredit Corp., at the conference. “We say we’re going to hold the line, we’re going to make risk important, and that we’re not going to go back to a growth-only mode. But somebody’s going to do it; somebody’s going to chase [volume]. The most difficult thing will be to lay back. Will your organization have the fortitude to not join the herd going off the cliff?”
To read the rest of this article, join Auto Finance News VIP. To be become a member, click here: http://autofinews1.wpengine.com/page/get-vip-access
