Without naming names, Jeffrey “J.B.” Brown, the new CEO of Ally Financial, had some harsh words for Ally’s corporate culture under his predecessor, Michael Carpenter.
“First and foremost, any time there’s a leadership change at the CEO level there’s an expectation of cultural change,” Brown said Tuesday at the Morgan Stanley U.S. Financials Conference in New York. He said cultural change is “clearly underway” at Ally.
Brown said one of his top priorities is to integrate Ally’s auto finance operation with its online banking operation, and to cross-sell auto finance customers with banking customers and vice versa.
“Cultural change” also includes the personalities at the top. The famously outspoken Carpenter abruptly retired in February, shortly after admitting Ally was surprised and angry at General Motors – Ally’s biggest customer and former parent company – for pulling its lease incentives away from Ally and steering them exclusively to captive finance company GM Financial.
Carpenter said in a Jan. 29 conference call announcing fourth-quarter earnings, “What pisses us off is when we don’t get the chance to compete,” for the lease business. Ally stock hit a 52-week low. To be fair, Carpenter also spoke at length about how Ally saw the changes coming, and how Ally had diversified its customer base so it wouldn’t be seriously hurt by its shrinking share of GM incentives. Brown reiterated the same points this week.
But in recalling “events that transpired in the first quarter,” Brown said on Tuesday, “Ally acted shocked and angry. We really didn’t need that. We missed an opportunity to show what this franchise is capable of.”
