Friday 21st of January 2022 05:37:42 AM

Ally Financial Q4 earnings rise as auto finance gains offset insurance, mortgage dips

  • Ally Financial (NYSE:ALLY) stock slides 2.8% in premarket trading after Q4 earnings come in higher than expected. Financial stocks, one of the best-performing sectors in 2021, come under pressure in premarket trading.
  • Q4 adjusted EPS of $2.02, exceeding the average analyst estimate of $1.97; declined from $2.16 in Q3 but rose from $1.60 in Q4 2020.
  • Q4 adjusted total net revenue of $2.20B, beating the $2.07B consensus, grew from $2.11B in Q3 and $1.88B in Q4 2020.
  • Q4 core preprovision net revenue of $1.11B was little changed from Q3 and higher than $856M in the year-ago quarter.
  • Provision for credit losses of $210M increased from $76M in Q3 and $102M in the year-ago quarter, reflecting the acquisition of Fair Square Financial.
  • Noninterest expense of$1.09B increased from $1.00B in Q3 and $1.02B in Q4 2020.
  • Auto finance pretax income of $839M rose $276M from the year-ago quarter on higher net financing revenue, lower provision for credit losses, and lower noninterest expense.
  • Consumer auto originations rose to $10.9B from $9.1B a year ago; comprised of $7.0B of used retail volume, $3.0B of new retail volume, and $0.9B of leases.
  • Insurance pretax income of $91M declined $92M from a year ago, mostly due to a $24M increase in the fair value of equity securities during Q4 compared with a $11M increase i the fair value of equity securities in the prior-year quarter.
  • Quarterly written premiums were $268M, down $44M Y/Y, on lower dealer inventory levels and light vehicle sales.
  • Corporate finance pretax income of $73M rose $9M Y/Y; revenue from co-investments, fee income and syndication activities was partially offset by higher provision for credit losses due to the establishment of specific reserves and asset expansion.
  • Mortgage finance pretax income was $3M, down $4M Y/Y; lower other revenue from normalizing gain on sale margins was largely offset by higher net financing revenue due to lower premium amortization and balance growth.
  • Q4 adjusted efficiency ratio of 44.4% increases from 41.7% in Q3 and falls from 49.8% in the year-ago quarter.
  • Retail deposits of $134.7B were $134.7B at quarter-end, up $3.1B from the end of Q3.
  • Ally (ALLY) added 28K customers to its retail deposit customer base in Q4 to 2.48M customers at year-end.
  • Conference call at 9:00 AM ET.
  • Earlier, Ally Financial (ALLY) non-GAAP EPS of $2.02 beats by $0.05


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