Strong Auto Finance Performance and …

• Adjusted Earnings Per Share: $0.99

• Core Pretax Income: $418 million

• Net Interest Margin (excluding core OID): 3.45%

• Core ROTCE: 13.6%

• Consumer Originations in Auto Finance: $11 billion

• Origination Yields: 9.82%

• Insurance Written Premiums: $349 million

• Corporate Finance ROE: 31%

• Digital Bank Customer Count: 3.4 million

• Deposit Balances: $143 billion

• Net Financing Revenue: Approximately $1.5 billion

• Adjusted Other Revenue: $531 million

• Adjusted Provision Expense: $384 million

• Adjusted Noninterest Expense: $1.3 billion

• Effective Tax Rate: 19%

• GAAP Earnings Per Share: $1.04

• CET1 Ratio: 9.9%

• Adjusted Tangible Book Value Per Share: $37

• Consolidated Net Charge-Off Rate: 110 basis points

• Retail Auto Net Charge-Off Rate: 1.75%

• 30-plus Day Delinquencies: 4.88%

• Retail Auto Coverage Rate: 3.75%

• Retail Auto Portfolio Yield (excluding hedges): 9.19%

Release Date: July 18, 2025

For the complete transcript of the earnings call, please refer to the full earnings call transcript.

• Ally Financial Inc (NYSE:ALLY) delivered adjusted earnings per share of $0.99 and core pretax income of $418 million, marking double-digit year-over-year growth.

• Net interest margin, excluding core OID, expanded by 10 basis points quarter-over-quarter to 3.45%, indicating strong financial performance.

• The company achieved a core ROTCE of 13.6% in the quarter, demonstrating robust return on tangible common equity.

• Ally Financial Inc (NYSE:ALLY) continues to see strong performance in its Auto Finance business, with consumer originations reaching $11 billion, driven by a record application volume.

• The digital bank segment reported an all-time high of 3.4 million customers, marking 65 consecutive quarters of net customer growth, reinforcing its position as the nation’s largest all-digital bank.

• The sale of the credit card business resulted in a 20 basis points drag on net interest margin, impacting overall financial performance.

• Adjusted provision expense was $384 million, reflecting a 23% decrease from the prior quarter, but still indicating a cautious approach due to macroeconomic uncertainty.

• Retail auto net charge-off rate was 1.75%, which, although improved, still reflects elevated delinquency levels.

• Deposit balances decreased by approximately $3 billion quarter-over-quarter, attributed to seasonal tax outflows, which could impact funding stability.

• The insurance business recorded a core pretax loss of $2 million due to higher losses, despite strong growth in premiums and investment revenue.

Q: What factors could lead to outperforming or underperforming the net interest margin (NIM) expectations for the second half of the year, and what is the timeline for achieving the 4% NIM target? A: Russell Hutchinson, CFO, explained that the second quarter NIM expansion was strong, but several factors that contributed to it are not expected to continue. These include securities repositioning and lease termination performance recovery. The company expects continued benefits from liquid deposit and CD repricing, albeit at a slower pace. The base case assumes three rate cuts in the second half of 2025, with additional cuts in early 2026. The 4% NIM target is now adjusted to the high 3s due to the credit card sale, and while no specific timeline is given, the company remains confident in achieving this target.