Parent and Guarantor Condensed Consolidating Financial Statements

Certain of our senior notes issued by the parent are guaranteed by 100% directly owned subsidiaries of Ally (the Guarantors). As of September 30, 2016, the Guarantors include Ally US LLC and IB Finance Holding Company, LLC (IB Finance), each of which fully and unconditionally guarantee the senior notes on a joint and several basis.

The following financial statements present condensed consolidating financial data for (i) Ally Financial Inc. (on a parent company-only basis); (ii) the Guarantors; (iii) the nonguarantor subsidiaries (all other subsidiaries); and (iv) an elimination column for adjustments to arrive at (v) the information for the parent company, the Guarantors, and nonguarantors on a consolidated basis.

Investments in subsidiaries are accounted for by the parent company and the Guarantors using the equity-method for this presentation. Results of operations of subsidiaries are therefore classified in the parent company’s and Guarantors’ investment in subsidiaries accounts. The elimination entries set forth in the following condensed consolidating financial statements eliminate distributed and undistributed income of subsidiaries, investments in subsidiaries, and intercompany balances and transactions between the parent, the Guarantors, and nonguarantors.

Condensed Consolidating Statements of Comprehensive Income



Three months ended September 30, 2016 ($ in millions)	Parent			Guarantors			Nonguarantors			Consolidating adjustments			Ally consolidated
Financing revenue and other interest income
Interest and fees on finance receivables and loans	$	(15	)	$	—		$	1,322		$	—		$	1,307
Interest and fees on finance receivables and loans — intercompany	2			—			2			(4		)	—
Interest and dividends on investment securities	—			—			102			(1		)	101
Interest on cash and cash equivalents	1			—			2			—			3
Interest-bearing cash — intercompany	—			—			2			(2		)	—
Operating leases	4			—			645			—			649
Total financing revenue and other interest income	(8		)	—			2,075			(7		)	2,060
Interest expense
Interest on deposits	2			—			210			—			212
Interest on short-term borrowings	10			—			4			—			14
Interest on long-term debt	289			—			141			—			430
Interest on intercompany debt	5			—			2			(7		)	—
Total interest expense	306			—			357			(7		)	656
Depreciation expense on operating lease assets	3			—			405			—			408
Net financing (loss) revenue	(317		)	—			1,313			—			996
Cash dividends from subsidiaries
Nonbank subsidiaries	170			—			—			(170		)	—
Other revenue
Insurance premiums and service revenue earned	—			—			238			—			238
(Loss) gain on mortgage and automotive loans, net	(7		)	—			7			—			—
Other gain on investments, net	—			—			52			—			52
Other income, net of losses	298			—			231			(431		)	98
Total other revenue	291			—			528			(431		)	388
Total net revenue	144			—			1,841			(601		)	1,384
Provision for loan losses	147			—			111			—			258
Noninterest expense
Compensation and benefits expense	143			—			105			—			248
Insurance losses and loss adjustment expenses	—			—			69			—			69
Other operating expenses	307			—			541			(430		)	418
Total noninterest expense	450			—			715			(430		)	735
(Loss) income from continuing operations before income tax (benefit) expense and undistributed income of subsidiaries	(453		)	—			1,015			(171		)	391
Income tax (benefit) expense from continuing operations	(88		)	—			218			—			130
Net (loss) income from continuing operations	(365		)	—			797			(171		)	261
Loss from discontinued operations, net of tax	(47		)	—			(5		)	—			(52		)
Undistributed income of subsidiaries
Bank subsidiary	325			325			—			(650		)	—
Nonbank subsidiaries	296			—			—			(296		)	—
Net income	209			325			792			(1,117		)	209
Other comprehensive loss, net of tax	(4		)	(3		)	(9		)	12			(4		)
Comprehensive income	$	205		$	322		$	783		$	(1,105	)	$	205



Three months ended September 30, 2015 ($ in millions)	Parent			Guarantors			Nonguarantors			Consolidating adjustments			Ally consolidated
Financing revenue and other interest income
Interest and fees on finance receivables and loans	$	(33	)	$	—		$	1,199		$	—		$	1,166
Interest and fees on finance receivables and loans — intercompany	3			—			1			(4		)	—
Interest on loans held-for-sale	—			—			2			—			2
Interest and dividends on investment securities	—			—			102			—			102
Interest on cash and cash equivalents	—			—			2			—			2
Interest-bearing cash — intercompany	—			—			2			(2		)	—
Operating leases	1			—			829			—			830
Total financing revenue and other interest income	(29		)	—			2,137			(6		)	2,102
Interest expense
Interest on deposits	3			—			178			—			181
Interest on short-term borrowings	10			—			3			—			13
Interest on long-term debt	272			—			138			—			410
Interest on intercompany debt	3			—			3			(6		)	—
Total interest expense	288			—			322			(6		)	604
Depreciation expense on operating lease assets	1			—			527			—			528
Net financing (loss) revenue	(318		)	—			1,288			—			970
Cash dividends from subsidiaries
Nonbank subsidiaries	494			—			—			(494		)	—
Other revenue
Insurance premiums and service revenue earned	—			—			236			—			236
Loss on mortgage and automotive loans, net	(1		)	—			(1		)	—			(2		)
Other gain on investments, net	—			—			6			—			6
Other income, net of losses	367			—			329			(604		)	92
Total other revenue	366			—			570			(604		)	332
Total net revenue	542			—			1,858			(1,098		)	1,302
Provision for loan losses	48			—			163			—			211
Noninterest expense
Compensation and benefits expense	138			—			212			(115		)	235
Insurance losses and loss adjustment expenses	—			—			61			—			61
Other operating expenses	315			—			552			(489		)	378
Total noninterest expense	453			—			825			(604		)	674
Income from continuing operations before income tax (benefit) expense and undistributed income (loss) of subsidiaries	41			—			870			(494		)	417
Income tax (benefit) expense from continuing operations	(30		)	—			174			—			144
Net income from continuing operations	71			—			696			(494		)	273
Loss from discontinued operations, net of tax	(5		)	—			—			—			(5		)
Undistributed income (loss) income of subsidiaries
Bank subsidiary	254			254			—			(508		)	—
Nonbank subsidiaries	(52		)	(1		)	—			53			—
Net income	268			253			696			(949		)	268
Other comprehensive income, net of tax	61			65			55			(120		)	61
Comprehensive income	$	329		$	318		$	751		$	(1,069	)	$	329



Nine months ended September 30, 2016 ($ in millions)	Parent			Guarantors			Nonguarantors			Consolidating adjustments			Ally consolidated
Financing revenue and other interest income
Interest and fees on finance receivables and loans	$	(82	)	$	—		$	3,889		$	—		$	3,807
Interest and fees on finance receivables and loans — intercompany	8			—			6			(14		)	—
Interest and dividends on investment securities	—			—			303			(1		)	302
Interest on cash and cash equivalents	4			—			6			—			10
Interest-bearing cash — intercompany	—			—			7			(7		)	—
Operating leases	14			—			2,105			—			2,119
Total financing revenue and other interest income	(56		)	—			6,316			(22		)	6,238
Interest expense
Interest on deposits	6			—			602			—			608
Interest on short-term borrowings	31			—			8			—			39
Interest on long-term debt	868			—			440			—			1,308
Interest on intercompany debt	14			—			8			(22		)	—
Total interest expense	919			—			1,058			(22		)	1,955
Depreciation expense on operating lease assets	11			—			1,341			—			1,352
Net financing (loss) revenue	(986		)	—			3,917			—			2,931
Cash dividends from subsidiaries
Nonbank subsidiaries	800			—			—			(800		)	—
Other revenue
Insurance premiums and service revenue earned	—			—			704			—			704
(Loss) gain on mortgage and automotive loans, net	(11		)	—			15			—			4
Loss on extinguishment of debt	(2		)	—			(2		)	—			(4		)
Other gain on investments, net	—			—			145			—			145
Other income, net of losses	989			—			661			(1,361		)	289
Total other revenue	976			—			1,523			(1,361		)	1,138
Total net revenue	790			—			5,440			(2,161		)	4,069
Provision for loan losses	295			—			355			—			650
Noninterest expense
Compensation and benefits expense	430			—			312			—			742
Insurance losses and loss adjustment expenses	—			—			287			—			287
Other operating expenses	963			—			1,586			(1,360		)	1,189
Total noninterest expense	1,393			—			2,185			(1,360		)	2,218
(Loss) income from continuing operations before income tax (benefit) expense and undistributed income (loss) of subsidiaries	(898		)	—			2,900			(801		)	1,201
Income tax (benefit) expense from continuing operations	(196		)	(82		)	614			—			336
Net (loss) income from continuing operations	(702		)	82			2,286			(801		)	865
Loss from discontinued operations, net of tax	(39		)	—			(7		)	—			(46		)
Undistributed income (loss) of subsidiaries
Bank subsidiary	932			932			—			(1,864		)	—
Nonbank subsidiaries	628			(2		)	—			(626		)	—
Net income	819			1,012			2,279			(3,291		)	819
Other comprehensive income, net of tax	262			143			234			(377		)	262
Comprehensive income	$	1,081		$	1,155		$	2,513		$	(3,668	)	$	1,081



Nine months ended September 30, 2015 ($ in millions)	Parent			Guarantors			Nonguarantors			Consolidating adjustments			Ally consolidated
Financing revenue and other interest income
Interest and fees on finance receivables and loans	$	(45	)	$	—		$	3,403		$	—		$	3,358
Interest and fees on finance receivables and loans — intercompany	15			—			22			(37		)	—
Interest on loans held-for-sale	—			—			40			—			40
Interest and dividends on investment securities	—			—			283			—			283
Interest on cash and cash equivalents	1			—			5			—			6
Interest-bearing cash — intercompany	—			—			6			(6		)	—
Operating leases	1			—			2,585			—			2,586
Total financing revenue and other interest income	(28		)	—			6,344			(43		)	6,273
Interest expense
Interest on deposits	8			—			522			—			530
Interest on short-term borrowings	30			—			6			—			36
Interest on long-term debt	856			—			402			—			1,258
Interest on intercompany debt	28			—			15			(43		)	—
Total interest expense	922			—			945			(43		)	1,824
Depreciation expense on operating lease assets	1			—			1,712			—			1,713
Net financing (loss) revenue	(951		)	—			3,687			—			2,736
Cash dividends from subsidiaries
Bank subsidiaries	525			525			—			(1,050		)	—
Nonbank subsidiaries	980			—			—			(980		)	—
Other revenue
Insurance premiums and service revenue earned	—			—			706			—			706
(Loss) gain on mortgage and automotive loans, net	(9		)	—			54			—			45
Loss on extinguishment of debt	(353		)	—			(1		)	—			(354		)
Other gain on investments, net	—			—			106			—			106
Other income, net of losses	1,045			—			1,019			(1,781		)	283
Total other revenue	683			—			1,884			(1,781		)	786
Total net revenue	1,237			525			5,571			(3,811		)	3,522
Provision for loan losses	111			—			356			—			467
Noninterest expense
Compensation and benefits expense	431			—			634			(339		)	726
Insurance losses and loss adjustment expenses	—			—			239			—			239
Other operating expenses	935			—			1,635			(1,442		)	1,128
Total noninterest expense	1,366			—			2,508			(1,781		)	2,093
(Loss) income from continuing operations before income tax (benefit) expense and undistributed income (loss) of subsidiaries	(240		)	525			2,707			(2,030		)	962
Income tax (benefit) expense from continuing operations	(231		)	—			572			—			341
Net (loss) income from continuing operations	(9		)	525			2,135			(2,030		)	621
Income from discontinued operations, net of tax	367			—			38			—			405
Undistributed income (loss) of subsidiaries
Bank subsidiary	302			302			—			(604		)	—
Nonbank subsidiaries	366			(1		)	—			(365		)	—
Net income	1,026			826			2,173			(2,999		)	1,026
Other comprehensive (loss) income, net of tax	(56		)	40			(64		)	24			(56		)
Comprehensive income	$	970		$	866		$	2,109		$	(2,975	)	$	970

Condensed Consolidating Balance Sheet



September 30, 2016 ($ in millions)	Parent (a)			Guarantors		Nonguarantors (a)			Consolidating adjustments			Ally consolidated
Assets
Cash and cash equivalents
Noninterest-bearing	$	809		$	—	$	970		$	—		$	1,779
Interest-bearing	600			—		1,910			—			2,510
Interest-bearing — intercompany	—			—		779			(779		)	—
Total cash and cash equivalents	1,409			—		3,659			(779		)	4,289
Available-for-sale securities	—			—		18,030			(329		)	17,701
Held-to-maturity securities	—			—		649			—			649
Loans held-for-sale, net	—			—		56			—			56
Finance receivables and loans, net
Finance receivables and loans, net	5,501			—		109,458			—			114,959
Intercompany loans to
Bank subsidiary	300			—		—			(300		)	—
Nonbank subsidiaries	1,693			—		600			(2,293		)	—
Allowance for loan losses	(125		)	—		(1,009		)	—			(1,134		)
Total finance receivables and loans, net	7,369			—		109,049			(2,593		)	113,825
Investment in operating leases, net	50			—		12,639			—			12,689
Intercompany receivables from
Bank subsidiary	343			—		—			(343		)	—
Nonbank subsidiaries	90			—		127			(217		)	—
Investment in subsidiaries
Bank subsidiary	17,582			17,582		—			(35,164		)	—
Nonbank subsidiaries	11,378			1		—			(11,379		)	—
Premiums receivable and other insurance assets	—			—		1,906			(25		)	1,881
Other assets	4,434			—		4,681			(2,808		)	6,307
Total assets	$	42,655		$	17,583	$	150,796		$	(53,637	)	$	157,397
Liabilities
Deposit liabilities
Noninterest-bearing	$	—		$	—	$	101		$	—		$	101
Interest-bearing	193			—		75,450			—			75,643
Total deposit liabilities	193			—		75,551			—			75,744
Short-term borrowings	3,525			—		2,909			—			6,434
Long-term debt	22,264			—		34,572			—			56,836
Intercompany debt to
Bank subsidiary	330			—		—			(330		)	—
Nonbank subsidiaries	1,379			—		1,993			(3,372		)	—
Intercompany payables to
Bank subsidiary	436			—		—			(436		)	—
Nonbank subsidiaries	179			—		(29		)	(150		)	—
Interest payable	247			—		215			—			462
Unearned insurance premiums and service revenue	—			—		2,493			—			2,493
Accrued expenses and other liabilities	472			—		4,133			(2,807		)	1,798
Total liabilities	29,025			—		121,837			(7,095		)	143,767
Total equity	13,630			17,583		28,959			(46,542		)	13,630
Total liabilities and equity	$	42,655		$	17,583	$	150,796		$	(53,637	)	$	157,397


(a)	Amounts presented are based upon the legal transfer of the underlying assets to VIEs in order to reflect legal ownership.



December 31, 2015 ($ in millions)	Parent (a)			Guarantors		Nonguarantors (a)			Consolidating adjustments			Ally consolidated
Assets
Cash and cash equivalents
Noninterest-bearing	$	1,234		$	—	$	914		$	—		$	2,148
Interest-bearing	401			—		3,831			—			4,232
Interest-bearing — intercompany	—			—		850			(850		)	—
Total cash and cash equivalents	1,635			—		5,595			(850		)	6,380
Available-for-sale securities	—			—		17,157			—			17,157
Loans held-for-sale, net	—			—		105			—			105
Finance receivables and loans, net
Finance receivables and loans, net	2,636			—		108,964			—			111,600
Intercompany loans to
Bank subsidiary	600			—		—			(600		)	—
Nonbank subsidiaries	3,277			—		559			(3,836		)	—
Allowance for loan losses	(72		)	—		(982		)	—			(1,054		)
Total finance receivables and loans, net	6,441			—		108,541			(4,436		)	110,546
Investment in operating leases, net	81			—		16,190			—			16,271
Intercompany receivables from
Bank subsidiary	186			—		—			(186		)	—
Nonbank subsidiaries	259			—		282			(541		)	—
Investment in subsidiaries
Bank subsidiary	16,496			16,496		—			(32,992		)	—
Nonbank subsidiaries	10,902			11		—			(10,913		)	—
Premiums receivable and other insurance assets	—			—		1,827			(26		)	1,801
Other assets	4,785			—		4,488			(2,952		)	6,321
Total assets	$	40,785		$	16,507	$	154,185		$	(52,896	)	$	158,581
Liabilities
Deposit liabilities
Noninterest-bearing	$	—		$	—	$	89		$	—		$	89
Interest-bearing	229			—		66,160			—			66,389
Total deposit liabilities	229			—		66,249			—			66,478
Short-term borrowings	3,453			—		4,648			—			8,101
Long-term debt	21,048			—		45,186			—			66,234
Intercompany debt to
Nonbank subsidiaries	1,409			—		3,877			(5,286		)	—
Intercompany payables to
Bank subsidiary	142			—		—			(142		)	—
Nonbank subsidiaries	420			—		191			(611		)	—
Interest payable	258			—		92			—			350
Unearned insurance premiums and service revenue	—			—		2,434			—			2,434
Accrued expenses and other liabilities	387			82		4,028			(2,952		)	1,545
Total liabilities	27,346			82		126,705			(8,991		)	145,142
Total equity	13,439			16,425		27,480			(43,905		)	13,439
Total liabilities and equity	$	40,785		$	16,507	$	154,185		$	(52,896	)	$	158,581


(a)	Amounts presented are based upon the legal transfer of the underlying assets to VIEs in order to reflect legal ownership.

Condensed Consolidating Statement of Cash Flows



Nine months ended September 30, 2016 ($ in millions)	Parent			Guarantors			Nonguarantors			Consolidating adjustments			Ally consolidated
Operating activities
Net cash provided by operating activities	$	709		$	—		$	3,782		$	(902	)	$	3,589
Investing activities
Purchases of available-for-sale securities	—			—			(11,027		)	—			(11,027		)
Proceeds from sales of available-for-sale securities	—			—			8,546			—			8,546
Proceeds from maturities and repayments of available-for-sale securities	—			—			2,411			—			2,411
Purchases of held-to-maturity securities	—			—			(650		)	—			(650		)
Net decrease (increase) in finance receivables and loans	934			—			(9,242		)	—			(8,308		)
Proceeds from sales of finance receivables and loans originated as held-for-investment	—			—			4,221			—			4,221
Net change in loans — intercompany	1,788			—			(41		)	(1,747		)	—
Purchases of operating lease assets	—			—			(2,360		)	—			(2,360		)
Disposals of operating lease assets	16			—			4,615			—			4,631
Acquisitions, net of cash acquired	(309		)	—			—			—			(309		)
Capital contributions to subsidiaries	(3,112		)	—			—			3,112			—
Returns of contributed capital	2,168			8			—			(2,176		)	—
Net change in restricted cash	(136		)	—			758			—			622
Net change in nonmarketable equity investments	—			—			(401		)	—			(401		)
Other, net	(156		)	—			(103		)	102			(157		)
Net cash provided by (used in) investing activities	1,193			8			(3,273		)	(709		)	(2,781		)
Financing activities
Net change in short-term borrowings — third party	72			—			(1,745		)	—			(1,673		)
Net (decrease) increase in deposits	(36		)	—			9,276			—			9,240
Proceeds from issuance of long-term debt — third party	1,084			—			10,145			—			11,229
Repayments of long-term debt — third party	(2,279		)	—			(18,479		)	—			(20,758		)
Net change in debt — intercompany	(30		)	—			(1,788		)	1,818			—
Redemption of preferred stock	(696		)	—			—			—			(696		)
Repurchase of common stock	(173		)	—			—			—			(173		)
Dividends paid — third party	(70		)	—			—			—			(70		)
Dividends paid and returns of contributed capital — intercompany	—			(8		)	(2,968		)	2,976			—
Capital contributions from parent	—			—			3,112			(3,112		)	—
Net cash used in financing activities	(2,128		)	(8		)	(2,447		)	1,682			(2,901		)
Effect of exchange-rate changes on cash and cash equivalents	—			—			2			—			2
Net decrease in cash and cash equivalents	(226		)	—			(1,936		)	71			(2,091		)
Cash and cash equivalents at beginning of year	1,635			—			5,595			(850		)	6,380
Cash and cash equivalents at September 30,	$	1,409		$	—		$	3,659		$	(779	)	$	4,289



Nine months ended September 30, 2015 ($ in millions)	Parent			Guarantors			Nonguarantors			Consolidating adjustments			Ally consolidated
Operating activities
Net cash provided by operating activities	$	67		$	525		$	5,408		$	(2,030	)	$	3,970
Investing activities
Purchases of available-for-sale securities	—			—			(10,011		)	—			(10,011		)
Proceeds from sales of available-for-sale securities	—			—			4,408			—			4,408
Proceeds from maturities and repayments of available-for -sale securities	—			—			3,141			—			3,141
Net decrease (increase) in finance receivables and loans	398			—			(9,573		)	—			(9,175		)
Proceeds from sales of finance receivables and loans originated as held-for-investment	—			—			2,665			—			2,665
Net change in loans — intercompany	2,392			—			1,225			(3,617		)	—
Purchases of operating lease assets	(94		)	—			(3,329		)	—			(3,423		)
Disposals of operating lease assets	—			—			3,855			—			3,855
Capital contributions to subsidiaries	(228		)	(1		)	1			228			—
Returns of contributed capital	881			—			—			(881		)	—
Proceeds from sale of business unit, net	1,049			—			—			—			1,049
Net change in restricted cash	(12		)	—			501			—			489
Net change in nonmarketable equity investments	—			—			(42		)	—			(42		)
Other, net	(29		)	—			54			—			25
Net cash provided by (used in) investing activities	4,357			(1		)	(7,105		)	(4,270		)	(7,019		)
Financing activities
Net change in short-term borrowings — third party	120			—			(1,812		)	—			(1,692		)
Net (decrease) increase in deposits	(72		)	—			5,869			—			5,797
Proceeds from issuance of long-term debt — third party	4,037			—			19,829			—			23,866
Repayments of long-term debt — third party	(5,866		)	—			(17,588		)	—			(23,454		)
Net change in debt — intercompany	(1,117		)	—			(2,393		)	3,510			—
Repurchase and redemption of preferred stock	(442		)	—			—			—			(442		)
Repurchase of common stock	(16		)	—			—			—			(16		)
Dividends paid — third party	(1,356		)	—			—			—			(1,356		)
Dividends paid and returns of contributed capital — intercompany	—			(525		)	(2,386		)	2,911			—
Capital contributions from parent	—			1			227			(228		)	—
Net cash (used in) provided by financing activities	(4,712		)	(524		)	1,746			6,193			2,703
Effect of exchange-rate changes on cash and cash equivalents	—			—			(3		)	—			(3		)
Net (decrease) increase in cash and cash equivalents	(288		)	—			46			(107		)	(349		)
Cash and cash equivalents at beginning of year	2,286			—			3,905			(615		)	5,576
Cash and cash equivalents at September 30,	$	1,998		$	—		$	3,951		$	(722	)	$	5,227