þ | QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 |
¨ | TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 |
Delaware | 38-0572512 | |
(State or other jurisdiction of incorporation or organization) | (I.R.S. Employer Identification No.) |
Large accelerated filer þ | Accelerated filer o | Non-accelerated filer o | Smaller reporting company o | |||
(Do not check if a smaller reporting company) | Emerging growth company o | |||||
If an emerging growth company, indicate by check mark if the registrant has elected not to use the extended transition period for complying with any new or revised financial accounting standards provided pursuant to Section 13(a) of the Exchange Act. o |
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PART I — FINANCIAL INFORMATION |
Three months ended June 30, | Six months ended June 30, | |||||||||||||||
($ in millions) | 2018 | 2017 | 2018 | 2017 | ||||||||||||
Financing revenue and other interest income | ||||||||||||||||
Interest and fees on finance receivables and loans | $ | 1,647 | $ | 1,447 | $ | 3,190 | $ | 2,815 | ||||||||
Interest on loans held-for-sale | 6 | — | 6 | — | ||||||||||||
Interest and dividends on investment securities and other earning assets | 188 | 146 | 364 | 280 | ||||||||||||
Interest on cash and cash equivalents | 17 | 7 | 32 | 12 | ||||||||||||
Operating leases | 374 | 488 | 756 | 1,031 | ||||||||||||
Total financing revenue and other interest income | 2,232 | 2,088 | 4,348 | 4,138 | ||||||||||||
Interest expense | ||||||||||||||||
Interest on deposits | 399 | 250 | 750 | 481 | ||||||||||||
Interest on short-term borrowings | 40 | 33 | 72 | 60 | ||||||||||||
Interest on long-term debt | 434 | 417 | 845 | 841 | ||||||||||||
Total interest expense | 873 | 700 | 1,667 | 1,382 | ||||||||||||
Net depreciation expense on operating lease assets | 265 | 321 | 538 | 710 | ||||||||||||
Net financing revenue and other interest income | 1,094 | 1,067 | 2,143 | 2,046 | ||||||||||||
Other revenue | ||||||||||||||||
Insurance premiums and service revenue earned | 239 | 227 | 495 | 468 | ||||||||||||
Gain on mortgage and automotive loans, net | 1 | 36 | 2 | 50 | ||||||||||||
Other gain on investments, net | 27 | 23 | 15 | 50 | ||||||||||||
Other income, net of losses | 97 | 102 | 206 | 216 | ||||||||||||
Total other revenue | 364 | 388 | 718 | 784 | ||||||||||||
Total net revenue | 1,458 | 1,455 | 2,861 | 2,830 | ||||||||||||
Provision for loan losses | 158 | 269 | 419 | 540 | ||||||||||||
Noninterest expense | ||||||||||||||||
Compensation and benefits expense | 292 | 265 | 598 | 550 | ||||||||||||
Insurance losses and loss adjustment expenses | 101 | 125 | 164 | 213 | ||||||||||||
Other operating expenses | 446 | 420 | 891 | 825 | ||||||||||||
Total noninterest expense | 839 | 810 | 1,653 | 1,588 | ||||||||||||
Income from continuing operations before income tax expense | 461 | 376 | 789 | 702 | ||||||||||||
Income tax expense from continuing operations | 113 | 122 | 189 | 235 | ||||||||||||
Net income from continuing operations | 348 | 254 | 600 | 467 | ||||||||||||
Income (loss) from discontinued operations, net of tax | 1 | (2 | ) | (1 | ) | (1 | ) | |||||||||
Net income | 349 | 252 | 599 | 466 | ||||||||||||
Other comprehensive (loss) income, net of tax | (70 | ) | 76 | (398 | ) | 96 | ||||||||||
Comprehensive income | $ | 279 | $ | 328 | $ | 201 | $ | 562 |
Three months ended June 30, | Six months ended June 30, | |||||||||||||||
(in dollars) (a) | 2018 | 2017 | 2018 | 2017 | ||||||||||||
Basic earnings per common share | ||||||||||||||||
Net income from continuing operations | $ | 0.81 | $ | 0.55 | $ | 1.38 | $ | 1.01 | ||||||||
Loss from discontinued operations, net of tax | — | (0.01 | ) | — | — | |||||||||||
Net income | $ | 0.81 | $ | 0.55 | $ | 1.38 | $ | 1.01 | ||||||||
Diluted earnings per common share | ||||||||||||||||
Net income from continuing operations | $ | 0.80 | $ | 0.55 | $ | 1.38 | $ | 1.01 | ||||||||
Loss from discontinued operations, net of tax | — | (0.01 | ) | — | — | |||||||||||
Net income | $ | 0.81 | $ | 0.55 | $ | 1.37 | $ | 1.01 | ||||||||
Cash dividends declared per common share | $ | 0.13 | $ | 0.08 | $ | 0.26 | $ | 0.16 |
(a) | Figures in the table may not recalculate exactly due to rounding. Earnings per share is calculated based on unrounded numbers. |
($ in millions, except share data) | June 30, 2018 | December 31, 2017 | ||||||
Assets | ||||||||
Cash and cash equivalents | ||||||||
Noninterest-bearing | $ | 799 | $ | 844 | ||||
Interest-bearing | 3,125 | 3,408 | ||||||
Total cash and cash equivalents | 3,924 | 4,252 | ||||||
Equity securities | 521 | 518 | ||||||
Available-for-sale securities (refer to Note 6 for discussion of investment securities pledged as collateral) | 23,296 | 22,303 | ||||||
Held-to-maturity securities (fair value of $2,007 and $1,865) | 2,089 | 1,899 | ||||||
Loans held-for-sale, net | 328 | 108 | ||||||
Finance receivables and loans, net | ||||||||
Finance receivables and loans, net of unearned income | 125,544 | 122,893 | ||||||
Allowance for loan losses | (1,257 | ) | (1,276 | ) | ||||
Total finance receivables and loans, net | 124,287 | 121,617 | ||||||
Investment in operating leases, net | 8,639 | 8,741 | ||||||
Premiums receivable and other insurance assets | 2,247 | 2,047 | ||||||
Other assets | 6,014 | 5,663 | ||||||
Total assets | $ | 171,345 | $ | 167,148 | ||||
Liabilities | ||||||||
Deposit liabilities | ||||||||
Noninterest-bearing | $ | 153 | $ | 108 | ||||
Interest-bearing | 98,581 | 93,148 | ||||||
Total deposit liabilities | 98,734 | 93,256 | ||||||
Short-term borrowings | 7,108 | 11,413 | ||||||
Long-term debt | 47,328 | 44,226 | ||||||
Interest payable | 568 | 375 | ||||||
Unearned insurance premiums and service revenue | 2,957 | 2,604 | ||||||
Accrued expenses and other liabilities | 1,511 | 1,780 | ||||||
Total liabilities | 158,206 | 153,654 | ||||||
Contingencies (refer to Note 24) | ||||||||
Equity | ||||||||
Common stock and paid-in capital ($0.01 par value, shares authorized 1,100,000,000; issued 492,334,686 and 489,883,553; and outstanding 425,752,181 and 437,053,936) | 21,303 | 21,245 | ||||||
Accumulated deficit | (6,026 | ) | (6,406 | ) | ||||
Accumulated other comprehensive loss | (648 | ) | (235 | ) | ||||
Treasury stock, at cost (66,582,505 and 52,829,617 shares) | (1,490 | ) | (1,110 | ) | ||||
Total equity | 13,139 | 13,494 | ||||||
Total liabilities and equity | $ | 171,345 | $ | 167,148 |
($ in millions) | June 30, 2018 | December 31, 2017 | ||||||
Assets | ||||||||
Finance receivables and loans, net | ||||||||
Finance receivables and loans, net of unearned income | $ | 19,386 | $ | 20,623 | ||||
Allowance for loan losses | (146 | ) | (136 | ) | ||||
Total finance receivables and loans, net | 19,240 | 20,487 | ||||||
Investment in operating leases, net | 257 | 444 | ||||||
Other assets | 722 | 689 | ||||||
Total assets | $ | 20,219 | $ | 21,620 | ||||
Liabilities | ||||||||
Long-term debt | $ | 12,345 | $ | 10,197 | ||||
Accrued expenses and other liabilities | 12 | 9 | ||||||
Total liabilities | $ | 12,357 | $ | 10,206 |
($ in millions) | Common stock and paid-in capital | Accumulated deficit | Accumulated other comprehensive loss | Treasury stock | Total equity | |||||||||||||||
Balance at January 1, 2017 | $ | 21,166 | $ | (7,151 | ) | $ | (341 | ) | $ | (357 | ) | $ | 13,317 | |||||||
Net income | 466 | 466 | ||||||||||||||||||
Share-based compensation | 42 | 42 | ||||||||||||||||||
Other comprehensive income | 96 | 96 | ||||||||||||||||||
Common stock repurchases | (373 | ) | (373 | ) | ||||||||||||||||
Common stock dividends ($0.16 per share) | (75 | ) | (75 | ) | ||||||||||||||||
Balance at June 30, 2017 | $ | 21,208 | $ | (6,760 | ) | $ | (245 | ) | $ | (730 | ) | $ | 13,473 | |||||||
Balance at January 1, 2018, before cumulative effect of adjustments | $ | 21,245 | $ | (6,406 | ) | $ | (235 | ) | $ | (1,110 | ) | $ | 13,494 | |||||||
Cumulative effect of changes in accounting principles, net of tax (a) | ||||||||||||||||||||
Adoption of Accounting Standards Update 2014-09 | (126 | ) | (126 | ) | ||||||||||||||||
Adoption of Accounting Standards Update 2016-01 | (20 | ) | 27 | 7 | ||||||||||||||||
Adoption of Accounting Standards Update 2018-02 | 42 | (42 | ) | — | ||||||||||||||||
Balance at January 1, 2018, after cumulative effect of adjustments | 21,245 | (6,510 | ) | (250 | ) | (1,110 | ) | 13,375 | ||||||||||||
Net income | 599 | 599 | ||||||||||||||||||
Share-based compensation | 58 | 58 | ||||||||||||||||||
Other comprehensive loss | (398 | ) | (398 | ) | ||||||||||||||||
Common stock repurchases | (380 | ) | (380 | ) | ||||||||||||||||
Common stock dividends ($0.26 per share) | (115 | ) | (115 | ) | ||||||||||||||||
Balance at June 30, 2018 | $ | 21,303 | $ | (6,026 | ) | $ | (648 | ) | $ | (1,490 | ) | $ | 13,139 |
(a) | Refer to the section titled Recently Adopted Accounting Standards in Note 1 for additional information. |
Six months ended June 30, ($ in millions) | 2018 | 2017 | ||||||
Operating activities | ||||||||
Net income | $ | 599 | $ | 466 | ||||
Reconciliation of net income to net cash provided by operating activities | ||||||||
Depreciation and amortization | 865 | 1,003 | ||||||
Provision for loan losses | 419 | 540 | ||||||
Gain on mortgage and automotive loans, net | (2 | ) | (50 | ) | ||||
Other gain on investments, net | (15 | ) | (50 | ) | ||||
Originations and purchases of loans held-for-sale | (730 | ) | (202 | ) | ||||
Proceeds from sales and repayments of loans held-for-sale | 512 | 187 | ||||||
Net change in | ||||||||
Deferred income taxes | 192 | 203 | ||||||
Interest payable | 193 | 48 | ||||||
Other assets | (25 | ) | (94 | ) | ||||
Other liabilities | (24 | ) | (50 | ) | ||||
Other, net | 25 | 69 | ||||||
Net cash provided by operating activities | 2,009 | 2,070 | ||||||
Investing activities | ||||||||
Purchases of equity securities | (500 | ) | (363 | ) | ||||
Proceeds from sales of equity securities | 535 | 484 | ||||||
Purchases of available-for-sale securities | (4,094 | ) | (5,490 | ) | ||||
Proceeds from sales of available-for-sale securities | 390 | 1,678 | ||||||
Proceeds from repayments of available-for-sale securities | 1,621 | 1,230 | ||||||
Purchases of held-to-maturity securities | (316 | ) | (313 | ) | ||||
Proceeds from repayments of held-to-maturity securities | 72 | 17 | ||||||
Purchases of finance receivables and loans held-for-investment | (2,611 | ) | (1,817 | ) | ||||
Proceeds from sales of finance receivables and loans initially held-for-investment | — | 1,280 | ||||||
Originations and repayments of finance receivables and loans held-for-investment and other, net | (638 | ) | (1,588 | ) | ||||
Purchases of operating lease assets | (2,107 | ) | (1,965 | ) | ||||
Disposals of operating lease assets | 1,763 | 3,043 | ||||||
Net change in nonmarketable equity investments | (46 | ) | 107 | |||||
Other, net | (186 | ) | (90 | ) | ||||
Net cash used in investing activities | (6,117 | ) | (3,787 | ) |
Six months ended June 30, ($ in millions) | 2018 | 2017 | ||||||
Financing activities | ||||||||
Net change in short-term borrowings | (4,305 | ) | (1,962 | ) | ||||
Net increase in deposits | 5,441 | 7,133 | ||||||
Proceeds from issuance of long-term debt | 12,940 | 9,330 | ||||||
Repayments of long-term debt | (9,800 | ) | (14,366 | ) | ||||
Repurchase of common stock | (380 | ) | (373 | ) | ||||
Dividends paid | (115 | ) | (75 | ) | ||||
Net cash provided by (used in) financing activities | 3,781 | (313 | ) | |||||
Effect of exchange-rate changes on cash and cash equivalents and restricted cash | (3 | ) | 2 | |||||
Net decrease in cash and cash equivalents and restricted cash | (330 | ) | (2,028 | ) | ||||
Cash and cash equivalents and restricted cash at beginning of year | 5,269 | 7,881 | ||||||
Cash and cash equivalents and restricted cash at June 30, | $ | 4,939 | $ | 5,853 | ||||
Supplemental disclosures | ||||||||
Cash paid for | ||||||||
Interest | $ | 1,455 | $ | 1,331 | ||||
Income taxes | 17 | 28 | ||||||
Noncash items | ||||||||
Held-to-maturity securities received in consideration for loans sold | — | 56 | ||||||
Finance receivables and loans transferred to loans held-for-sale | — | 1,298 | ||||||
Other disclosures | ||||||||
Proceeds from repayments of mortgage loans held-for-investment originally designated as held-for-sale | 12 | 20 |
June 30, ($ in millions) | 2018 | 2017 | ||||||
Cash and cash equivalents as disclosed on the Condensed Consolidated Balance Sheet | $ | 3,924 | $ | 4,377 | ||||
Restricted cash included in other assets on the Condensed Consolidated Balance Sheet (a) | 1,015 | 1,476 | ||||||
Total cash and cash equivalents and restricted cash as disclosed in the Condensed Consolidated Statement of Cash Flows | $ | 4,939 | $ | 5,853 |
(a) | Restricted cash balances relate primarily to Ally securitization arrangements. Refer to Note 11 for additional details describing the nature of restricted cash balances. |
($ in millions) | As reported, December 31, 2017 | Adjustment related to adoption | As adjusted, January 1, 2018 | |||||||||
Assets | ||||||||||||
Premiums receivable and other insurance assets | $ | 2,047 | $ | 122 | $ | 2,169 | ||||||
Other assets | 5,663 | 41 | 5,704 | |||||||||
Total assets | $ | 167,148 | $ | 163 | $ | 167,311 | ||||||
Liabilities | ||||||||||||
Unearned insurance premiums and service revenue | $ | 2,604 | $ | 289 | $ | 2,893 | ||||||
Total liabilities | 153,654 | 289 | 153,943 | |||||||||
Equity | ||||||||||||
Accumulated deficit | (6,406 | ) | (126 | ) | (6,532 | ) | ||||||
Total equity | 13,494 | (126 | ) | 13,368 | ||||||||
Total liabilities and equity | $ | 167,148 | $ | 163 | $ | 167,311 |
Three months ended June 30, 2018 | Six months ended June 30, 2018 | |||||||||||||||
($ in millions) | As reported | Effect of adoption | As reported | Effect of adoption | ||||||||||||
Other revenue | ||||||||||||||||
Insurance premiums and service revenue earned | $ | 239 | $ | (9 | ) | $ | 495 | $ | (15 | ) | ||||||
Total other revenue | 364 | (9 | ) | 718 | (15 | ) | ||||||||||
Total net revenue | 1,458 | (9 | ) | 2,861 | (15 | ) | ||||||||||
Noninterest expense | ||||||||||||||||
Compensation and benefits expense | 292 | (1 | ) | 598 | (2 | ) | ||||||||||
Other operating expenses | 446 | (3 | ) | 891 | (5 | ) | ||||||||||
Total noninterest expense | 839 | (4 | ) | 1,653 | (7 | ) | ||||||||||
Income from continuing operations before income tax expense | 461 | (5 | ) | 789 | (8 | ) | ||||||||||
Income tax expense from continuing operations | 113 | (1 | ) | 189 | (2 | ) | ||||||||||
Net income from continuing operations | 348 | (4 | ) | 600 | (6 | ) | ||||||||||
Net income | 349 | (4 | ) | 599 | (6 | ) | ||||||||||
Comprehensive income | $ | 279 | $ | (4 | ) | $ | 201 | $ | (6 | ) |
June 30, 2018 ($ in millions) | As reported | Effect of adoption | ||||||
Assets | ||||||||
Premiums receivable and other insurance assets | $ | 2,247 | $ | 128 | ||||
Other assets | 6,014 | 43 | ||||||
Total assets | 171,345 | 171 | ||||||
Liabilities | ||||||||
Unearned insurance premiums and service revenue | $ | 2,957 | $ | 304 | ||||
Total liabilities | 158,206 | 304 | ||||||
Equity | ||||||||
Accumulated deficit | (6,026 | ) | (133 | ) | ||||
Total equity | 13,139 | (133 | ) | |||||
Total liabilities and equity | $ | 171,345 | $ | 171 |
• | Noninsurance contracts — We sell VSCs that offer owners mechanical repair protection and roadside assistance for new and used vehicles beyond the manufacturer’s new vehicle limited warranty. We sell GAP contracts that protect the customer against having to pay certain amounts to a lender above the fair market value of their vehicle if the vehicle is damaged and declared a total loss or stolen. We also sell VMCs that provide coverage for certain agreed-upon services, such as oil changes and tire rotations, over the coverage period. We receive payment in full at the inception of each of these contracts. Our performance obligation for these contracts is satisfied over the term of the contract and we recognize revenue over the contract term on a basis proportionate to the anticipated cost emergence, as we believe this is the most appropriate method to measure progress towards satisfaction of the performance obligation. Upon adoption of the amendments to the revenue recognition principles, unearned revenue of $289 million was recognized as a component of unearned insurance premiums and service revenue on our Condensed Consolidated Balance Sheet associated with outstanding contracts at January 1, 2018, and $22 million and $44 million of this balance were recognized as insurance premiums and service revenue earned in our Condensed Consolidated Statement of Comprehensive Income during the three months and six months ended June 30, 2018, respectively. At June 30, 2018, we had unearned revenue of $2.6 billion associated with outstanding contracts, and with respect to this balance we expect to recognize revenue of $407 million during the remainder of 2018, $663 million in 2019, $564 million in 2020, $423 million in 2021, and $501 million thereafter. The incremental costs to obtain these contracts are initially deferred and recorded as a component of premiums receivable and other insurance assets on our Condensed Consolidated Balance Sheet. These deferred costs are amortized as an expense over the term of the related contract commensurate with how the related revenue is recognized, and are included in compensation and benefits and other operating expenses in our Condensed Consolidated Statement of Comprehensive Income. We had deferred insurance assets of $1.5 billion at June 30, 2018, and recognized $106 million and $209 million of expense during the three months and six months ended June 30, 2018, respectively. |
• | Sale of off-lease vehicles — When a customer’s vehicle lease matures, the customer has the option of purchasing or returning the vehicle. If the vehicle is returned to us, we obtain possession with the intent to sell through SmartAuction—our online auction platform, our dealer channel, or through various other physical auctions. Our performance obligation is satisfied and the remarketing gain or loss is recognized when control of the vehicle has passed to the buyer, which coincides with the sale date. Our actual sales proceeds from remarketing the vehicle may be higher or lower than the estimated residual value resulting in a gain or loss on remarketing recorded through depreciation expense on operating lease assets in our Condensed Consolidated Statement of Comprehensive Income. |
• | Remarketing fee income — In addition to using SmartAuction as a remarketing channel for our returned lease vehicles, we maintain the internet auction site and administer the auction process for third-party use. We earn a service fee from dealers for every third-party vehicle sold through SmartAuction. Our performance obligation is to provide the online marketplace for used vehicle transactions to be consummated. This obligation is satisfied and revenue is recognized when control of the vehicle has passed to the buyer, which coincides with the sale date. This revenue is recorded as remarketing fees within other income in our Condensed Consolidated Statement of Comprehensive Income. |
• | Brokerage commissions and other revenues through Ally Invest — We charge fees to customers related to their use of certain services on our Ally Invest digital wealth management and online brokerage platform. These fees include commissions on |
• | Brokered/agent commissions through Insurance operations — We have agreements with third parties to offer various vehicle protection products to consumers. We also have agreements with third-party insurers to offer various insurance coverages to dealers. Our performance obligation for these arrangements is satisfied when a customer or dealer has purchased a vehicle protection product or an insurance policy through the third-party provider. In determining the initial transaction price for these agreements, we noted that revenue on brokered/agent commissions is based on the volume of vehicle protection product contracts sold or a percentage of insurance premium written, which is not known to Ally at the inception of the agreements with these third-party providers. As such, we believe the initial transaction price is exclusively variable consideration and, based on the nature of the performance obligation, we are unable to determine the amount of revenue we will record until the customer purchases a vehicle protection product or a dealer purchases an insurance policy from the third-party provider. Once Ally is notified of vehicle protection product sales or insurance policies issued by the third-party providers, we record the commission earned as insurance premiums and service revenues earned in our Condensed Consolidated Statement of Comprehensive Income. |
• | Deposit account and other banking fees — We charge depositors various account service fees including those for outgoing wires, excessive transactions, overdrafts, stop payments, and returned deposits. These fees are generated from a customer option to purchase services offered under the contract. These options do not represent a material right and are only considered a contract in accordance with the amendments to the revenue recognition principles when the customer exercises their option to purchase these account services. Based on this, the term for our contracts with customers is considered day-to-day, and the contract does not extend beyond the services already provided. Revenue derived from deposit account fees is recorded at the point in time we perform the requested service, and is recorded as other income in our Condensed Consolidated Statement of Comprehensive Income. As a debit card issuer, we also generate interchange fee income from merchants during debit card transactions and incur certain corresponding charges from merchant card networks. Our performance obligation is satisfied when we have initiated the payment of funds from a customer’s account to a merchant through our contractual agreements with the merchant card networks. Interchange fees are reported on a net basis as other income in our Condensed Consolidated Statement of Comprehensive Income. Gross interchange fee income was $3 million and $6 million, and interchange expense was $2 million and $5 million, for the three months and six months ended June 30, 2018, respectively. |
• | Other revenue — Other revenue primarily includes service revenue related to various account management functions, fee income derived from third-party loans arranged through Clearlane—our online automotive lender exchange, and revenue associated with licensing and marketing from the Ally CashBack Credit Card—our co-branded credit card. These revenue streams are recorded as other income in our Condensed Consolidated Statement of Comprehensive Income. |
Three months ended June 30, 2018 ($ in millions) | Automotive Finance operations | Insurance operations | Mortgage Finance operations | Corporate Finance operations | Corporate and Other | Consolidated | ||||||||||||||||||
Revenue from contracts with customers | ||||||||||||||||||||||||
Noninsurance contracts | $ | — | $ | 125 | $ | — | $ | — | $ | — | $ | 125 | ||||||||||||
Remarketing fee income | 21 | — | — | — | — | 21 | ||||||||||||||||||
Brokerage commissions and other revenue | — | — | — | — | 15 | 15 | ||||||||||||||||||
Brokered/agent commissions | — | 4 | — | — | — | 4 | ||||||||||||||||||
Deposit account and other banking fees | — | — | — | — | 3 | 3 | ||||||||||||||||||
Other | 4 | — | — | — | — | 4 | ||||||||||||||||||
Total revenue from contracts with customers | 25 | 129 | — | — | 18 | 172 | ||||||||||||||||||
All other revenue | 38 | 137 | 2 | 14 | 1 | 192 | ||||||||||||||||||
Total other revenue (a) | $ | 63 | $ | 266 | $ | 2 | $ | 14 | $ | 19 | $ | 364 |
(a) | Represents a component of total net revenue. Refer to Note 22 for further information on our reportable operating segments. |
Six months ended June 30, 2018 ($ in millions) | Automotive Finance operations | Insurance operations | Mortgage Finance operations | Corporate Finance operations | Corporate and Other | Consolidated | ||||||||||||||||||
Revenue from contracts with customers | ||||||||||||||||||||||||
Noninsurance contracts | $ | — | $ | 248 | $ | — | $ | — | $ | — | $ | 248 | ||||||||||||
Remarketing fee income | 44 | — | — | — | — | 44 | ||||||||||||||||||
Brokerage commissions and other revenue | — | — | — | — | 31 | 31 | ||||||||||||||||||
Brokered/agent commissions | — | 8 | — | — | — | 8 | ||||||||||||||||||
Deposit account and other banking fees | — | — | — | — | 6 | 6 | ||||||||||||||||||
Other | 6 | 1 | — | — | — | 7 | ||||||||||||||||||
Total revenue from contracts with customers | 50 | 257 | — | — | 37 | 344 | ||||||||||||||||||
All other revenue | 79 | 255 | 3 | 22 | 15 | 374 | ||||||||||||||||||
Total other revenue (a) | $ | 129 | $ | 512 | $ | 3 | $ | 22 | $ | 52 | $ | 718 |
(a) | Represents a component of total net revenue. Refer to Note 22 for further information on our reportable operating segments. |
Three months ended June 30, | Six months ended June 30, | |||||||||||||||
($ in millions) | 2018 | 2017 | 2018 | 2017 | ||||||||||||
Late charges and other administrative fees | $ | 25 | $ | 25 | $ | 54 | $ | 52 | ||||||||
Remarketing fees | 21 | 27 | 44 | 56 | ||||||||||||
Servicing fees | 8 | 14 | 16 | 30 | ||||||||||||
Income from equity-method investments | 7 | 5 | 13 | 5 | ||||||||||||
Other, net | 36 | 31 | 79 | 73 | ||||||||||||
Total other income, net of losses | $ | 97 | $ | 102 | $ | 206 | $ | 216 |
($ in millions) | 2018 | 2017 | ||||||
Total gross reserves for insurance losses and loss adjustment expenses at January 1, | $ | 140 | $ | 149 | ||||
Less: Reinsurance recoverable | 108 | 108 | ||||||
Net reserves for insurance losses and loss adjustment expenses at January 1, | 32 | 41 | ||||||
Net insurance losses and loss adjustment expenses incurred related to: | ||||||||
Current year | 159 | 211 | ||||||
Prior years (a) | 5 | 2 | ||||||
Total net insurance losses and loss adjustment expenses incurred | 164 | 213 | ||||||
Net insurance losses and loss adjustment expenses paid or payable related to: | ||||||||
Current year | (121 | ) | (183 | ) | ||||
Prior years | (26 | ) | (27 | ) | ||||
Total net insurance losses and loss adjustment expenses paid or payable | (147 | ) | (210 | ) | ||||
Net reserves for insurance losses and loss adjustment expenses at June 30, | 49 | 44 | ||||||
Plus: Reinsurance recoverable | 100 | 135 | ||||||
Total gross reserves for insurance losses and loss adjustment expenses at June 30, | $ | 149 | $ | 179 |
(a) | There have been no material adverse changes to the reserve for prior years. |
Three months ended June 30, | Six months ended June 30, | ||||||||||||||
($ in millions) | 2018 | 2017 | 2018 | 2017 | |||||||||||
Insurance commissions | $ | 109 | $ | 104 | $ | 219 | $ | 203 | |||||||
Technology and communications | 74 | 71 | 145 | 140 | |||||||||||
Lease and loan administration | 40 | 39 | 82 | 75 | |||||||||||
Advertising and marketing | 29 | 33 | 68 | 63 | |||||||||||
Professional services | 35 | 27 | 67 | 53 | |||||||||||
Regulatory and licensing fees | 35 | 28 | 65 | 55 | |||||||||||
Vehicle remarketing and repossession | 26 | 25 | 58 | 53 | |||||||||||
Premises and equipment depreciation | 22 | 23 | 42 | 45 | |||||||||||
Occupancy | 11 | 11 | 22 | 23 | |||||||||||
Non-income taxes | 6 | 8 | 14 | 16 | |||||||||||
Amortization of intangible assets | 3 | 3 | 6 | 6 | |||||||||||
Other | 56 | 48 | 103 | 93 | |||||||||||
Total other operating expenses | $ | 446 | $ | 420 | $ | 891 | $ | 825 |
June 30, 2018 | December 31, 2017 | |||||||||||||||||||||||||||||||
Amortized cost | Gross unrealized | Fair value | Amortized cost | Gross unrealized | Fair value | |||||||||||||||||||||||||||
($ in millions) | gains | losses | gains | losses | ||||||||||||||||||||||||||||
Available-for-sale securities | ||||||||||||||||||||||||||||||||
Debt securities | ||||||||||||||||||||||||||||||||
U.S. Treasury | $ | 1,963 | $ | 1 | $ | (90 | ) | $ | 1,874 | $ | 1,831 | $ | — | $ | (54 | ) | $ | 1,777 | ||||||||||||||
U.S. States and political subdivisions | 865 | 5 | (19 | ) | 851 | 850 | 11 | (7 | ) | 854 | ||||||||||||||||||||||
Foreign government | 155 | 1 | (2 | ) | 154 | 153 | 2 | (1 | ) | 154 | ||||||||||||||||||||||
Agency mortgage-backed residential | 15,559 | 4 | (497 | ) | 15,066 | 14,412 | 35 | (156 | ) | 14,291 | ||||||||||||||||||||||
Mortgage-backed residential | 2,716 | 2 | (93 | ) | 2,625 | 2,517 | 11 | (34 | ) | 2,494 | ||||||||||||||||||||||
Mortgage-backed commercial | 644 | 1 | (3 | ) | 642 | 541 | 1 | (1 | ) | 541 | ||||||||||||||||||||||
Asset-backed | 870 | 2 | (4 | ) | 868 | 933 | 4 | (1 | ) | 936 | ||||||||||||||||||||||
Corporate debt | 1,258 | 1 | (43 | ) | 1,216 | 1,262 | 5 | (11 | ) | 1,256 | ||||||||||||||||||||||
Total available-for-sale securities (a) (b) (c) | $ | 24,030 | $ | 17 | $ | (751 | ) | $ | 23,296 | $ | 22,499 | $ | 69 | $ | (265 | ) | $ | 22,303 | ||||||||||||||
Held-to-maturity securities | ||||||||||||||||||||||||||||||||
Debt securities | ||||||||||||||||||||||||||||||||
Agency mortgage-backed residential (d) | $ | 2,062 | $ | 1 | $ | (83 | ) | $ | 1,980 | $ | 1,863 | $ | 3 | $ | (37 | ) | $ | 1,829 | ||||||||||||||
Asset-backed retained notes | 27 | — | — | 27 | 36 | — | — | 36 | ||||||||||||||||||||||||
Total held-to-maturity securities | $ | 2,089 | $ | 1 | $ | (83 | ) | $ | 2,007 | $ | 1,899 | $ | 3 | $ | (37 | ) | $ | 1,865 |
(a) | Certain entities related to our Insurance operations are required to deposit securities with state regulatory authorities. These deposited securities totaled $12 million at both June 30, 2018, and December 31, 2017. |
(b) | Certain available-for-sale securities are included in fair value hedging relationships. Refer to Note 18 for additional information. |
(c) | Investment securities with a fair value of $7.1 billion and $7.8 billion at June 30, 2018, and December 31, 2017, respectively, were pledged to secure advances from the FHLB, short-term borrowings or repurchase agreements, or for other purposes as required by contractual obligation or law. Under these agreements, we have granted the counterparty the right to sell or pledge $1.2 billion and $1.0 billion of the underlying investment securities at June 30, 2018, and December 31, 2017, respectively. |
(d) | Securities with a fair value of $962 million and $664 million at June 30, 2018, and December 31, 2017, respectively, were pledged to secure advances from the FHLB. |
Total | Due in one year or less | Due after one year through five years | Due after five years through ten years | Due after ten years | |||||||||||||||||||||||||||||||
($ in millions) | Amount | Yield | Amount | Yield | Amount | Yield | Amount | Yield | Amount | Yield | |||||||||||||||||||||||||
June 30, 2018 | |||||||||||||||||||||||||||||||||||
Fair value of available-for-sale securities (a) | |||||||||||||||||||||||||||||||||||
U.S. Treasury | $ | 1,874 | 1.9 | % | $ | 13 | 1.4 | % | $ | 578 | 1.9 | % | $ | 1,283 | 1.8 | % | $ | — | — | % | |||||||||||||||
U.S. States and political subdivisions | 851 | 3.1 | 35 | 3.4 | 53 | 2.2 | 237 | 2.6 | 526 | 3.4 | |||||||||||||||||||||||||
Foreign government | 154 | 2.5 | 25 | 3.3 | 61 | 2.3 | 68 | 2.4 | — | — | |||||||||||||||||||||||||
Agency mortgage-backed residential | 15,066 | 3.2 | — | — | — | — | 25 | 2.0 | 15,041 | 3.2 | |||||||||||||||||||||||||
Mortgage-backed residential | 2,625 | 3.2 | — | — | — | — | — | — | 2,625 | 3.2 | |||||||||||||||||||||||||
Mortgage-backed commercial | 642 | 3.6 | — | — | — | — | 31 | 3.6 | 611 | 3.6 | |||||||||||||||||||||||||
Asset-backed | 868 | 3.3 | — | — | 618 | 3.3 | 137 | 3.6 | 113 | 3.0 | |||||||||||||||||||||||||
Corporate debt | 1,216 | 3.1 | 122 | 2.8 | 472 | 2.7 | 589 | 3.3 | 33 | 4.9 | |||||||||||||||||||||||||
Total available-for-sale securities | $ | 23,296 | 3.1 | $ | 195 | 2.9 | $ | 1,782 | 2.6 | $ | 2,370 | 2.4 | $ | 18,949 | 3.2 | ||||||||||||||||||||
Amortized cost of available-for-sale securities | $ | 24,030 | $ | 195 | $ | 1,811 | $ | 2,476 | $ | 19,548 | |||||||||||||||||||||||||
Amortized cost of held-to-maturity securities | |||||||||||||||||||||||||||||||||||
Agency mortgage-backed residential | $ | 2,062 | 3.1 | % | $ | — | — | % | $ | — | — | % | $ | — | — | % | $ | 2,062 | 3.1 | % | |||||||||||||||
Asset-backed retained notes | 27 | 1.8 | — | — | 26 | 1.8 | 1 | 3.0 | — | — | |||||||||||||||||||||||||
Total held-to-maturity securities | $ | 2,089 | 3.1 | $ | — | — | $ | 26 | 1.8 | $ | 1 | 3.0 | $ | 2,062 | 3.1 | ||||||||||||||||||||
December 31, 2017 | |||||||||||||||||||||||||||||||||||
Fair value of available-for-sale securities (a) | |||||||||||||||||||||||||||||||||||
U.S. Treasury | $ | 1,777 | 1.7 | % | $ | — | — | % | $ | 487 | 1.7 | % | $ | 1,290 | 1.8 | % | $ | — | — | % | |||||||||||||||
U.S. States and political subdivisions | 854 | 2.9 | 76 | 1.8 | 36 | 2.3 | 203 | 2.5 | 539 | 3.3 | |||||||||||||||||||||||||
Foreign government | 154 | 2.5 | — | — | 80 | 2.5 | 74 | 2.4 | — | — | |||||||||||||||||||||||||
Agency mortgage-backed residential | 14,291 | 3.1 | — | — | — | — | 3 | 2.9 | 14,288 | 3.1 | |||||||||||||||||||||||||
Mortgage-backed residential | 2,494 | 3.1 | — | — | — | — | — | — | 2,494 | 3.1 | |||||||||||||||||||||||||
Mortgage-backed commercial | 541 | 3.2 | — | — | 30 | 3.1 | 31 | 3.1 | 480 | 3.2 | |||||||||||||||||||||||||
Asset-backed | 936 | 3.1 | — | — | 698 | 3.1 | 106 | 3.1 | 132 | 2.8 | |||||||||||||||||||||||||
Corporate debt | 1,256 | 2.9 | 140 | 2.6 | 513 | 2.6 | 564 | 3.2 | 39 | 4.7 | |||||||||||||||||||||||||
Total available-for-sale securities | $ | 22,303 | 3.0 | $ | 216 | 2.3 | $ | 1,844 | 2.5 | $ | 2,271 | 2.3 | $ | 17,972 | 3.1 | ||||||||||||||||||||
Amortized cost of available-for-sale securities | $ | 22,499 | $ | 217 | $ | 1,852 | $ | 2,314 | $ | 18,116 | |||||||||||||||||||||||||
Amortized cost of held-to-maturity securities | |||||||||||||||||||||||||||||||||||
Agency mortgage-backed residential | $ | 1,863 | 3.1 | % | $ | — | — | % | $ | — | — | % | $ | — | — | % | $ | 1,863 | 3.1 | % | |||||||||||||||
Asset-backed retained notes | 36 | 1.7 | — | — | 35 | 1.7 | 1 | 3.0 | — | — | |||||||||||||||||||||||||
Total held-to-maturity securities | $ | 1,899 | 3.1 | $ | — | — | $ | 35 | 1.7 | $ | 1 | 3.0 | $ | 1,863 | 3.1 |
(a) | Yield is calculated using the effective yield of each security at the end of the period, weighted based on the market value. The effective yield considers the contractual coupon and amortized cost, and excludes expected capital gains and losses. |
Three months ended June 30, | Six months ended June 30, | ||||||||||||||
($ in millions) | 2018 | 2017 | 2018 | 2017 | |||||||||||
Taxable interest | $ | 164 | $ | 130 | $ | 318 | $ | 249 | |||||||
Taxable dividends | 3 | 3 | 6 | 5 | |||||||||||
Interest and dividends exempt from U.S. federal income tax | 6 | 6 | 12 | 11 | |||||||||||
Interest and dividends on investment securities | $ | 173 | $ | 139 | $ | 336 | $ | 265 |
Three months ended June 30, | Six months ended June 30, | ||||||||||||||
($ in millions) | 2018 | 2017 | 2018 | 2017 | |||||||||||
Available-for-sale securities | |||||||||||||||
Gross realized gains | $ | 1 | $ | 24 | $ | 7 | $ | 51 | |||||||
Gross realized losses (a) | — | (1 | ) | — | (1 | ) | |||||||||
Net realized gains on available-for-sale securities | 1 | 23 | 7 | 50 | |||||||||||
Net realized gain on equity securities | 18 | 40 | |||||||||||||
Net unrealized gain (loss) on equity securities (b) | 8 | (32 | ) | ||||||||||||
Other gain on investments, net | $ | 27 | $ | 23 | $ | 15 | $ | 50 |
(a) | Certain available-for-sale securities were sold at a loss in 2018 and 2017 as a result of market conditions within these respective periods (e.g., a downgrade in the rating of a debt security). Any such sales were made in accordance with our risk management policies and practices. |
(b) | As a result of our adoption of ASU 2016-01, beginning January 1, 2018, changes in the fair value of our portfolio of equity securities are recognized in net income. Prior to adoption, equity securities were included in our available-for-sale portfolio and unrealized changes in fair value were recognized through other comprehensive (loss) income until realized, at which point we recorded a gain or loss on sale. We adopted ASU 2016-01 on January 1, 2018, on a modified retrospective basis with a cumulative effect adjustment as of the beginning of the fiscal year of initial adoption. Refer to the section titled Recently Adopted Accounting Standards in Note 1 for additional information. |
June 30, 2018 | December 31, 2017 | |||||||||||||||||||||||||||||||
Less than 12 months | 12 months or longer | Less than 12 months | 12 months or longer | |||||||||||||||||||||||||||||
($ in millions) | Fair value | Unrealized loss | Fair value | Unrealized loss | Fair value | Unrealized loss | Fair value | Unrealized loss | ||||||||||||||||||||||||
Available-for-sale securities | ||||||||||||||||||||||||||||||||
Debt securities | ||||||||||||||||||||||||||||||||
U.S. Treasury | $ | 485 | $ | (19 | ) | $ | 1,275 | $ | (71 | ) | $ | 471 | $ | (8 | ) | $ | 1,305 | $ | (46 | ) | ||||||||||||
U.S. States and political subdivisions | 420 | (8 | ) | 181 | (11 | ) | 242 | (2 | ) | 183 | (5 | ) | ||||||||||||||||||||
Foreign government | 56 | (1 | ) | 25 | (1 | ) | 80 | (1 | ) | 4 | — | |||||||||||||||||||||
Agency mortgage-backed residential | 8,834 | (215 | ) | 5,331 | (282 | ) | 4,066 | (19 | ) | 5,671 | (137 | ) | ||||||||||||||||||||
Mortgage-backed residential | 1,642 | (35 | ) | 688 | (58 | ) | 857 | (2 | ) | 773 | (32 | ) | ||||||||||||||||||||
Mortgage-backed commercial | 91 | (2 | ) | 18 | (1 | ) | 76 | (1 | ) | 21 | — | |||||||||||||||||||||
Asset-backed | 479 | (3 | ) | 71 | (1 | ) | 220 | (1 | ) | 91 | — | |||||||||||||||||||||
Corporate debt | 885 | (26 | ) | 254 | (17 | ) | 529 | (4 | ) | 194 | (7 | ) | ||||||||||||||||||||
Total temporarily impaired available-for-sale securities | $ | 12,892 | $ | (309 | ) | $ | 7,843 | $ | (442 | ) | $ | 6,541 | $ | (38 | ) | $ | 8,242 | $ | (227 | ) | ||||||||||||
Held-to-maturity securities | ||||||||||||||||||||||||||||||||
Agency mortgage-backed residential | $ | 1,152 | $ | (33 | ) | $ | 668 | $ | (50 | ) | $ | 773 | $ | (5 | ) | $ | 687 | $ | (32 | ) | ||||||||||||
Asset-backed retained certificates | 24 | — | — | — | 35 | — | — | — | ||||||||||||||||||||||||
Total held-to-maturity debt securities | $ | 1,176 | $ | (33 | ) | $ | 668 | $ | (50 | ) | $ | 808 | $ | (5 | ) | $ | 687 | $ | (32 | ) |
($ in millions) | June 30, 2018 | December 31, 2017 | ||||||
Consumer automotive (a) | $ | 70,473 | $ | 68,071 | ||||
Consumer mortgage | ||||||||
Mortgage Finance (b) | 13,328 | 11,657 | ||||||
Mortgage — Legacy (c) | 1,803 | 2,093 | ||||||
Total consumer mortgage | 15,131 | 13,750 | ||||||
Total consumer | 85,604 | 81,821 | ||||||
Commercial | ||||||||
Commercial and industrial | ||||||||
Automotive | 31,501 | 33,025 | ||||||
Other | 4,027 | 3,887 | ||||||
Commercial real estate | 4,412 | 4,160 | ||||||
Total commercial | 39,940 | 41,072 | ||||||
Total finance receivables and loans (d) | $ | 125,544 | $ | 122,893 |
(a) | Certain finance receivables and loans are included in fair value hedging relationships. Refer to Note 18 for additional information. |
(b) | Includes loans originated as interest-only mortgage loans of $18 million and $20 million at June 30, 2018, and December 31, 2017, respectively, 36% of which are expected to start principal amortization in 2019, and 48% in 2020. The remainder of these loans have exited the interest-only period. |
(c) | Includes loans originated as interest-only mortgage loans of $416 million and $496 million at June 30, 2018, and December 31, 2017, respectively, of which 99% have exited the interest-only period. |
(d) | Totals include net unearned income, unamortized premiums and discounts, and deferred fees and costs of $612 million and $551 million at June 30, 2018, and December 31, 2017, respectively. |
Three months ended June 30, 2018 ($ in millions) | Consumer automotive | Consumer mortgage | Commercial | Total | ||||||||||||
Allowance at April 1, 2018 | $ | 1,066 | $ | 74 | $ | 138 | $ | 1,278 | ||||||||
Charge-offs (a) | (296 | ) | (8 | ) | (2 | ) | (306 | ) | ||||||||
Recoveries | 114 | 6 | 6 | 126 | ||||||||||||
Net charge-offs | (182 | ) | (2 | ) | 4 | (180 | ) | |||||||||
Provision for loan losses | 168 | (4 | ) | (6 | ) | 158 | ||||||||||
Other | 1 | (2 | ) | 2 | 1 | |||||||||||
Allowance at June 30, 2018 | $ | 1,053 | $ | 66 | $ | 138 | $ | 1,257 |
(a) | Represents the amount of the gross carrying value directly written off. For consumer and commercial loans, the loss from a charge-off is measured as the difference between the gross carrying value of a loan and the fair value of the collateral, less costs to sell. Refer to Note 1 to the Consolidated Financial Statements in our 2017 Annual Report on Form 10-K for more information regarding our charge-off policies. |
Three months ended June 30, 2017 ($ in millions) | Consumer automotive | Consumer mortgage | Commercial | Total | ||||||||||||
Allowance at April 1, 2017 | $ | 941 | $ | 86 | $ | 128 | $ | 1,155 | ||||||||
Charge-offs (a) | (290 | ) | (6 | ) | — | (296 | ) | |||||||||
Recoveries | 91 | 6 | — | 97 | ||||||||||||
Net charge-offs | (199 | ) | — | — | (199 | ) | ||||||||||
Provision for loan losses | 260 | (3 | ) | 12 | 269 | |||||||||||
Allowance at June 30, 2017 | $ | 1,002 | $ | 83 | $ | 140 | $ | 1,225 |
(a) | Represents the amount of the gross carrying value directly written off. For consumer and commercial loans, the loss from a charge-off is measured as the difference between the gross carrying value of a loan and the fair value of the collateral, less costs to sell. Refer to Note 1 to the Consolidated Financial Statements in our 2017 Annual Report on Form 10-K for more information regarding our charge-off policies. |
Six months ended June 30, 2018 ($ in millions) | Consumer automotive | Consumer mortgage | Commercial | Total | ||||||||||||
Allowance at January 1, 2018 | $ | 1,066 | $ | 79 | $ | 131 | $ | 1,276 | ||||||||
Charge-offs (a) | (661 | ) | (20 | ) | (2 | ) | (683 | ) | ||||||||
Recoveries | 226 | 12 | 6 | 244 | ||||||||||||
Net charge-offs | (435 | ) | (8 | ) | 4 | (439 | ) | |||||||||
Provision for loan losses | 421 | (3 | ) | 1 | 419 | |||||||||||
Other | 1 | (2 | ) | 2 | 1 | |||||||||||
Allowance at June 30, 2018 | $ | 1,053 | $ | 66 | $ | 138 | $ | 1,257 | ||||||||
Allowance for loan losses at June 30, 2018 | ||||||||||||||||
Individually evaluated for impairment | $ | 42 | $ | 24 | $ | 27 | $ | 93 | ||||||||
Collectively evaluated for impairment | 1,011 | 42 | 111 | 1,164 | ||||||||||||
Finance receivables and loans at gross carrying value | ||||||||||||||||
Ending balance | $ | 70,473 | $ | 15,131 | $ | 39,940 | $ | 125,544 | ||||||||
Individually evaluated for impairment | 480 | 228 | 198 | 906 | ||||||||||||
Collectively evaluated for impairment | 69,993 | 14,903 | 39,742 | 124,638 |
(a) | Represents the amount of the gross carrying value directly written off. For consumer and commercial loans, the loss from a charge-off is measured as the difference between the gross carrying value of a loan and the fair value of the collateral, less costs to sell. Refer to Note 1 to the Consolidated Financial Statements in our 2017 Annual Report on Form 10-K for more information regarding our charge-off policies. |
Six months ended June 30, 2017 ($ in millions) | Consumer automotive | Consumer mortgage | Commercial | Total | ||||||||||||
Allowance at January 1, 2017 | $ | 932 | $ | 91 | $ | 121 | $ | 1,144 | ||||||||
Charge-offs (a) | (631 | ) | (15 | ) | — | (646 | ) | |||||||||
Recoveries | 181 | 13 | — | 194 | ||||||||||||
Net charge-offs | (450 | ) | (2 | ) | — | (452 | ) | |||||||||
Provision for loan losses | 527 | (6 | ) | 19 | 540 | |||||||||||
Other (b) | (7 | ) | — | — | (7 | ) | ||||||||||
Allowance at June 30, 2017 | $ | 1,002 | $ | 83 | $ | 140 | $ | 1,225 | ||||||||
Allowance for loan losses at June 30, 2017 | ||||||||||||||||
Individually evaluated for impairment | $ | 34 | $ | 31 | $ | 32 | $ | 97 | ||||||||
Collectively evaluated for impairment | 968 | 52 | 108 | 1,128 | ||||||||||||
Finance receivables and loans at gross carrying value | ||||||||||||||||
Ending balance | $ | 66,774 | $ | 11,294 | $ | 42,460 | $ | 120,528 | ||||||||
Individually evaluated for impairment | 380 | 242 | 151 | 773 | ||||||||||||
Collectively evaluated for impairment | 66,394 | 11,052 | 42,309 | 119,755 |
(a) | Represents the amount of the gross carrying value directly written off. For consumer and commercial loans, the loss from a charge-off is measured as the difference between the gross carrying value of a loan and the fair value of the collateral, less costs to sell. Refer to Note 1 to the Consolidated Financial Statements in our 2017 Annual Report on Form 10-K for more information regarding our charge-off policies. |
(b) | Primarily related to the transfer of finance receivables and loans from held-for-investment to held-for-sale. |
Three months ended June 30, | Six months ended June 30, | |||||||||||||||
($ in millions) | 2018 | 2017 | 2018 | 2017 | ||||||||||||
Consumer automotive | $ | — | $ | 85 | $ | — | $ | 1,298 | ||||||||
Consumer mortgage | 4 | 3 | 5 | 6 | ||||||||||||
Total sales and transfers | $ | 4 | $ | 88 | $ | 5 | $ | 1,304 |
Three months ended June 30, | Six months ended June 30, | |||||||||||||||
($ in millions) | 2018 | 2017 | 2018 | 2017 | ||||||||||||
Consumer automotive | $ | 233 | $ | 611 | $ | 401 | $ | 679 | ||||||||
Consumer mortgage | 852 | 809 | 2,147 | 1,136 | ||||||||||||
Total purchases of finance receivables and loans | $ | 1,085 | $ | 1,420 | $ | 2,548 | $ | 1,815 |
($ in millions) | 30–59 days past due | 60–89 days past due | 90 days or more past due | Total past due | Current | Total finance receivables and loans | ||||||||||||||||||
June 30, 2018 | ||||||||||||||||||||||||
Consumer automotive | $ | 1,706 | $ | 387 | $ | 248 | $ | 2,341 | $ | 68,132 | $ | 70,473 | ||||||||||||
Consumer mortgage | ||||||||||||||||||||||||
Mortgage Finance | 50 | 4 | 11 | 65 | 13,263 | 13,328 | ||||||||||||||||||
Mortgage — Legacy | 38 | 14 | 54 | 106 | 1,697 | 1,803 | ||||||||||||||||||
Total consumer mortgage | 88 | 18 | 65 | 171 | 14,960 | 15,131 | ||||||||||||||||||
Total consumer | 1,794 | 405 | 313 | 2,512 | 83,092 | 85,604 | ||||||||||||||||||
Commercial | ||||||||||||||||||||||||
Commercial and industrial | ||||||||||||||||||||||||
Automotive | — | — | 21 | 21 | 31,480 | 31,501 | ||||||||||||||||||
Other | 4 | — | — | 4 | 4,023 | 4,027 | ||||||||||||||||||
Commercial real estate | — | — | — | — | 4,412 | 4,412 | ||||||||||||||||||
Total commercial | 4 | — | 21 | 25 | 39,915 | 39,940 | ||||||||||||||||||
Total consumer and commercial | $ | 1,798 | $ | 405 | $ | 334 | $ | 2,537 | $ | 123,007 | $ | 125,544 | ||||||||||||
December 31, 2017 | ||||||||||||||||||||||||
Consumer automotive | $ | 1,994 | $ | 478 | $ | 268 | $ | 2,740 | $ | 65,331 | $ | 68,071 | ||||||||||||
Consumer mortgage | ||||||||||||||||||||||||
Mortgage Finance | 60 | 11 | 18 | 89 | 11,568 | 11,657 | ||||||||||||||||||
Mortgage — Legacy | 43 | 25 | 62 | 130 | 1,963 | 2,093 | ||||||||||||||||||
Total consumer mortgage | 103 | 36 | 80 | 219 | 13,531 | 13,750 | ||||||||||||||||||
Total consumer | 2,097 | 514 | 348 | 2,959 | 78,862 | 81,821 | ||||||||||||||||||
Commercial | ||||||||||||||||||||||||
Commercial and industrial | ||||||||||||||||||||||||
Automotive | 5 | — | 3 | 8 | 33,017 | 33,025 | ||||||||||||||||||
Other | — | — | — | — | 3,887 | 3,887 | ||||||||||||||||||
Commercial real estate | — | — | — | — | 4,160 | 4,160 | ||||||||||||||||||
Total commercial | 5 | — | 3 | 8 | 41,064 | 41,072 | ||||||||||||||||||
Total consumer and commercial | $ | 2,102 | $ | 514 | $ | 351 | $ | 2,967 | $ | 119,926 | $ | 122,893 |
($ in millions) | June 30, 2018 | December 31, 2017 | ||||||
Consumer automotive | $ | 602 | $ | 603 | ||||
Consumer mortgage | ||||||||
Mortgage Finance | 18 | 25 | ||||||
Mortgage — Legacy | 87 | 92 | ||||||
Total consumer mortgage | 105 | 117 | ||||||
Total consumer | 707 | 720 | ||||||
Commercial | ||||||||
Commercial and industrial | ||||||||
Automotive | 88 | 27 | ||||||
Other | 104 | 44 | ||||||
Commercial real estate | 6 | 1 | ||||||
Total commercial | 198 | 72 | ||||||
Total consumer and commercial finance receivables and loans | $ | 905 | $ | 792 |
June 30, 2018 | December 31, 2017 | |||||||||||||||||||||||
($ in millions) | Performing | Nonperforming | Total | Performing | Nonperforming | Total | ||||||||||||||||||
Consumer automotive | $ | 69,871 | $ | 602 | $ | 70,473 | $ | 67,468 | $ | 603 | $ | 68,071 | ||||||||||||
Consumer mortgage | ||||||||||||||||||||||||
Mortgage Finance | 13,310 | 18 | 13,328 | 11,632 | 25 | 11,657 | ||||||||||||||||||
Mortgage — Legacy | 1,716 | 87 | 1,803 | 2,001 | 92 | 2,093 | ||||||||||||||||||
Total consumer mortgage | 15,026 | 105 | 15,131 | 13,633 | 117 | 13,750 | ||||||||||||||||||
Total consumer | $ | 84,897 | $ | 707 | $ | 85,604 | $ | 81,101 | $ | 720 | $ | 81,821 |
June 30, 2018 | December 31, 2017 | |||||||||||||||||||||||
($ in millions) | Pass | Criticized (a) | Total | Pass | Criticized (a) | Total | ||||||||||||||||||
Commercial and industrial | ||||||||||||||||||||||||
Automotive | $ | 28,890 | $ | 2,611 | $ | 31,501 | $ | 30,982 | $ | 2,043 | $ | 33,025 | ||||||||||||
Other | 3,260 | 767 | 4,027 | 2,986 | 901 | 3,887 | ||||||||||||||||||
Commercial real estate | 4,193 | 219 | 4,412 | 4,023 | 137 | 4,160 | ||||||||||||||||||
Total commercial | $ | 36,343 | $ | 3,597 | $ | 39,940 | $ | 37,991 | $ | 3,081 | $ | 41,072 |
(a) | Includes loans classified as special mention, substandard, or doubtful. These classifications are based on regulatory definitions and generally represent loans within our portfolio that have a higher default risk or have already defaulted. |
($ in millions) | Unpaid principal balance (a) | Gross carrying value | Impaired with no allowance | Impaired with an allowance | Allowance for impaired loans | |||||||||||||||
June 30, 2018 | ||||||||||||||||||||
Consumer automotive | $ | 491 | $ | 480 | $ | 117 | $ | 363 | $ | 42 | ||||||||||
Consumer mortgage | ||||||||||||||||||||
Mortgage Finance | 10 | 10 | 4 | 6 | — | |||||||||||||||
Mortgage — Legacy | 223 | 218 | 63 | 155 | 24 | |||||||||||||||
Total consumer mortgage | 233 | 228 | 67 | 161 | 24 | |||||||||||||||
Total consumer | 724 | 708 | 184 | 524 | 66 | |||||||||||||||
Commercial | ||||||||||||||||||||
Commercial and industrial | ||||||||||||||||||||
Automotive | 88 | 88 | 16 | 72 | 12 | |||||||||||||||
Other | 116 | 104 | 40 | 64 | 15 | |||||||||||||||
Commercial real estate | 6 | 6 | 4 | 2 | — | |||||||||||||||
Total commercial | 210 | 198 | 60 | 138 | 27 | |||||||||||||||
Total consumer and commercial finance receivables and loans | $ | 934 | $ | 906 | $ | 244 | $ | 662 | $ | 93 | ||||||||||
December 31, 2017 | ||||||||||||||||||||
Consumer automotive | $ | 438 | $ | 430 | $ | 91 | $ | 339 | $ | 36 | ||||||||||
Consumer mortgage | ||||||||||||||||||||
Mortgage Finance | 8 | 8 | 4 | 4 | — | |||||||||||||||
Mortgage — Legacy | 228 | 223 | 58 | 165 | 27 | |||||||||||||||
Total consumer mortgage | 236 | 231 | 62 | 169 | 27 | |||||||||||||||
Total consumer | 674 | 661 | 153 | 508 | 63 | |||||||||||||||
Commercial | ||||||||||||||||||||
Commercial and industrial | ||||||||||||||||||||
Automotive | 27 | 27 | 9 | 18 | 3 | |||||||||||||||
Other | 54 | 44 | 10 | 34 | 11 | |||||||||||||||
Commercial real estate | 1 | 1 | — | 1 | — | |||||||||||||||
Total commercial | 82 | 72 | 19 | 53 | 14 | |||||||||||||||
Total consumer and commercial finance receivables and loans | $ | 756 | $ | 733 | $ | 172 | $ | 561 | $ | 77 |
(a) | Adjusted for charge-offs. |
2018 | 2017 | |||||||||||||||
Three months ended June 30, ($ in millions) | Average balance | Interest income | Average balance | Interest income | ||||||||||||
Consumer automotive | $ | 472 | $ | 7 | $ | 391 | $ | 5 | ||||||||
Consumer mortgage | ||||||||||||||||
Mortgage Finance | 9 | — | 8 | — | ||||||||||||
Mortgage — Legacy | 219 | 3 | 238 | 3 | ||||||||||||
Total consumer mortgage | 228 | 3 | 246 | 3 | ||||||||||||
Total consumer | 700 | 10 | 637 | 8 | ||||||||||||
Commercial | ||||||||||||||||
Commercial and industrial | ||||||||||||||||
Automotive | 78 | 1 | 54 | 1 | ||||||||||||
Other | 82 | — | 73 | 8 | ||||||||||||
Commercial real estate | 5 | — | 6 | — | ||||||||||||
Total commercial | 165 | 1 | 133 | 9 | ||||||||||||
Total consumer and commercial finance receivables and loans | $ | 865 | $ | 11 | $ | 770 | $ | 17 |
2018 | 2017 | |||||||||||||||
Six months ended June 30, ($ in millions) | Average balance | Interest income | Average balance | Interest income | ||||||||||||
Consumer automotive | $ | 462 | $ | 14 | $ | 381 | $ | 10 | ||||||||
Consumer mortgage | ||||||||||||||||
Mortgage Finance | 9 | — | 8 | — | ||||||||||||
Mortgage — Legacy | 220 | 5 | 239 | 5 | ||||||||||||
Total consumer mortgage | 229 | 5 | 247 | 5 | ||||||||||||
Total consumer | 691 | 19 | 628 | 15 | ||||||||||||
Commercial | ||||||||||||||||
Commercial and industrial | ||||||||||||||||
Automotive | 61 | 2 | 47 | 1 | ||||||||||||
Other | 66 | — | 77 | 8 | ||||||||||||
Commercial real estate | 4 | — | 6 | — | ||||||||||||
Total commercial | 131 | 2 | 130 | 9 | ||||||||||||
Total consumer and commercial finance receivables and loans | $ | 822 | $ | 21 | $ | 758 | $ | 24 |
2018 | 2017 | ||||||||||||||||||||
Three months ended June 30, ($ in millions) | Number of loans | Pre-modification gross carrying value | Post-modification gross carrying value | Number of loans | Pre-modification gross carrying value | Post-modification gross carrying value | |||||||||||||||
Consumer automotive | 5,898 | $ | 107 | $ | 93 | 5,762 | $ | 103 | $ | 88 | |||||||||||
Consumer mortgage | |||||||||||||||||||||
Mortgage Finance | 7 | 2 | 2 | — | — | — | |||||||||||||||
Mortgage — Legacy | 27 | 6 | 7 | 19 | 3 | 2 | |||||||||||||||
Total consumer mortgage | 34 | 8 | 9 | 19 | 3 | 2 | |||||||||||||||
Total consumer | 5,932 | 115 | 102 | 5,781 | 106 | 90 | |||||||||||||||
Commercial | |||||||||||||||||||||
Commercial and industrial | |||||||||||||||||||||
Automotive | 3 | 4 | 4 | — | — | — | |||||||||||||||
Other | 2 | 55 | 51 | 1 | 21 | 21 | |||||||||||||||
Total commercial | 5 | 59 | 55 | 1 | 21 | 21 | |||||||||||||||
Total consumer and commercial finance receivables and loans | 5,937 | $ | 174 | $ | 157 | 5,782 | $ | 127 | $ | 111 |
2018 | 2017 | ||||||||||||||||||||
Six months ended June 30, ($ in millions) | Number of loans | Pre-modification gross carrying value | Post-modification gross carrying value | Number of loans | Pre-modification gross carrying value | Post-modification gross carrying value | |||||||||||||||
Consumer automotive | 12,940 | $ | 235 | $ | 203 | 12,209 | $ | 218 | $ | 187 | |||||||||||
Consumer mortgage | |||||||||||||||||||||
Mortgage Finance | 8 | 3 | 3 | 1 | — | — | |||||||||||||||
Mortgage — Legacy | 89 | 16 | 16 | 72 | 15 | 14 | |||||||||||||||
Total consumer mortgage | 97 | 19 | 19 | 73 | 15 | 14 | |||||||||||||||
Total consumer | 13,037 | 254 | 222 | 12,282 | 233 | 201 | |||||||||||||||
Commercial | |||||||||||||||||||||
Commercial and industrial | |||||||||||||||||||||
Automotive | 3 | 4 | 4 | — | — | — | |||||||||||||||
Other | 2 | 55 | 51 | 2 | 44 | 44 | |||||||||||||||
Total commercial | 5 | 59 | 55 | 2 | 44 | 44 | |||||||||||||||
Total consumer and commercial finance receivables and loans | 13,042 | $ | 313 | $ | 277 | 12,284 | $ | 277 | $ | 245 |
2018 | 2017 | |||||||||||||||||||||
Three months ended June 30, ($ in millions) | Number of loans | Gross carrying value | Charge-off amount | Number of loans | Gross carrying value | Charge-off amount | ||||||||||||||||
Consumer automotive | 2,425 | $ | 29 | $ | 17 | 2,143 | $ | 25 | $ | 17 | ||||||||||||
Consumer mortgage | ||||||||||||||||||||||
Mortgage Finance | — | — | — | — | — | — | ||||||||||||||||
Mortgage — Legacy | 1 | — | — | — | — | — | ||||||||||||||||
Total consumer finance receivables and loans | 2,426 | $ | 29 | $ | 17 | 2,143 | $ | 25 | $ | 17 |
2018 | 2017 | |||||||||||||||||||||
Six months ended June 30, ($ in millions) | Number of loans | Gross carrying value | Charge-off amount | Number of loans | Gross carrying value | Charge-off amount | ||||||||||||||||
Consumer automotive | 4,751 | $ | 57 | $ | 35 | 4,132 | $ | 49 | $ | 33 | ||||||||||||
Consumer mortgage | ||||||||||||||||||||||
Mortgage Finance | — | — | — | 1 | 1 | — | ||||||||||||||||
Mortgage — Legacy | 1 | — | — | — | — | — | ||||||||||||||||
Total consumer finance receivables and loans | 4,752 | $ | 57 | $ | 35 | 4,133 | $ | 50 | $ | 33 |
($ in millions) | June 30, 2018 | December 31, 2017 | ||||||
Vehicles | $ | 10,260 | $ | 10,556 | ||||
Accumulated depreciation | (1,621 | ) | (1,815 | ) | ||||
Investment in operating leases, net | $ | 8,639 | $ | 8,741 |
Three months ended June 30, | Six months ended June 30, | |||||||||||||||
($ in millions) | 2018 | 2017 | 2018 | 2017 | ||||||||||||
Depreciation expense on operating lease assets (excluding remarketing gains) | $ | 281 | $ | 353 | $ | 572 | $ | 739 | ||||||||
Remarketing gains | (16 | ) | (32 | ) | (34 | ) | (29 | ) | ||||||||
Net depreciation expense on operating lease assets | $ | 265 | $ | 321 | $ | 538 | $ | 710 |
($ in millions) | Carrying value of total assets | Carrying value of total liabilities | Assets sold to nonconsolidated VIEs (a) | Maximum exposure to loss in nonconsolidated VIEs | |||||||||||||
June 30, 2018 | |||||||||||||||||
On-balance sheet variable interest entities | |||||||||||||||||
Consumer automotive | $ | 18,806 | (b) | $ | 8,787 | (c) | |||||||||||
Commercial automotive | 9,945 | 3,595 | |||||||||||||||
Off-balance sheet variable interest entities | |||||||||||||||||
Consumer automotive | 28 | (d) | — | $ | 1,388 | $ | 1,416 | (e) | |||||||||
Commercial other | 739 | (f) | 344 | (g) | — | 968 | (h) | ||||||||||
Total | $ | 29,518 | $ | 12,726 | $ | 1,388 | $ | 2,384 | |||||||||
December 31, 2017 | |||||||||||||||||
On-balance sheet variable interest entities | |||||||||||||||||
Consumer automotive | $ | 17,597 | (b) | $ | 7,677 | (c) | |||||||||||
Commercial automotive | 12,550 | 2,558 | |||||||||||||||
Off-balance sheet variable interest entities | |||||||||||||||||
Consumer automotive | 37 | (d) | — | $ | 1,964 | $ | 2,001 | (e) | |||||||||
Commercial other | 592 | (f) | 248 | (g) | — | 790 | (h) | ||||||||||
Total | $ | 30,776 | $ | 10,483 | $ | 1,964 | $ | 2,791 |
(a) | Asset values represent the current unpaid principal balance of outstanding consumer finance receivables and loans within the VIEs. |
(b) | Includes $8.5 billion of assets that were not encumbered by VIE beneficial interests held by third parties at both June 30, 2018, and December 31, 2017. Ally or consolidated affiliates hold the interests in these assets. |
(c) | Includes $25 million and $29 million of liabilities that were not obligations to third-party beneficial interest holders at June 30, 2018, and December 31, 2017, respectively. |
(d) | Represents retained notes and certificated residual interests, of which $27 million and $36 million were classified as held-to-maturity securities at June 30, 2018, and December 31, 2017, respectively, and $1 million was classified as other assets at both June 30, 2018, and December 31, 2017. These assets represent our compliance with the risk retention rules under the Dodd-Frank Act, requiring us to retain at least five percent of the credit risk of the assets underlying asset-backed securitizations. |
(e) | Maximum exposure to loss represents the current unpaid principal balance of outstanding loans, retained notes, certificated residual interests, as well as certain noncertificated interests retained from the sale of automotive finance receivables. This measure is based on the very unlikely event that all of our sold loans have defects that would trigger a representation and warranty provision and the underlying collateral supporting the loans becomes worthless. This required disclosure is not an indication of our expected loss. |
(f) | Amounts are classified as other assets. |
(g) | Amounts are classified as accrued expenses and other liabilities. |
(h) | For certain nonconsolidated affordable housing entities, maximum exposure to loss represents the yield we guaranteed investors through long-term guarantee contracts. The amount disclosed is based on the unlikely event that the underlying properties cease generating yield to investors and the yield delivered to investors in the form of low income tax housing credits is recaptured. For nonconsolidated equity investments, maximum exposure to loss represents our outstanding investment, additional committed capital, and low income housing tax credits subject to recapture. The amount disclosed is based on the unlikely event that our committed capital is funded, our investments become worthless, and the tax credits previously delivered to us are recaptured. This required disclosure is not an indication of our expected loss. |
Six months ended June 30, ($ in millions) | Consumer automotive | Consumer mortgage | ||||||
2018 | ||||||||
Cash disbursements for repurchases during the period | $ | (2 | ) | $ | — | |||
Servicing fees | 10 | — | ||||||
Cash flows received on retained interests in securitization entities | 9 | — | ||||||
Representation and warranty recoveries | — | 2 | ||||||
2017 | ||||||||
Cash proceeds from transfers completed during the period | $ | 1,187 | $ | — | ||||
Cash disbursements for repurchases during the period (a) | (491 | ) | — | |||||
Servicing fees | 18 | — | ||||||
Cash flows received on retained interests in securitization entities | 10 | — | ||||||
Other cash flows | 4 | — |
(a) | During the second quarter of 2017, we elected to not renew a retail automotive credit conduit facility and also purchased the related retail automotive loans and settled associated retained interests. |
Total amount | Amount 60 days or more past due | ||||||||||||||
($ in millions) | June 30, 2018 | December 31, 2017 | June 30, 2018 | December 31, 2017 | |||||||||||
Off-balance sheet securitization entities | |||||||||||||||
Consumer automotive | $ | 1,388 | $ | 1,964 | $ | 12 | $ | 16 | |||||||
Total off-balance sheet securitization entities | 1,388 | 1,964 | 12 | 16 | |||||||||||
Whole-loan sales (a) | 964 | 1,399 | 3 | 4 | |||||||||||
Total | $ | 2,352 | $ | 3,363 | $ | 15 | $ | 20 |
(a) | Whole-loan sales are not part of a securitization transaction, but represent consumer automotive pools of loans sold to third-party investors. |
Net credit losses | ||||||||||||||||
Three months ended June 30, | Six months ended June 30, | |||||||||||||||
($ in millions) | 2018 | 2017 | 2018 | 2017 | ||||||||||||
Off-balance sheet securitization entities | ||||||||||||||||
Consumer automotive | $ | 2 | $ | 3 | $ | 5 | $ | 6 | ||||||||
Total off-balance sheet securitization entities | 2 | 3 | 5 | 6 | ||||||||||||
Whole-loan sales (a) | — | 1 | 1 | 2 | ||||||||||||
Total | $ | 2 | $ | 4 | $ | 6 | $ | 8 |
(a) | Whole-loan sales are not part of a securitization transaction, but represent consumer automotive pools of loans sold to third-party investors. |
($ in millions) | June 30, 2018 | December 31, 2017 | |||||
On-balance sheet automotive finance loans and leases | |||||||
Consumer automotive | $ | 69,701 | $ | 67,631 | |||
Commercial automotive | 35,645 | 37,058 | |||||
Operating leases | 8,613 | 8,682 | |||||
Other | 111 | 121 | |||||
Off-balance sheet automotive finance loans | |||||||
Securitizations | 1,392 | 1,977 | |||||
Whole-loan sales | 969 | 1,409 | |||||
Total serviced automotive finance loans and leases | $ | 116,431 | $ | 116,878 |
($ in millions) | June 30, 2018 | December 31, 2017 | ||||||
Property and equipment at cost | $ | 1,161 | $ | 1,064 | ||||
Accumulated depreciation | (648 | ) | (608 | ) | ||||
Net property and equipment | 513 | 456 | ||||||
Nonmarketable equity investments (a) | 1,276 | 1,233 | ||||||
Restricted cash collections for securitization trusts (b) | 796 | 812 | ||||||
Accrued interest and rent receivables | 548 | 550 | ||||||
Net deferred tax assets | 455 | 461 | ||||||
Other accounts receivable | 289 | 116 | ||||||
Goodwill (c) | 240 | 240 | ||||||
Restricted cash and cash equivalents (d) | 116 | 94 | ||||||
Cash reserve deposits held for securitization trusts (e) | 103 | 111 | ||||||
Fair value of derivative contracts in receivable position (f) | 63 | 39 | ||||||
Cash collateral placed with counterparties | 35 | 29 | ||||||
Other assets | 1,580 | 1,522 | ||||||
Total other assets | $ | 6,014 | $ | 5,663 |
(a) | Includes investments in FHLB stock of $790 million and $745 million at June 30, 2018, and December 31, 2017, respectively; FRB stock of $447 million and $445 million at June 30, 2018, and December 31, 2017, respectively; and equity securities without a readily determinable fair value of $39 million at June 30, 2018, measured at cost with adjustments for impairment and observable changes in price. During the three months and six months ended June 30, 2018, we recorded $1 million in impairment related to equity securities without a readily determinable fair value. |
(b) | Represents cash collections from customer payments on securitized receivables. These funds are distributed to investors as payments on the related secured debt. |
(c) | Includes goodwill of $27 million within our Insurance operations at both June 30, 2018, and December 31, 2017; $193 million within Corporate and Other at both June 30, 2018, and December 31, 2017; and $20 million within Automotive Finance operations at both June 30, 2018, and December 31, 2017. No changes to the carrying amount of goodwill were recorded during the six months ended June 30, 2018. |
(d) | Primarily represents a number of arrangements with third parties where certain restrictions are placed on balances we hold due to collateral agreements associated with operational processes with a third-party bank, or letter of credit arrangements and corresponding collateral requirements. |
(e) | Represents credit enhancement in the form of cash reserves for various securitization transactions. |
(f) | For additional information on derivative instruments and hedging activities, refer to Note 18. |
($ in millions) | June 30, 2018 | December 31, 2017 | |||||
Noninterest-bearing deposits | $ | 153 | $ | 108 | |||
Interest-bearing deposits | |||||||
Savings and money market checking accounts | 50,958 | 49,267 | |||||
Certificates of deposit | 47,617 | 43,869 | |||||
Dealer deposits | 6 | 12 | |||||
Total deposit liabilities | $ | 98,734 | $ | 93,256 |
June 30, 2018 | December 31, 2017 | |||||||||||||||||||||||
($ in millions) | Unsecured | Secured (a) | Total | Unsecured | Secured (a) | Total | ||||||||||||||||||
Demand notes | $ | 2,666 | $ | — | $ | 2,666 | $ | 3,171 | $ | — | $ | 3,171 | ||||||||||||
Federal Home Loan Bank | — | 3,475 | 3,475 | — | 7,350 | 7,350 | ||||||||||||||||||
Financial instruments sold under agreements to repurchase | — | 967 | 967 | — | 892 | 892 | ||||||||||||||||||
Total short-term borrowings | $ | 2,666 | $ | 4,442 | $ | 7,108 | $ | 3,171 | $ | 8,242 | $ | 11,413 |
(a) | Refer to the section below titled Long-term Debt for further details on assets restricted as collateral for payment of the related debt. |
June 30, 2018 | December 31, 2017 | |||||||||||||||||||||||
($ in millions) | Unsecured | Secured | Total | Unsecured | Secured | Total | ||||||||||||||||||
Long-term debt | ||||||||||||||||||||||||
Due within one year | $ | 2,740 | $ | 8,016 | $ | 10,756 | $ | 3,482 | $ | 7,499 | $ | 10,981 | ||||||||||||
Due after one year (a) | 11,139 | 25,334 | 36,473 | 11,909 | 21,128 | 33,037 | ||||||||||||||||||
Fair value adjustment (b) | 168 | (69 | ) | 99 | 240 | (32 | ) | 208 | ||||||||||||||||
Total long-term debt (c) | $ | 14,047 | $ | 33,281 | $ | 47,328 | $ | 15,631 | $ | 28,595 | $ | 44,226 |
(a) | Includes $2.6 billion of trust preferred securities at both June 30, 2018, and December 31, 2017. |
(b) | Represents the basis adjustment associated with the application of hedge accounting on certain of our long-term debt positions. Refer to Note 18 for additional information. |
(c) | Includes advances from the FHLB of Pittsburgh of $14.7 billion and $10.3 billion at June 30, 2018, and December 31, 2017, respectively. |
($ in millions) | 2018 | 2019 | 2020 | 2021 | 2022 | 2023 and thereafter | Fair value adjustment | Total | ||||||||||||||||||||||||
Unsecured | ||||||||||||||||||||||||||||||||
Long-term debt | $ | 1,991 | $ | 1,681 | $ | 2,251 | $ | 663 | $ | 1,066 | $ | 7,414 | $ | 168 | $ | 15,234 | ||||||||||||||||
Original issue discount | (52 | ) | (38 | ) | (39 | ) | (43 | ) | (47 | ) | (968 | ) | — | (1,187 | ) | |||||||||||||||||
Total unsecured | 1,939 | 1,643 | 2,212 | 620 | 1,019 | 6,446 | 168 | 14,047 | ||||||||||||||||||||||||
Secured | ||||||||||||||||||||||||||||||||
Long-term debt | 3,356 | 7,995 | 7,430 | 8,484 | 4,562 | 1,523 | (69 | ) | 33,281 | |||||||||||||||||||||||
Total long-term debt | $ | 5,295 | $ | 9,638 | $ | 9,642 | $ | 9,104 | $ | 5,581 | $ | 7,969 | $ | 99 | $ | 47,328 |
June 30, 2018 | December 31, 2017 | |||||||||||||||
($ in millions) | Total (a) | Ally Bank | Total (a) | Ally Bank | ||||||||||||
Investment securities (b) | $ | 7,902 | $ | 6,995 | $ | 8,371 | $ | 7,443 | ||||||||
Mortgage assets held-for-investment and lending receivables | 14,943 | 14,943 | 13,579 | 13,579 | ||||||||||||
Consumer automotive finance receivables | 18,965 | 9,621 | 19,787 | 6,200 | ||||||||||||
Commercial automotive finance receivables | 14,252 | 14,211 | 16,567 | 16,472 | ||||||||||||
Operating leases | 267 | — | 457 | — | ||||||||||||
Total assets restricted as collateral (c) (d) | $ | 56,329 | $ | 45,770 | $ | 58,761 | $ | 43,694 | ||||||||
Secured debt | $ | 37,723 | (e) | $ | 27,990 | $ | 36,837 | (e) | $ | 23,278 |
(a) | Ally Bank is a component of the total column. |
(b) | A portion of the restricted investment securities at June 30, 2018, and December 31, 2017, were restricted under repurchase agreements. Refer to the section above titled Short-term Borrowings for information on the repurchase agreements. |
(c) | Ally Bank has an advance agreement with the FHLB, and had assets pledged to secure borrowings that were restricted as collateral to the FHLB totaling $26.3 billion and $25.2 billion at June 30, 2018, and December 31, 2017, respectively. These assets were composed primarily of consumer mortgage finance receivables and loans and investment securities. Ally Bank has access to the FRB Discount Window. Ally Bank had assets pledged and restricted as collateral to the FRB totaling $2.4 billion and $2.3 billion at June 30, 2018, and December 31, 2017, respectively. These assets were composed of consumer automotive finance receivables and loans. Availability under these programs is only for the operations of Ally Bank and cannot be used to fund the operations or liabilities of Ally or its subsidiaries. |
(d) | Excludes restricted cash and cash reserves for securitization trusts recorded within other assets on the Condensed Consolidated Balance Sheet. Refer to Note 11 for additional information. |
(e) | Includes $4.4 billion and $8.2 billion of short-term borrowings at June 30, 2018, and December 31, 2017, respectively. |
Outstanding | Unused capacity (a) | Total capacity | ||||||||||||||||||||||
($ in millions) | June 30, 2018 | December 31, 2017 | June 30, 2018 | December 31, 2017 | June 30, 2018 | December 31, 2017 | ||||||||||||||||||
Bank funding | ||||||||||||||||||||||||
Secured | $ | 2,500 | $ | 1,785 | $ | — | $ | 890 | $ | 2,500 | $ | 2,675 | ||||||||||||
Parent funding | ||||||||||||||||||||||||
Secured | 3,855 | 6,330 | 2,870 | 2,920 | 6,725 | 9,250 | ||||||||||||||||||
Total committed facilities | $ | 6,355 | $ | 8,115 | $ | 2,870 | $ | 3,810 | $ | 9,225 | $ | 11,925 |
(a) | Funding from committed secured facilities is available on request in the event excess collateral resides in certain facilities or the extent incremental collateral is available and contributed to the facilities. |
($ in millions) | June 30, 2018 | December 31, 2017 | ||||||
Accounts payable | $ | 369 | $ | 746 | ||||
Employee compensation and benefits | 188 | 248 | ||||||
Reserves for insurance losses and loss adjustment expenses | 149 | 140 | ||||||
Fair value of derivative contracts in payable position (a) | 65 | 41 | ||||||
Cash collateral received from counterparties | 39 | 17 | ||||||
Deferred revenue | 28 | 32 | ||||||
Other liabilities | 673 | 556 | ||||||
Total accrued expenses and other liabilities | $ | 1,511 | $ | 1,780 |
(a) | For additional information on derivative instruments and hedging activities, refer to Note 18. |
($ in millions) | Unrealized (losses) gains on investment securities (a) | Translation adjustments and net investment hedges (b) | Cash flow hedges (b) | Defined benefit pension plans | Accumulated other comprehensive loss | ||||||||||||||
Balance at December 31, 2016 | $ | (273 | ) | $ | 14 | $ | 8 | $ | (90 | ) | $ | (341 | ) | ||||||
2017 net change | 96 | — | 1 | (1 | ) | 96 | |||||||||||||
Balance at June 30, 2017 | $ | (177 | ) | $ | 14 | $ | 9 | $ | (91 | ) | $ | (245 | ) | ||||||
Balance at December 31, 2017, before cumulative effect of adjustments | $ | (173 | ) | $ | 16 | $ | 11 | $ | (89 | ) | $ | (235 | ) | ||||||
Cumulative effect of changes in accounting principles, net of tax (c) | |||||||||||||||||||
Adoption of Accounting Standards Update 2016-01 | 27 | — | — | — | 27 | ||||||||||||||
Adoption of Accounting Standards Update 2018-02 | (40 | ) | 4 | — | (6 | ) | (42 | ) | |||||||||||
Balance at January 1, 2018, after cumulative effect of adjustments | (186 | ) | 20 | 11 | (95 | ) | (250 | ) | |||||||||||
2018 net change | (412 | ) | (1 | ) | 17 | (2 | ) | (398 | ) | ||||||||||
Balance at June 30, 2018 | $ | (598 | ) | $ | 19 | $ | 28 | $ | (97 | ) | $ | (648 | ) |
(a) | Represents the after-tax difference between the fair value and amortized cost of our available-for-sale securities portfolio. |
(b) | For additional information on derivative instruments and hedging activities, refer to Note 18. |
(c) | Refer to the section titled Recently Adopted Accounting Standards in Note 1 for additional information. |
Three months ended June 30, 2018 ($ in millions) | Before tax | Tax effect | After tax | ||||||||
Investment securities | |||||||||||
Net unrealized losses arising during the period | $ | (95 | ) | $ | 22 | $ | (73 | ) | |||
Less: Net realized gains reclassified to income from continuing operations | 1 | (a) | — | (b) | 1 | ||||||
Net change | (96 | ) | 22 | (74 | ) | ||||||
Translation adjustments | |||||||||||
Net unrealized losses arising during the period | (3 | ) | 1 | (2 | ) | ||||||
Net investment hedges (c) | |||||||||||
Net unrealized gains arising during the period | 3 | (1 | ) | 2 | |||||||
Cash flow hedges (c) | |||||||||||
Net unrealized gains arising during the period | 5 | (2 | ) | 3 | |||||||
Defined benefit pension plans | |||||||||||
Net unrealized gains arising during the period | 1 | — | 1 | ||||||||
Other comprehensive loss | $ | (90 | ) | $ | 20 | $ | (70 | ) |
(a) | Includes gains reclassified to other gain on investments, net in our Condensed Consolidated Statement of Comprehensive Income. |
(b) | Includes amounts reclassified to income tax expense from continuing operations in our Condensed Consolidated Statement of Comprehensive Income. |
(c) | For additional information on derivative instruments and hedging activities, refer to Note 18. |
Three months ended June 30, 2017 ($ in millions) | Before tax | Tax effect | After tax | ||||||||
Investment securities | |||||||||||
Net unrealized gains arising during the period | $ | 132 | $ | (37 | ) | $ | 95 | ||||
Less: Net realized gains reclassified to income from continuing operations | 23 | (a) | (3 | ) | (b) | 20 | |||||
Net change | 109 | (34 | ) | 75 | |||||||
Translation adjustments | |||||||||||
Net unrealized gains arising during the period | 4 | (1 | ) | 3 | |||||||
Net investment hedges (c) | |||||||||||
Net unrealized losses arising during the period | (4 | ) | 1 | (3 | ) | ||||||
Cash flow hedges (c) | |||||||||||
Net unrealized gains arising during the period | 1 | — | 1 | ||||||||
Other comprehensive income | $ | 110 | $ | (34 | ) | $ | 76 |
(a) | Includes gains reclassified to other gain on investments, net in our Condensed Consolidated Statement of Comprehensive Income. |
(b) | Includes amounts reclassified to income tax expense from continuing operations in our Condensed Consolidated Statement of Comprehensive Income. |
(c) | For additional information on derivative instruments and hedging activities, refer to Note 18. |
Six months ended June 30, 2018 ($ in millions) | Before tax | Tax effect | After tax | ||||||||
Investment securities | |||||||||||
Net unrealized losses arising during the period | $ | (531 | ) | $ | 125 | $ | (406 | ) | |||
Less: Net realized gains reclassified to income from continuing operations | 7 | (a) | (1 | ) | (b) | 6 | |||||
Net change | (538 | ) | 126 | (412 | ) | ||||||
Translation adjustments | |||||||||||
Net unrealized losses arising during the period | (8 | ) | 2 | (6 | ) | ||||||
Net investment hedges (c) | |||||||||||
Net unrealized gains arising during the period | 7 | (2 | ) | 5 | |||||||
Cash flow hedges (c) | |||||||||||
Net unrealized gains arising during the period | 23 | (6 | ) | 17 | |||||||
Defined benefit pension plans | |||||||||||
Net unrealized losses arising during the period | (2 | ) | — | (2 | ) | ||||||
Other comprehensive loss | $ | (518 | ) | $ | 120 | $ | (398 | ) |
(a) | Includes gains reclassified to other gain on investments, net in our Condensed Consolidated Statement of Comprehensive Income. |
(b) | Includes amounts reclassified to income tax expense from continuing operations in our Condensed Consolidated Statement of Comprehensive Income. |
(c) | For additional information on derivative instruments and hedging activities, refer to Note 18. |
Six months ended June 30, 2017 ($ in millions) | Before tax | Tax effect | After tax | ||||||||
Investment securities | |||||||||||
Net unrealized gains arising during the period | $ | 183 | $ | (42 | ) | $ | 141 | ||||
Less: Net realized gains reclassified to income from continuing operations | 50 | (a) | (5 | ) | (b) | 45 | |||||
Net change | 133 | (37 | ) | 96 | |||||||
Translation adjustments | |||||||||||
Net unrealized gains arising during the period | 6 | (2 | ) | 4 | |||||||
Net investment hedges (c) | |||||||||||
Net unrealized losses arising during the period | (6 | ) | 2 | (4 | ) | ||||||
Cash flow hedges (c) | |||||||||||
Net unrealized gains arising during the period | 1 | — | 1 | ||||||||
Defined benefit pension plans | |||||||||||
Net unrealized losses arising during the period | (1 | ) | — | (1 | ) | ||||||
Other comprehensive income | $ | 133 | $ | (37 | ) | $ | 96 |
(a) | Includes gains reclassified to other gain on investments, net in our Condensed Consolidated Statement of Comprehensive Income. |
(b) | Includes amounts reclassified to income tax expense from continuing operations in our Condensed Consolidated Statement of Comprehensive Income. |
(c) | For additional information on derivative instruments and hedging activities, refer to Note 18. |
Three months ended June 30, | Six months ended June 30, | |||||||||||||||
($ in millions, except per share data; shares in thousands) (a) | 2018 | 2017 | 2018 | 2017 | ||||||||||||
Net income from continuing operations attributable to common stockholders | $ | 348 | $ | 254 | $ | 600 | $ | 467 | ||||||||
Income (loss) from discontinued operations, net of tax | 1 | (2 | ) | (1 | ) | (1 | ) | |||||||||
Net income attributable to common stockholders | $ | 349 | $ | 252 | $ | 599 | $ | 466 | ||||||||
Basic weighted-average common shares outstanding (b) | 430,628 | 457,891 | 433,405 | 461,904 | ||||||||||||
Diluted weighted-average common shares outstanding (b) | 432,554 | 458,819 | 435,727 | 462,802 | ||||||||||||
Basic earnings per common share | ||||||||||||||||
Net income from continuing operations | $ | 0.81 | $ | 0.55 | $ | 1.38 | $ | 1.01 | ||||||||
Loss from discontinued operations, net of tax | — | (0.01 | ) | — | — | |||||||||||
Net income | $ | 0.81 | $ | 0.55 | $ | 1.38 | $ | 1.01 | ||||||||
Diluted earnings per common share | ||||||||||||||||
Net income from continuing operations | $ | 0.80 | $ | 0.55 | $ | 1.38 | $ | 1.01 | ||||||||
Loss from discontinued operations, net of tax | — | (0.01 | ) | — | — | |||||||||||
Net income | $ | 0.81 | $ | 0.55 | $ | 1.37 | $ | 1.01 |
(a) | Figures in the table may not recalculate exactly due to rounding. Earnings per share is calculated based on unrounded numbers. |
(b) | Includes shares related to share-based compensation that vested but were not yet issued for the three months and six months ended June 30, 2018, and 2017. |
June 30, 2018 | December 31, 2017 | Required minimum (a) | Well-capitalized minimum | ||||||||||||||||
($ in millions) | Amount | Ratio | Amount | Ratio | |||||||||||||||
Capital ratios | |||||||||||||||||||
Common Equity Tier 1 (to risk-weighted assets) | |||||||||||||||||||
Ally Financial Inc. | $ | 13,265 | 9.37 | % | $ | 13,237 | 9.53 | % | 4.50 | % | (b) | ||||||||
Ally Bank | 16,591 | 13.65 | 17,059 | 15.04 | 4.50 | 6.50 | % | ||||||||||||
Tier 1 (to risk-weighted assets) | |||||||||||||||||||
Ally Financial Inc. | $ | 15,698 | 11.09 | % | $ | 15,628 | 11.25 | % | 6.00 | % | 6.00 | % | |||||||
Ally Bank | 16,591 | 13.65 | 17,059 | 15.04 | 6.00 | 8.00 | |||||||||||||
Total (to risk-weighted assets) | |||||||||||||||||||
Ally Financial Inc. | $ | 17,926 | 12.66 | % | $ | 17,974 | 12.94 | % | 8.00 | % | 10.00 | % | |||||||
Ally Bank | 17,557 | 14.45 | 17,886 | 15.77 | 8.00 | 10.00 | |||||||||||||
Tier 1 leverage (to adjusted quarterly average assets) (c) | |||||||||||||||||||
Ally Financial Inc. | $ | 15,698 | 9.21 | % | $ | 15,628 | 9.53 | % | 4.00 | % | (b) | ||||||||
Ally Bank | 16,591 | 11.50 | 17,059 | 12.87 | 4.00 | 5.00 | % |
(a) | In addition to the minimum risk-based capital requirements for common equity Tier 1 capital, Tier 1 capital, and total capital ratios, Ally and Ally Bank were required to maintain a minimum capital conservation buffer of 1.875% and 1.25% at June 30, 2018, and December 31, 2017, respectively, which ultimately increases to 2.5% on January 1, 2019. |
(b) | Currently, there is no ratio component for determining whether a BHC is “well-capitalized.” |
(c) | Federal regulatory reporting guidelines require the calculation of adjusted quarterly average assets using a daily average methodology. |
Common stock repurchased during period (a) | Number of common shares outstanding | Cash dividends declared per common share (b) | |||||||||||||||
($ in millions, except per share data; shares in thousands) | Approximate dollar value | Number of shares | Beginning of period | End of period | |||||||||||||
2016 | |||||||||||||||||
Third quarter | $ | 159 | 8,298 | 483,753 | 475,470 | $ | 0.08 | ||||||||||
Fourth quarter | 167 | 8,745 | 475,470 | 467,000 | 0.08 | ||||||||||||
2017 | |||||||||||||||||
First quarter | $ | 169 | 8,097 | 467,000 | 462,193 | $ | 0.08 | ||||||||||
Second quarter | 204 | 10,485 | 462,193 | 452,292 | 0.08 | ||||||||||||
Third quarter | 190 | 8,507 | 452,292 | 443,796 | 0.12 | ||||||||||||
Fourth quarter | 190 | 7,033 | 443,796 | 437,054 | 0.12 | ||||||||||||
2018 | |||||||||||||||||
First quarter | $ | 185 | 6,473 | 437,054 | 432,691 | $ | 0.13 | ||||||||||
Second quarter | 195 | 7,280 | 432,691 | 425,752 | 0.13 |
(a) | Includes shares of common stock withheld to cover income taxes owed by participants in our share-based incentive plans. |
(b) | On July 13, 2018, the Ally Board of Directors (the Board) declared a quarterly cash dividend of $0.15 per share on all common stock, payable on August 15, 2018. Refer to Note 25 for further information regarding this common stock dividend. |
June 30, 2018 | December 31, 2017 | |||||||||||||||||||||||
Derivative contracts in a | Notional amount | Derivative contracts in a | Notional amount | |||||||||||||||||||||
($ in millions) | receivable position | payable position | receivable position | payable position | ||||||||||||||||||||
Derivatives designated as accounting hedges | ||||||||||||||||||||||||
Interest rate contracts | ||||||||||||||||||||||||
Swaps | $ | — | $ | — | $ | 28,840 | $ | — | $ | — | $ | 6,915 | ||||||||||||
Foreign exchange contracts | ||||||||||||||||||||||||
Forwards | — | 1 | 145 | — | 1 | 136 | ||||||||||||||||||
Total derivatives designated as accounting hedges | — | 1 | 28,985 | — | 1 | 7,051 | ||||||||||||||||||
Derivatives not designated as accounting hedges | ||||||||||||||||||||||||
Interest rate contracts | ||||||||||||||||||||||||
Futures and forwards | — | — | 9 | — | — | 23 | ||||||||||||||||||
Written options | 1 | 62 | 6,760 | 1 | 39 | 8,327 | ||||||||||||||||||
Purchased options | 62 | — | 6,694 | 38 | — | 8,237 | ||||||||||||||||||
Total interest rate risk | 63 | 62 | 13,463 | 39 | 39 | 16,587 | ||||||||||||||||||
Foreign exchange contracts | ||||||||||||||||||||||||
Futures and forwards | — | 1 | 193 | — | 1 | 124 | ||||||||||||||||||
Total foreign exchange risk | — | 1 | 193 | — | 1 | 124 | ||||||||||||||||||
Equity contracts | ||||||||||||||||||||||||
Written options | — | 1 | — | — | — | — | ||||||||||||||||||
Total equity risk | — | 1 | — | — | — | — | ||||||||||||||||||
Total derivatives not designated as accounting hedges | 63 | 64 | 13,656 | 39 | 40 | 16,711 | ||||||||||||||||||
Total derivatives | $ | 63 | $ | 65 | $ | 42,641 | $ | 39 | $ | 41 | $ | 23,762 |
($ in millions) | Carrying amount of the hedged items | Cumulative amount of fair value hedging adjustment included in the carrying amount of the hedged items | ||||||||||||||||||||||
Total | Discontinued (a) | |||||||||||||||||||||||
June 30, 2018 | December 31, 2017 | June 30, 2018 | December 31, 2017 | June 30, 2018 | December 31, 2017 | |||||||||||||||||||
Assets | ||||||||||||||||||||||||
Available-for-sale securities (b) | $ | 1,435 | $ | 173 | $ | (3 | ) | $ | 2 | $ | (2 | ) | $ | 2 | ||||||||||
Finance receivables and loans, net (c) | 41,383 | 2,305 | (40 | ) | 18 | 11 | 19 | |||||||||||||||||
Liabilities | ||||||||||||||||||||||||
Long-term debt | $ | 14,959 | $ | 14,640 | $ | 99 | $ | 208 | $ | 95 | $ | 235 |
(a) | Represents the fair value hedging adjustment on qualifying hedges for which the hedging relationship was discontinued. This represents a subset of the amounts reported in the total hedging adjustment. |
(b) | The carrying amount of hedged available-for-sale securities is presented above using amortized cost. Refer to Note 6 for a reconciliation of the amortized cost and fair value of available-for-sale securities. |
(c) | The hedged item represents the carrying value of the hedged portfolio of assets. The amount that is identified as the last of layer in the hedge relationship is $17.7 billion as of June 30, 2018. The basis adjustment associated with the last-of-layer relationship is a $51 million liability as of June 30, 2018, which would be allocated across the entire remaining closed pool upon termination or maturity of the hedge relationship. A last-of-layer hedge strategy did not exist at December 31, 2017. |
Three months ended June 30, | Six months ended June 30, | |||||||||||||||
($ in millions) | 2018 | 2017 | 2018 | 2017 | ||||||||||||
Gain (loss) recognized in earnings | ||||||||||||||||
Interest rate contracts | ||||||||||||||||
Gain on mortgage and automotive loans, net | $ | — | $ | 1 | $ | — | $ | 1 | ||||||||
Other income, net of losses | (2 | ) | (1 | ) | — | (3 | ) | |||||||||
Total interest rate contracts | (2 | ) | — | — | (2 | ) | ||||||||||
Foreign exchange contracts | ||||||||||||||||
Other income, net of losses | 6 | (3 | ) | 6 | (4 | ) | ||||||||||
Total foreign exchange contracts | 6 | (3 | ) | 6 | (4 | ) | ||||||||||
Gain (loss) recognized in earnings | $ | 4 | $ | (3 | ) | $ | 6 | $ | (6 | ) |
Interest and fees on finance receivables and loans | Interest and dividends on investment securities and other earning assets | Interest on long-term debt | |||||||||||||||||||||
Three months ended June 30, ($ in millions) | 2018 | 2017 | 2018 | 2017 | 2018 | 2017 | |||||||||||||||||
Gain (loss) on fair value hedging relationships | |||||||||||||||||||||||
Interest rate contracts | |||||||||||||||||||||||
Hedged fixed-rate unsecured debt | $ | — | $ | — | $ | — | $ | — | $ | 8 | $ | (21 | ) | ||||||||||
Derivatives designated as hedging instruments on fixed-rate unsecured debt | — | — | — | — | (8 | ) | 21 | ||||||||||||||||
Hedged fixed-rate FHLB advances | — | — | — | — | 10 | 1 | |||||||||||||||||
Derivatives designated as hedging instruments on fixed-rate FHLB advances | — | — | — | — | (10 | ) | (1 | ) | |||||||||||||||
Hedged available-for-sale securities | — | — | (2 | ) | 2 | — | — | ||||||||||||||||
Derivatives designated as hedging instruments on available-for-sale securities | — | — | 2 | (2 | ) | — | — | ||||||||||||||||
Hedged fixed-rate retail automotive loans | (6 | ) | 1 | — | — | — | — | ||||||||||||||||
Derivatives designated as hedging instruments on fixed-rate retail automotive loans | 6 | (1 | ) | — | — | — | — | ||||||||||||||||
Total loss on fair value hedging relationships | $ | — | $ | — | $ | — | $ | — | $ | — | $ | — | |||||||||||
Total amounts presented in the Condensed Consolidated Statement of Comprehensive Income | $ | 1,647 | $ | 1,447 | $ | 188 | $ | 146 | $ | 434 | $ | 417 |
Interest and fees on finance receivables and loans | Interest and dividends on investment securities and other earning assets | Interest on long-term debt | |||||||||||||||||||||
Six months ended June 30, ($ in millions) | 2018 | 2017 | 2018 | 2017 | 2018 | 2017 | |||||||||||||||||
Gain (loss) on fair value hedging relationships | |||||||||||||||||||||||
Interest rate contracts | |||||||||||||||||||||||
Hedged fixed-rate unsecured debt | $ | — | $ | — | $ | — | $ | — | $ | 44 | $ | (23 | ) | ||||||||||
Derivatives designated as hedging instruments on fixed-rate unsecured debt | — | — | — | — | (43 | ) | 24 | ||||||||||||||||
Hedged fixed-rate FHLB advances | — | — | — | — | 43 | — | |||||||||||||||||
Derivatives designated as hedging instruments on fixed-rate FHLB advances | — | — | — | — | (43 | ) | — | ||||||||||||||||
Hedged available-for-sale securities | — | — | (5 | ) | 2 | — | — | ||||||||||||||||
Derivatives designated as hedging instruments on available-for-sale securities | — | — | 5 | (2 | ) | — | — | ||||||||||||||||
Hedged fixed-rate retail automotive loans | (51 | ) | (3 | ) | — | — | — | — | |||||||||||||||
Derivatives designated as hedging instruments on fixed-rate retail automotive loans | 51 | 1 | — | — | — | — | |||||||||||||||||
Total (loss) gain on fair value hedging relationships | $ | — | $ | (2 | ) | $ | — | $ | — | $ | 1 | $ | 1 | ||||||||||
Total amounts presented in the Condensed Consolidated Statement of Comprehensive Income | $ | 3,190 | $ | 2,815 | $ | 364 | $ | 280 | $ | 845 | $ | 841 |
Interest and fees on finance receivables and loans | Interest on long-term debt | ||||||||||||||
Three months ended June 30, ($ in millions) | 2018 | 2017 | 2018 | 2017 | |||||||||||
Gain (loss) on fair value hedging relationships | |||||||||||||||
Interest rate contracts | |||||||||||||||
Amortization of deferred unsecured debt basis adjustments | $ | — | $ | — | $ | 14 | $ | 20 | |||||||
Interest for qualifying accounting hedges of unsecured debt | — | — | 1 | 7 | |||||||||||
Amortization of deferred secured debt basis adjustments (FHLB advances) | — | — | (5 | ) | — | ||||||||||
Interest for qualifying accounting hedges of secured debt (FHLB advances) | — | — | 2 | — | |||||||||||
Amortization of deferred loan basis adjustments | (4 | ) | (6 | ) | — | — | |||||||||
Interest for qualifying accounting hedges of retail automotive loans held-for-investment | 5 | — | — | — | |||||||||||
Total (loss) gain on fair value hedging relationships | 1 | (6 | ) | 12 | 27 | ||||||||||
Gain on cash flow hedging relationships | |||||||||||||||
Interest rate contracts | |||||||||||||||
Interest for qualifying accounting hedges of variable-rate borrowings | — | — | 2 | — | |||||||||||
Total gain on cash flow hedging relationships | $ | — | $ | — | $ | 2 | $ | — |
Interest and fees on finance receivables and loans | Interest and dividends on investment securities and other earning assets | Interest on long-term debt | |||||||||||||||||||||
Six months ended June 30, ($ in millions) | 2018 | 2017 | 2018 | 2017 | 2018 | 2017 | |||||||||||||||||
Gain (loss) on fair value hedging relationships | |||||||||||||||||||||||
Interest rate contracts | |||||||||||||||||||||||
Amortization of deferred unsecured debt basis adjustments | $ | — | $ | — | $ | — | $ | — | $ | 29 | $ | 40 | |||||||||||
Interest for qualifying accounting hedges of unsecured debt | — | — | — | — | 4 | 12 | |||||||||||||||||
Amortization of deferred secured debt basis adjustments (FHLB advances) | — | — | — | — | (6 | ) | (1 | ) | |||||||||||||||
Interest for qualifying accounting hedges of secured debt (FHLB advances) | — | — | — | — | 4 | — | |||||||||||||||||
Interest for qualifying accounting hedges of available-for-sale securities | — | — | (1 | ) | — | — | — | ||||||||||||||||
Amortization of deferred loan basis adjustments | (8 | ) | (11 | ) | — | — | — | — | |||||||||||||||
Interest for qualifying accounting hedges of retail automotive loans held-for-investment | (2 | ) | (1 | ) | — | — | — | — | |||||||||||||||
Total (loss) gain on fair value hedging relationships | (10 | ) | (12 | ) | (1 | ) | — | 31 | 51 | ||||||||||||||
Gain on cash flow hedging relationships | |||||||||||||||||||||||
Interest rate contracts | |||||||||||||||||||||||
Interest for qualifying accounting hedges of variable-rate borrowings | — | — | — | — | 3 | — | |||||||||||||||||
Total gain on cash flow hedging relationships | $ | — | $ | — | $ | — | $ | — | $ | 3 | $ | — |
Three months ended June 30, | Six months ended June 30, | ||||||||||||||
($ in millions) | 2018 | 2017 | 2018 | 2017 | |||||||||||
Interest rate contracts | |||||||||||||||
Gain recognized in other comprehensive loss | $ | 5 | $ | 1 | $ | 23 | $ | 1 |
Three months ended June 30, | Six months ended June 30, | ||||||||||||||
($ in millions) | 2018 | 2017 | 2018 | 2017 | |||||||||||
Foreign exchange contracts (a) (b) | |||||||||||||||
Gain (loss) recognized in other comprehensive loss | $ | 3 | $ | (4 | ) | $ | 7 | $ | (6 | ) |
(a) | There were no amounts excluded from effectiveness testing for the three months and six months ended June 30, 2018, or 2017. |
(b) | Gains and losses reclassified from accumulated other comprehensive loss are reported as other income, net of losses, in the Condensed Consolidated Statement of Comprehensive Income. There were no amounts reclassified for the three months and six months ended June 30, 2018, or 2017. |
Level 1 | Inputs are quoted prices in active markets for identical assets or liabilities at the measurement date. Additionally, the entity must have the ability to access the active market, and the quoted prices cannot be adjusted by the entity. |
Level 2 | Inputs are other than quoted prices included in Level 1 that are observable for the asset or liability, either directly or indirectly. Level 2 inputs include quoted prices in active markets for similar assets or liabilities; quoted prices in inactive markets for identical or similar assets or liabilities; or inputs that are observable or can be corroborated by observable market data by correlation or other means for substantially the full term of the assets or liabilities. |
Level 3 | Unobservable inputs are supported by little or no market activity. The unobservable inputs represent management’s best assumptions of how market participants would price the assets or liabilities. Generally, Level 3 assets and liabilities are |
Transfers | Transfers into or out of any hierarchy level are recognized at the end of the reporting period in which the transfer occurred. There were no transfers between any levels for the six months ended June 30, 2018. |
• | Equity Securities — Includes various marketable equity securities measured at fair value with changes in fair value recognized in net income. Measurements based on observable market prices are classified as Level 1. |
• | Available-for-sale securities — All classes of available-for-sale securities are carried at fair value based on observable market prices, when available. If observable market prices are not available, our valuations are based on internally developed discounted cash flow models (an income approach) that use a market-based discount rate and consider recent market transactions, experience with similar securities, current business conditions, and analysis of the underlying collateral, as available. To estimate cash flows, we are required to utilize various significant assumptions including market observable inputs (e.g., forward interest rates) and internally developed inputs (including prepayment speeds, delinquency levels, and credit losses). |
• | Interests retained in financial asset sales — Includes certain noncertificated interests retained from the sale of automotive finance receivables. Due to inactivity in the market, valuations are based on internally developed discounted cash flow models (an income approach) that use a market-based discount rate; therefore, we classified these assets as Level 3. The valuation considers recent market transactions, experience with similar assets, current business conditions, and analysis of the underlying collateral, as available. To estimate cash flows, we utilize various significant assumptions, including market observable inputs (e.g., forward interest rates) and internally developed inputs (e.g., prepayment speeds, delinquency levels, and credit losses). |
• | Derivative instruments — We enter into a variety of derivative financial instruments as part of our risk management strategies. Certain of these derivatives are exchange traded, such as Eurodollar futures, options of Eurodollar futures, and equity options. To determine the fair value of these instruments, we utilize the quoted market prices for the particular derivative contracts; therefore, we classified these contracts as Level 1. |
Recurring fair value measurements | ||||||||||||||||
June 30, 2018 ($ in millions) | Level 1 | Level 2 | Level 3 | Total | ||||||||||||
Assets | ||||||||||||||||
Investment securities | ||||||||||||||||
Equity securities (a) | $ | 509 | $ | — | $ | 12 | $ | 521 | ||||||||
Available-for-sale securities | ||||||||||||||||
Debt securities | ||||||||||||||||
U.S. Treasury | 1,874 | — | — | 1,874 | ||||||||||||
U.S. States and political subdivisions | — | 851 | — | 851 | ||||||||||||
Foreign government | 7 | 147 | — | 154 | ||||||||||||
Agency mortgage-backed residential | — | 15,066 | — | 15,066 | ||||||||||||
Mortgage-backed residential | — | 2,625 | — | 2,625 | ||||||||||||
Mortgage-backed commercial | — | 642 | — | 642 | ||||||||||||
Asset-backed | — | 868 | — | 868 | ||||||||||||
Corporate debt | — | 1,216 | — | 1,216 | ||||||||||||
Total available-for-sale securities | 1,881 | 21,415 | — | 23,296 | ||||||||||||
Mortgage loans held-for-sale (b) | — | — | 13 | 13 | ||||||||||||
Interests retained in financial asset sales | — | — | 4 | 4 | ||||||||||||
Derivative contracts in a receivable position | ||||||||||||||||
Interest rate | — | 62 | 1 | 63 | ||||||||||||
Total derivative contracts in a receivable position | — | 62 | 1 | 63 | ||||||||||||
Total assets | $ | 2,390 | $ | 21,477 | $ | 30 | $ | 23,897 | ||||||||
Liabilities | ||||||||||||||||
Accrued expenses and other liabilities | ||||||||||||||||
Derivative contracts in a payable position | ||||||||||||||||
Interest rate | $ | — | $ | 62 | $ | — | $ | 62 | ||||||||
Foreign currency | — | 2 | — | 2 | ||||||||||||
Other | 1 | — | — | 1 | ||||||||||||
Total derivative contracts in a payable position | 1 | 64 | — | 65 | ||||||||||||
Total liabilities | $ | 1 | $ | 64 | $ | — | $ | 65 |
(a) | Our investment in any one industry did not exceed 15%. |
(b) | Carried at fair value due to fair value option elections. |
Recurring fair value measurements | ||||||||||||||||
December 31, 2017 ($ in millions) | Level 1 | Level 2 | Level 3 | Total | ||||||||||||
Assets | ||||||||||||||||
Investment securities | ||||||||||||||||
Equity securities (a) | $ | 518 | $ | — | $ | — | $ | 518 | ||||||||
Available-for-sale securities | ||||||||||||||||
Debt securities | ||||||||||||||||
U.S. Treasury | 1,777 | — | — | 1,777 | ||||||||||||
U.S. States and political subdivisions | — | 854 | — | 854 | ||||||||||||
Foreign government | 8 | 146 | — | 154 | ||||||||||||
Agency mortgage-backed residential | — | 14,291 | — | 14,291 | ||||||||||||
Mortgage-backed residential | — | 2,494 | — | 2,494 | ||||||||||||
Mortgage-backed commercial | — | 541 | — | 541 | ||||||||||||
Asset-backed | — | 936 | — | 936 | ||||||||||||
Corporate debt | — | 1,256 | — | 1,256 | ||||||||||||
Total available-for-sale securities | 1,785 | 20,518 | — | 22,303 | ||||||||||||
Mortgage loans held-for-sale (b) | — | — | 13 | 13 | ||||||||||||
Interests retained in financial asset sales | — | — | 5 | 5 | ||||||||||||
Derivative contracts in a receivable position | ||||||||||||||||
Interest rate | — | 38 | 1 | 39 | ||||||||||||
Total derivative contracts in a receivable position | — | 38 | 1 | 39 | ||||||||||||
Total assets | $ | 2,303 | $ | 20,556 | $ | 19 | $ | 22,878 | ||||||||
Liabilities | ||||||||||||||||
Accrued expenses and other liabilities | ||||||||||||||||
Derivative contracts in a payable position | ||||||||||||||||
Interest rate | $ | — | $ | 39 | $ | — | $ | 39 | ||||||||
Foreign currency | — | 2 | — | 2 | ||||||||||||
Total derivative contracts in a payable position | — | 41 | — | 41 | ||||||||||||
Total liabilities | $ | — | $ | 41 | $ | — | $ | 41 |
(a) | Our investment in any one industry did not exceed 14%. |
(b) | Carried at fair value due to fair value option elections. |
Level 3 recurring fair value measurements | ||||||||||||||||||||||||||||
Net realized/unrealized gains | Fair value at June 30, 2018 | Net unrealized gains included in earnings still held at June 30, 2018 | ||||||||||||||||||||||||||
($ in millions) | Fair value at April 1, 2018 | included in earnings | included in OCI | Purchases | Sales | Issuances | Settlements | |||||||||||||||||||||
Assets | ||||||||||||||||||||||||||||
Equity securities | $ | 12 | $ | — | $ | — | $ | — | $ | — | $ | — | $ | — | $ | 12 | $ | — | ||||||||||
Mortgage loans held-for-sale (a) | 7 | 1 | (b) | — | 73 | (68 | ) | — | — | 13 | — | |||||||||||||||||
Other assets | ||||||||||||||||||||||||||||
Interests retained in financial asset sales | 5 | — | — | — | — | — | (1 | ) | 4 | — | ||||||||||||||||||
Derivative assets | 1 | — | — | — | — | — | — | 1 | — | |||||||||||||||||||
Total assets | $ | 25 | $ | 1 | $ | — | $ | 73 | $ | (68 | ) | $ | — | $ | (1 | ) | $ | 30 | $ | — |
(a) | Carried at fair value due to fair value option elections. |
(b) | Reported as gain on mortgage and automotive loans, net, in the Condensed Consolidated Statement of Comprehensive Income. |
Level 3 recurring fair value measurements | ||||||||||||||||||||||||||||
Fair value at April 1, 2017 | Net realized/unrealized gains | Purchases | Sales | Issuances | Settlements | Fair value at June 30, 2017 | Net unrealized gains included in earnings still held at June 30, 2017 | |||||||||||||||||||||
($ in millions) | included in earnings | included in OCI | ||||||||||||||||||||||||||
Assets | ||||||||||||||||||||||||||||
Mortgage loans held-for-sale (a) | $ | 1 | $ | — | $ | — | $ | 20 | $ | (18 | ) | $ | — | $ | — | $ | 3 | $ | — | |||||||||
Other assets | ||||||||||||||||||||||||||||
Interests retained in financial asset sales | 31 | 1 | (b) | — | — | 4 | — | (31 | ) | 5 | — | |||||||||||||||||
Derivative assets | — | 1 | (c) | — | — | — | — | — | 1 | 1 | ||||||||||||||||||
Total assets | $ | 32 | $ | 2 | $ | — | $ | 20 | $ | (14 | ) | $ | — | $ | (31 | ) | $ | 9 | $ | 1 |
(a) | Carried at fair value due to fair value option elections. |
(b) | Reported as other income, net of losses, in the Condensed Consolidated Statement of Comprehensive Income. |
(c) | Reported as gain on mortgage and automotive loans, net, in the Condensed Consolidated Statement of Comprehensive Income. |
Level 3 recurring fair value measurements | ||||||||||||||||||||||||||||
Net realized/unrealized (losses) gains | Fair value at June 30, 2018 | Net unrealized losses included in earnings still held at June 30, 2018 | ||||||||||||||||||||||||||
($ in millions) | Fair value at Jan. 1, 2018 | included in earnings | included in OCI | Purchases | Sales | Issuances | Settlements | |||||||||||||||||||||
Assets | ||||||||||||||||||||||||||||
Equity securities (a) | $ | 19 | $ | (4 | ) | (b) | $ | — | $ | — | $ | — | $ | — | $ | (3 | ) | $ | 12 | $ | (5 | ) | ||||||
Mortgage loans held-for-sale (c) | 13 | 2 | (d) | — | 132 | (134 | ) | — | — | 13 | — | |||||||||||||||||
Other assets | ||||||||||||||||||||||||||||
Interests retained in financial asset sales | 5 | — | — | — | — | — | (1 | ) | 4 | — | ||||||||||||||||||
Derivative assets | 1 | — | — | — | — | — | — | 1 | — | |||||||||||||||||||
Total assets | $ | 38 | $ | (2 | ) | $ | — | $ | 132 | $ | (134 | ) | $ | — | $ | (4 | ) | $ | 30 | $ | (5 | ) |
(a) | In connection with our adoption of ASU 2016-01 on January 1, 2018, certain of our equity securities previously measured using the cost method of accounting are now measured at fair value on a recurring basis, and have been categorized as Level 3 within the fair value hierarchy. Accordingly, the fair value of such investments has been included in the opening balance of the reconciliation above. |
(b) | Reported as other loss on investments, net, in the Condensed Consolidated Statement of Comprehensive Income. |
(c) | Carried at fair value due to fair value option elections. |
(d) | Reported as gain on mortgage and automotive loans, net, in the Condensed Consolidated Statement of Comprehensive Income. |
Level 3 recurring fair value measurements | ||||||||||||||||||||||||||||
Fair value at Jan. 1, 2017 | Net realized/unrealized gains | Purchases | Sales | Issuances | Settlements | Fair value at June 30, 2017 | Net unrealized gains included in earnings still held at June 30, 2017 | |||||||||||||||||||||
($ in millions) | included in earnings | included in OCI | ||||||||||||||||||||||||||
Assets | ||||||||||||||||||||||||||||
Mortgage loans held-for-sale (a) | $ | — | $ | — | $ | — | $ | 23 | $ | (20 | ) | $ | — | $ | — | $ | 3 | $ | — | |||||||||
Other assets | ||||||||||||||||||||||||||||
Interests retained in financial asset sales | 29 | 1 | (b) | — | — | 8 | — | (33 | ) | 5 | — | |||||||||||||||||
Derivative assets | — | 1 | (c) | — | — | — | — | — | 1 | 1 | ||||||||||||||||||
Total assets | $ | 29 | $ | 2 | $ | — | $ | 23 | $ | (12 | ) | $ | — | $ | (33 | ) | $ | 9 | $ | 1 |
(a) | Carried at fair value due to fair value option elections. |
(b) | Reported as other income, net of losses, in the Condensed Consolidated Statement of Comprehensive Income. |
(c) | Reported as gain on mortgage and automotive loans, net, in the Condensed Consolidated Statement of Comprehensive Income. |
Nonrecurring fair value measurements | Lower-of-cost or fair value or valuation reserve allowance | Total gain (loss) included in earnings | |||||||||||||||||||||
June 30, 2018 ($ in millions) | Level 1 | Level 2 | Level 3 | Total | |||||||||||||||||||
Assets | |||||||||||||||||||||||
Loans held-for-sale, net | $ | — | $ | — | $ | 315 | $ | 315 | $ | — | n/m | (a) | |||||||||||
Commercial finance receivables and loans, net (b) | |||||||||||||||||||||||
Automotive | — | — | 62 | 62 | (12 | ) | n/m | (a) | |||||||||||||||
Other | — | — | 50 | 50 | (15 | ) | n/m | (a) | |||||||||||||||
Total commercial finance receivables and loans, net | — | — | 112 | 112 | (27 | ) | n/m | (a) | |||||||||||||||
Other assets | |||||||||||||||||||||||
Repossessed and foreclosed assets (c) | — | — | 13 | 13 | (1 | ) | n/m | (a) | |||||||||||||||
Total assets | $ | — | $ | — | $ | 440 | $ | 440 | $ | (28 | ) | n/m |
(a) | We consider the applicable valuation or loan loss allowance to be the most relevant indicator of the impact on earnings caused by the fair value measurement. Accordingly, the table above excludes total gains and losses included in earnings for these items. The carrying values are inclusive of the respective valuation or loan loss allowance. |
(b) | Represents the portion of the portfolio specifically impaired during 2018. The related valuation allowance represents the cumulative adjustment to fair value of those specific receivables. |
(c) | The allowance provided for repossessed and foreclosed assets represents any cumulative valuation adjustment recognized to adjust the assets to fair value. |
Nonrecurring fair value measurements | Lower-of-cost or fair value or valuation reserve allowance | Total gain (loss) included in earnings | |||||||||||||||||||||
December 31, 2017 ($ in millions) | Level 1 | Level 2 | Level 3 | Total | |||||||||||||||||||
Assets | |||||||||||||||||||||||
Loans held-for-sale, net | $ | — | $ | — | $ | 77 | $ | 77 | $ | — | n/m | (a) | |||||||||||
Commercial finance receivables and loans, net (b) | |||||||||||||||||||||||
Automotive | — | — | 20 | 20 | (3 | ) | n/m | (a) | |||||||||||||||
Other | — | — | 22 | 22 | (12 | ) | n/m | (a) | |||||||||||||||
Total commercial finance receivables and loans, net | — | — | 42 | 42 | (15 | ) | n/m | (a) | |||||||||||||||
Other assets | |||||||||||||||||||||||
Repossessed and foreclosed assets (c) | — | — | 14 | 14 | (1 | ) | n/m | (a) | |||||||||||||||
Other | — | — | 3 | 3 | — | n/m | (a) | ||||||||||||||||
Total assets | $ | — | $ | — | $ | 136 | $ | 136 | $ | (16 | ) | n/m |
(a) | We consider the applicable valuation or loan loss allowance to be the most relevant indicator of the impact on earnings caused by the fair value measurement. Accordingly, the table above excludes total gains and losses included in earnings for these items. The carrying values are inclusive of the respective valuation or loan loss allowance. |
(b) | Represents the portion of the portfolio specifically impaired during 2017. The related valuation allowance represents the cumulative adjustment to fair value of those specific receivables. |
(c) | The allowance provided for repossessed and foreclosed assets represents any cumulative valuation adjustment recognized to adjust the assets to fair value. |
Estimated fair value | |||||||||||||||||||
($ in millions) | Carrying value | Level 1 | Level 2 | Level 3 | Total | ||||||||||||||
June 30, 2018 | |||||||||||||||||||
Financial assets | |||||||||||||||||||
Held-to-maturity securities | $ | 2,089 | $ | — | $ | 2,007 | $ | — | $ | 2,007 | |||||||||
Loans held-for-sale, net | 315 | — | — | 315 | 315 | ||||||||||||||
Finance receivables and loans, net | 124,287 | — | — | 125,846 | 125,846 | ||||||||||||||
Nonmarketable equity investments | 1,237 | — | 1,237 | — | 1,237 | ||||||||||||||
Financial liabilities | |||||||||||||||||||
Deposit liabilities (a) | $ | 49,617 | $ | — | $ | — | $ | 49,493 | $ | 49,493 | |||||||||
Short-term borrowings | 7,108 | — | — | 7,112 | 7,112 | ||||||||||||||
Long-term debt | 47,328 | — | 28,040 | 21,094 | 49,134 | ||||||||||||||
December 31, 2017 | |||||||||||||||||||
Financial assets | |||||||||||||||||||
Held-to-maturity securities | $ | 1,899 | $ | — | $ | 1,865 | $ | — | $ | 1,865 | |||||||||
Loans held-for-sale, net | 95 | — | — | 95 | 95 | ||||||||||||||
Finance receivables and loans, net | 121,617 | — | — | 123,302 | 123,302 | ||||||||||||||
Nonmarketable equity investments | 1,233 | — | 1,190 | 49 | 1,239 | ||||||||||||||
Financial liabilities | |||||||||||||||||||
Deposit liabilities (a) | $ | 45,869 | $ | — | $ | — | $ | 45,827 | $ | 45,827 | |||||||||
Short-term borrowings | 11,413 | — | — | 11,417 | 11,417 | ||||||||||||||
Long-term debt | 44,226 | — | 27,807 | 18,817 | 46,624 |
(a) | In connection with our adoption of ASU 2016-01 on January 1, 2018, deposit liabilities with no defined or contractual maturities are no longer included in the table above. Amounts for December 31, 2017, have been adjusted to conform to the current presentation and exclude $47.4 billion and $45.2 billion of deposit liabilities with no defined or contractual maturities from the carrying value and Level 3 fair value, respectively. Refer to Note 12 for information regarding the composition of our deposits portfolio, and Note 1 for further information regarding recently adopted accounting standards. |
Gross amounts of recognized assets/liabilities | Gross amounts offset on the Condensed Consolidated Balance Sheet | Net amounts of assets/liabilities presented on the Condensed Consolidated Balance Sheet | ||||||||||||||||||||||
Gross amounts not offset on the Condensed Consolidated Balance Sheet | ||||||||||||||||||||||||
June 30, 2018 ($ in millions) | Financial instruments | Collateral (a) (b) (c) | Net amount | |||||||||||||||||||||
Assets | ||||||||||||||||||||||||
Derivative assets in net asset positions | $ | 62 | $ | — | $ | 62 | $ | — | $ | — | $ | 62 | ||||||||||||
Derivative assets with no offsetting arrangements | 1 | — | 1 | — | — | 1 | ||||||||||||||||||
Total assets (d) | $ | 63 | $ | — | $ | 63 | $ | — | $ | — | $ | 63 | ||||||||||||
Liabilities | ||||||||||||||||||||||||
Derivative liabilities in net liability positions (d) | $ | 65 | $ | — | $ | 65 | $ | — | $ | (1 | ) | $ | 64 | |||||||||||
Securities sold under agreements to repurchase (e) | 967 | — | 967 | — | (967 | ) | — | |||||||||||||||||
Total liabilities | $ | 1,032 | $ | — | $ | 1,032 | $ | — | $ | (968 | ) | $ | 64 |
(a) | Financial collateral received/pledged shown as a balance based on the sum of all net asset and liability positions between Ally and each individual derivative counterparty. |
(b) | Amounts disclosed are limited to the financial asset or liability balance and, accordingly, exclude excess collateral received or pledged and noncash collateral received. $11 million of noncash derivative collateral pledged to us was excluded at June 30, 2018. We do not record such collateral received on our Condensed Consolidated Balance Sheet unless certain conditions are met. |
(c) | Certain agreements grant us the right to sell or pledge the noncash assets we receive as collateral. Noncash collateral pledged to us where the agreement grants us the right to sell or pledge the underlying assets had a fair value of $11 million at June 30, 2018. We have not sold or pledged any of the noncash collateral received under these agreements as of June 30, 2018. |
(d) | For additional information on derivative instruments and hedging activities, refer to Note 18. |
(e) | For additional information on securities sold under agreements to repurchase, refer to Note 13. |
Gross amounts of recognized assets/liabilities | Gross amounts offset on the Condensed Consolidated Balance Sheet | Net amounts of assets/liabilities presented on the Condensed Consolidated Balance Sheet | ||||||||||||||||||||||
Gross amounts not offset on the Condensed Consolidated Balance Sheet | ||||||||||||||||||||||||
December 31, 2017 ($ in millions) | Financial instruments | Collateral (a) (b) (c) | Net amount | |||||||||||||||||||||
Assets | ||||||||||||||||||||||||
Derivative assets in net asset positions | $ | 38 | $ | — | $ | 38 | $ | — | $ | — | $ | 38 | ||||||||||||
Derivative assets with no offsetting arrangements | 1 | — | 1 | — | — | 1 | ||||||||||||||||||
Total assets (d) | $ | 39 | $ | — | $ | 39 | $ | — | $ | — | $ | 39 | ||||||||||||
Liabilities | ||||||||||||||||||||||||
Derivative liabilities in net liability positions (d) | $ | 41 | $ | — | $ | 41 | $ | — | $ | (1 | ) | $ | 40 | |||||||||||
Securities sold under agreements to repurchase (e) | 892 | — | 892 | — | (892 | ) | — | |||||||||||||||||
Total liabilities | $ | 933 | $ | — | $ | 933 | $ | — | $ | (893 | ) | $ | 40 |
(a) | Financial collateral received/pledged shown as a balance based on the sum of all net asset and liability positions between Ally and each individual derivative counterparty. |
(b) | Amounts disclosed are limited to the financial asset or liability balance and, accordingly, exclude excess collateral received or pledged and noncash collateral received. $2 million of noncash derivative collateral pledged to us was excluded at December 31, 2017. We do not record such collateral received on our Condensed Consolidated Balance Sheet unless certain conditions are met. |
(c) | Certain agreements grant us the right to sell or pledge the noncash assets we receive as collateral. Noncash collateral pledged to us where the agreement grants us the right to sell or pledge the underlying assets had a fair value of $2 million at December 31, 2017. We have not sold or pledged any of the noncash collateral received under these agreements as of December 31, 2017. |
(d) | For additional information on derivative instruments and hedging activities, refer to Note 18. |
(e) | For additional information on securities sold under agreements to repurchase, refer to Note 13. |
Three months ended June 30, ($ in millions) | Automotive Finance operations | Insurance operations | Mortgage Finance operations | Corporate Finance operations | Corporate and Other | Consolidated (a) | ||||||||||||||||||
2018 | ||||||||||||||||||||||||
Net financing revenue and other interest income | $ | 925 | $ | 13 | $ | 44 | $ | 57 | $ | 55 | $ | 1,094 | ||||||||||||
Other revenue | 63 | 266 | 2 | 14 | 19 | 364 | ||||||||||||||||||
Total net revenue | 988 | 279 | 46 | 71 | 74 | 1,458 | ||||||||||||||||||
Provision for loan losses | 170 | — | — | (6 | ) | (6 | ) | 158 | ||||||||||||||||
Total noninterest expense | 436 | 268 | 32 | 19 | 84 | 839 | ||||||||||||||||||
Income (loss) from continuing operations before income tax expense | $ | 382 | $ | 11 | $ | 14 | $ | 58 | $ | (4 | ) | $ | 461 | |||||||||||
Total assets | $ | 114,915 | $ | 7,634 | $ | 13,385 | $ | 4,458 | $ | 30,953 | $ | 171,345 | ||||||||||||
2017 | ||||||||||||||||||||||||
Net financing revenue and other interest income | $ | 932 | $ | 14 | $ | 32 | $ | 48 | $ | 41 | $ | 1,067 | ||||||||||||
Other revenue | 107 | 245 | 1 | 10 | 25 | 388 | ||||||||||||||||||
Total net revenue | 1,039 | 259 | 33 | 58 | 66 | 1,455 | ||||||||||||||||||
Provision for loan losses | 266 | — | 1 | 6 | (4 | ) | 269 | |||||||||||||||||
Total noninterest expense | 426 | 280 | 25 | 17 | 62 | 810 | ||||||||||||||||||
Income (loss) from continuing operations before income tax expense | $ | 347 | $ | (21 | ) | $ | 7 | $ | 35 | $ | 8 | $ | 376 | |||||||||||
Total assets | $ | 115,447 | $ | 7,308 | $ | 8,902 | $ | 3,552 | $ | 29,136 | $ | 164,345 |
(a) | Net financing revenue and other interest income after the provision for loan losses totaled $936 million and $798 million for the three months ended June 30, 2018, and 2017, respectively. |
Six months ended June 30, ($ in millions) | Automotive Finance operations | Insurance operations | Mortgage Finance operations | Corporate Finance operations | Corporate and Other | Consolidated (a) | ||||||||||||||||||
2018 | ||||||||||||||||||||||||
Net financing revenue and other interest income | $ | 1,834 | $ | 25 | $ | 87 | $ | 103 | $ | 94 | $ | 2,143 | ||||||||||||
Other revenue | 129 | 512 | 3 | 22 | 52 | 718 | ||||||||||||||||||
Total net revenue | 1,963 | 537 | 90 | 125 | 146 | 2,861 | ||||||||||||||||||
Provision for loan losses | 429 | — | 2 | (6 | ) | (6 | ) | 419 | ||||||||||||||||
Total noninterest expense | 884 | 499 | 66 | 44 | 160 | 1,653 | ||||||||||||||||||
Income (loss) from continuing operations before income tax expense | $ | 650 | $ | 38 | $ | 22 | $ | 87 | $ | (8 | ) | $ | 789 | |||||||||||
Total assets | $ | 114,915 | $ | 7,634 | $ | 13,385 | $ | 4,458 | $ | 30,953 | $ | 171,345 | ||||||||||||
2017 | ||||||||||||||||||||||||
Net financing revenue and other interest income | $ | 1,824 | $ | 29 | $ | 66 | $ | 82 | $ | 45 | $ | 2,046 | ||||||||||||
Other revenue | 208 | 509 | 1 | 28 | 38 | 784 | ||||||||||||||||||
Total net revenue | 2,032 | 538 | 67 | 110 | 83 | 2,830 | ||||||||||||||||||
Provision for loan losses | 534 | — | 2 | 12 | (8 | ) | 540 | |||||||||||||||||
Total noninterest expense | 863 | 519 | 49 | 38 | 119 | 1,588 | ||||||||||||||||||
Income (loss) from continuing operations before income tax expense | $ | 635 | $ | 19 | $ | 16 | $ | 60 | $ | (28 | ) | $ | 702 | |||||||||||
Total assets | $ | 115,447 | $ | 7,308 | $ | 8,902 | $ | 3,552 | $ | 29,136 | $ | 164,345 |
(a) | Net financing revenue and other interest income after the provision for loan losses totaled $1.7 billion and $1.5 billion for the six months ended June 30, 2018, and 2017, respectively. |
Three months ended June 30, 2018 ($ in millions) | Parent | Guarantors | Nonguarantors | Consolidating adjustments | Ally consolidated | |||||||||||||||
Financing revenue and other interest income | ||||||||||||||||||||
Interest and fees on finance receivables and loans | $ | (1 | ) | $ | — | $ | 1,648 | $ | — | $ | 1,647 | |||||||||
Interest and fees on finance receivables and loans — intercompany | 4 | — | 1 | (5 | ) | — | ||||||||||||||
Interest on loans held-for-sale | — | — | 6 | — | 6 | |||||||||||||||
Interest and dividends on investment securities and other earning assets | — | — | 188 | — | 188 | |||||||||||||||
Interest on cash and cash equivalents | 2 | — | 14 | 1 | 17 | |||||||||||||||
Interest-bearing cash — intercompany | 2 | — | 2 | (4 | ) | — | ||||||||||||||
Operating leases | 1 | — | 373 | — | 374 | |||||||||||||||
Total financing revenue and other interest income | 8 | — | 2,232 | (8 | ) | 2,232 | ||||||||||||||
Interest expense | ||||||||||||||||||||
Interest on deposits | — | — | 395 | 4 | 399 | |||||||||||||||
Interest on short-term borrowings | 10 | — | 30 | — | 40 | |||||||||||||||
Interest on long-term debt | 257 | — | 177 | — | 434 | |||||||||||||||
Interest on intercompany debt | 4 | — | 8 | (12 | ) | — | ||||||||||||||
Total interest expense | 271 | — | 610 | (8 | ) | 873 | ||||||||||||||
Net depreciation expense on operating lease assets | 1 | — | 264 | — | 265 | |||||||||||||||
Net financing (loss) revenue | (264 | ) | — | 1,358 | — | 1,094 | ||||||||||||||
Cash dividends from subsidiaries | ||||||||||||||||||||
Bank subsidiary | 500 | 500 | — | (1,000 | ) | — | ||||||||||||||
Nonbank subsidiaries | 132 | — | — | (132 | ) | — | ||||||||||||||
Other revenue | ||||||||||||||||||||
Insurance premiums and service revenue earned | — | — | 239 | — | 239 | |||||||||||||||
Gain on mortgage and automotive loans, net | — | — | 1 | — | 1 | |||||||||||||||
Other gain on investments, net | — | — | 27 | — | 27 | |||||||||||||||
Other income, net of losses | 100 | — | 185 | (188 | ) | 97 | ||||||||||||||
Total other revenue | 100 | — | 452 | (188 | ) | 364 | ||||||||||||||
Total net revenue | 468 | 500 | 1,810 | (1,320 | ) | 1,458 | ||||||||||||||
Provision for loan losses | 32 | — | 126 | — | 158 | |||||||||||||||
Noninterest expense | ||||||||||||||||||||
Compensation and benefits expense | 25 | — | 267 | — | 292 | |||||||||||||||
Insurance losses and loss adjustment expenses | — | — | 101 | — | 101 | |||||||||||||||
Other operating expenses | 173 | — | 461 | (188 | ) | 446 | ||||||||||||||
Total noninterest expense | 198 | — | 829 | (188 | ) | 839 | ||||||||||||||
Income from continuing operations before income tax (benefit) expense and undistributed income (loss) of subsidiaries | 238 | 500 | 855 | (1,132 | ) | 461 | ||||||||||||||
Income tax (benefit) expense from continuing operations | (66 | ) | — | 179 | — | 113 | ||||||||||||||
Net income from continuing operations | 304 | 500 | 676 | (1,132 | ) | 348 | ||||||||||||||
(Loss) income from discontinued operations, net of tax | (1 | ) | — | 2 | — | 1 | ||||||||||||||
Undistributed income (loss) of subsidiaries | ||||||||||||||||||||
Bank subsidiary | 52 | 52 | — | (104 | ) | — | ||||||||||||||
Nonbank subsidiaries | (6 | ) | — | — | 6 | — | ||||||||||||||
Net income | 349 | 552 | 678 | (1,230 | ) | 349 | ||||||||||||||
Other comprehensive loss, net of tax | (70 | ) | (56 | ) | (74 | ) | 130 | (70 | ) | |||||||||||
Comprehensive income | $ | 279 | $ | 496 | $ | 604 | $ | (1,100 | ) | $ | 279 |
Three months ended June 30, 2017 ($ in millions) | Parent | Guarantors | Nonguarantors | Consolidating adjustments | Ally consolidated | |||||||||||||||
Financing (loss) revenue and other interest income | ||||||||||||||||||||
Interest and fees on finance receivables and loans | $ | (35 | ) | $ | — | $ | 1,482 | $ | — | $ | 1,447 | |||||||||
Interest and fees on finance receivables and loans — intercompany | 3 | — | 2 | (5 | ) | — | ||||||||||||||
Interest and dividends on investment securities and other earning assets | — | — | 146 | — | 146 | |||||||||||||||
Interest on cash and cash equivalents | 2 | — | 5 | — | 7 | |||||||||||||||
Interest-bearing cash — intercompany | — | — | 2 | (2 | ) | — | ||||||||||||||
Operating leases | 3 | — | 485 | — | 488 | |||||||||||||||
Total financing (loss) revenue and other interest income | (27 | ) | — | 2,122 | (7 | ) | 2,088 | |||||||||||||
Interest expense | ||||||||||||||||||||
Interest on deposits | 1 | — | 249 | — | 250 | |||||||||||||||
Interest on short-term borrowings | 19 | — | 14 | — | 33 | |||||||||||||||
Interest on long-term debt | 274 | — | 143 | — | 417 | |||||||||||||||
Interest on intercompany debt | 4 | — | 3 | (7 | ) | — | ||||||||||||||
Total interest expense | 298 | — | 409 | (7 | ) | 700 | ||||||||||||||
Net depreciation expense on operating lease assets | 3 | — | 318 | — | 321 | |||||||||||||||
Net financing (loss) revenue | (328 | ) | — | 1,395 | — | 1,067 | ||||||||||||||
Cash dividends from subsidiaries | ||||||||||||||||||||
Nonbank subsidiaries | 387 | — | — | (387 | ) | — | ||||||||||||||
Other revenue | ||||||||||||||||||||
Insurance premiums and service revenue earned | — | — | 227 | — | 227 | |||||||||||||||
Gain on mortgage and automotive loans, net | 32 | — | 4 | — | 36 | |||||||||||||||
Other gain on investments, net | — | — | 23 | — | 23 | |||||||||||||||
Other income, net of losses | 163 | — | 210 | (271 | ) | 102 | ||||||||||||||
Total other revenue | 195 | — | 464 | (271 | ) | 388 | ||||||||||||||
Total net revenue | 254 | — | 1,859 | (658 | ) | 1,455 | ||||||||||||||
Provision for loan losses | 82 | — | 187 | — | 269 | |||||||||||||||
Noninterest expense | ||||||||||||||||||||
Compensation and benefits expense | 19 | — | 246 | — | 265 | |||||||||||||||
Insurance losses and loss adjustment expenses | — | — | 125 | — | 125 | |||||||||||||||
Other operating expenses | 213 | — | 478 | (271 | ) | 420 | ||||||||||||||
Total noninterest expense | 232 | — | 849 | (271 | ) | 810 | ||||||||||||||
(Loss) income from continuing operations before income tax (benefit) expense and undistributed income (loss) of subsidiaries | (60 | ) | — | 823 | (387 | ) | 376 | |||||||||||||
Income tax (benefit) expense from continuing operations | (93 | ) | — | 215 | — | 122 | ||||||||||||||
Net income from continuing operations | 33 | — | 608 | (387 | ) | 254 | ||||||||||||||
Loss from discontinued operations, net of tax | — | — | (2 | ) | — | (2 | ) | |||||||||||||
Undistributed income (loss) of subsidiaries | ||||||||||||||||||||
Bank subsidiary | 375 | 375 | — | (750 | ) | — | ||||||||||||||
Nonbank subsidiaries | (156 | ) | — | — | 156 | — | ||||||||||||||
Net income | 252 | 375 | 606 | (981 | ) | 252 | ||||||||||||||
Other comprehensive income, net of tax | 76 | 50 | 72 | (122 | ) | 76 | ||||||||||||||
Comprehensive income | $ | 328 | $ | 425 | $ | 678 | $ | (1,103 | ) | $ | 328 |
Six months ended June 30, 2018 ($ in millions) | Parent | Guarantors | Nonguarantors | Consolidating adjustments | Ally consolidated | |||||||||||||||
Financing revenue and other interest income | ||||||||||||||||||||
Interest and fees on finance receivables and loans | $ | 10 | $ | — | $ | 3,180 | $ | — | $ | 3,190 | ||||||||||
Interest and fees on finance receivables and loans — intercompany | 6 | — | 2 | (8 | ) | — | ||||||||||||||
Interest on loans held-for-sale | — | — | 6 | — | 6 | |||||||||||||||
Interest and dividends on investment securities and other earning assets | — | — | 365 | (1 | ) | 364 | ||||||||||||||
Interest on cash and cash equivalents | 4 | — | 28 | — | 32 | |||||||||||||||
Interest-bearing cash — intercompany | 4 | — | 4 | (8 | ) | — | ||||||||||||||
Operating leases | 3 | — | 753 | — | 756 | |||||||||||||||
Total financing revenue and other interest income | 27 | — | 4,338 | (17 | ) | 4,348 | ||||||||||||||
Interest expense | ||||||||||||||||||||
Interest on deposits | — | — | 750 | — | 750 | |||||||||||||||
Interest on short-term borrowings | 20 | — | 52 | — | 72 | |||||||||||||||
Interest on long-term debt | 515 | — | 330 | — | 845 | |||||||||||||||
Interest on intercompany debt | 7 | — | 10 | (17 | ) | — | ||||||||||||||
Total interest expense | 542 | — | 1,142 | (17 | ) | 1,667 | ||||||||||||||
Net depreciation expense on operating lease assets | 5 | — | 533 | — | 538 | |||||||||||||||
Net financing (loss) revenue | (520 | ) | — | 2,663 | — | 2,143 | ||||||||||||||
Cash dividends from subsidiaries | ||||||||||||||||||||
Bank subsidiary | 1,500 | 1,500 | — | (3,000 | ) | — | ||||||||||||||
Nonbank subsidiaries | 301 | — | — | (301 | ) | — | ||||||||||||||
Other revenue | ||||||||||||||||||||
Insurance premiums and service revenue earned | — | — | 495 | — | 495 | |||||||||||||||
Gain on mortgage and automotive loans, net | 28 | — | 2 | (28 | ) | 2 | ||||||||||||||
Other gain on investments, net | — | — | 15 | — | 15 | |||||||||||||||
Other income, net of losses | 196 | — | 406 | (396 | ) | 206 | ||||||||||||||
Total other revenue | 224 | — | 918 | (424 | ) | 718 | ||||||||||||||
Total net revenue | 1,505 | 1,500 | 3,581 | (3,725 | ) | 2,861 | ||||||||||||||
Provision for loan losses | 113 | — | 334 | (28 | ) | 419 | ||||||||||||||
Noninterest expense | ||||||||||||||||||||
Compensation and benefits expense | 48 | — | 550 | — | 598 | |||||||||||||||
Insurance losses and loss adjustment expenses | — | — | 164 | — | 164 | |||||||||||||||
Other operating expenses | 355 | — | 932 | (396 | ) | 891 | ||||||||||||||
Total noninterest expense | 403 | — | 1,646 | (396 | ) | 1,653 | ||||||||||||||
Income from continuing operations before income tax (benefit) expense and undistributed (loss) income of subsidiaries | 989 | 1,500 | 1,601 | (3,301 | ) | 789 | ||||||||||||||
Income tax (benefit) expense from continuing operations | (122 | ) | — | 311 | — | 189 | ||||||||||||||
Net income from continuing operations | 1,111 | 1,500 | 1,290 | (3,301 | ) | 600 | ||||||||||||||
(Loss) income from discontinued operations, net of tax | (2 | ) | — | 1 | — | (1 | ) | |||||||||||||
Undistributed (loss) income of subsidiaries | ||||||||||||||||||||
Bank subsidiary | (545 | ) | (545 | ) | — | 1,090 | — | |||||||||||||
Nonbank subsidiaries | 35 | — | — | (35 | ) | — | ||||||||||||||
Net income | 599 | 955 | 1,291 | (2,246 | ) | 599 | ||||||||||||||
Other comprehensive loss, net of tax | (398 | ) | (332 | ) | (413 | ) | 745 | (398 | ) | |||||||||||
Comprehensive income | $ | 201 | $ | 623 | $ | 878 | $ | (1,501 | ) | $ | 201 |
Six months ended June 30, 2017 ($ in millions) | Parent | Guarantors | Nonguarantors | Consolidating adjustments | Ally consolidated | |||||||||||||||
Financing (loss) revenue and other interest income | ||||||||||||||||||||
Interest and fees on finance receivables and loans | $ | (70 | ) | $ | — | $ | 2,885 | $ | — | $ | 2,815 | |||||||||
Interest and fees on finance receivables and loans — intercompany | 7 | — | 4 | (11 | ) | — | ||||||||||||||
Interest and dividends on investment securities and other earning assets | — | — | 281 | (1 | ) | 280 | ||||||||||||||
Interest on cash and cash equivalents | 4 | — | 8 | — | 12 | |||||||||||||||
Interest-bearing cash — intercompany | — | — | 3 | (3 | ) | — | ||||||||||||||
Operating leases | 6 | — | 1,025 | — | 1,031 | |||||||||||||||
Total financing (loss) revenue and other interest income | (53 | ) | — | 4,206 | (15 | ) | 4,138 | |||||||||||||
Interest expense | ||||||||||||||||||||
Interest on deposits | 2 | — | 479 | — | 481 | |||||||||||||||
Interest on short-term borrowings | 36 | — | 24 | — | 60 | |||||||||||||||
Interest on long-term debt | 556 | — | 285 | — | 841 | |||||||||||||||
Interest on intercompany debt | 8 | — | 7 | (15 | ) | — | ||||||||||||||
Total interest expense | 602 | — | 795 | (15 | ) | 1,382 | ||||||||||||||
Net depreciation expense on operating lease assets | 5 | — | 705 | — | 710 | |||||||||||||||
Net financing (loss) revenue | (660 | ) | — | 2,706 | — | 2,046 | ||||||||||||||
Cash dividends from subsidiaries | ||||||||||||||||||||
Nonbank subsidiaries | 427 | — | — | (427 | ) | — | ||||||||||||||
Other revenue | ||||||||||||||||||||
Insurance premiums and service revenue earned | — | — | 468 | — | 468 | |||||||||||||||
Gain on mortgage and automotive loans, net | 30 | — | 20 | — | 50 | |||||||||||||||
Other gain on investments, net | — | — | 50 | — | 50 | |||||||||||||||
Other income, net of losses | 431 | — | 433 | (648 | ) | 216 | ||||||||||||||
Total other revenue | 461 | — | 971 | (648 | ) | 784 | ||||||||||||||
Total net revenue | 228 | — | 3,677 | (1,075 | ) | 2,830 | ||||||||||||||
Provision for loan losses | 189 | — | 351 | — | 540 | |||||||||||||||
Noninterest expense | ||||||||||||||||||||
Compensation and benefits expense | 140 | — | 410 | — | 550 | |||||||||||||||
Insurance losses and loss adjustment expenses | — | — | 213 | — | 213 | |||||||||||||||
Other operating expenses | 501 | — | 972 | (648 | ) | 825 | ||||||||||||||
Total noninterest expense | 641 | — | 1,595 | (648 | ) | 1,588 | ||||||||||||||
(Loss) income from continuing operations before income tax (benefit) expense and undistributed income of subsidiaries | (602 | ) | — | 1,731 | (427 | ) | 702 | |||||||||||||
Income tax (benefit) expense from continuing operations | (227 | ) | — | 462 | — | 235 | ||||||||||||||
Net (loss) income from continuing operations | (375 | ) | — | 1,269 | (427 | ) | 467 | |||||||||||||
Income (loss) from discontinued operations, net of tax | 2 | — | (3 | ) | — | (1 | ) | |||||||||||||
Undistributed income of subsidiaries | ||||||||||||||||||||
Bank subsidiary | 764 | 764 | — | (1,528 | ) | — | ||||||||||||||
Nonbank subsidiaries | 75 | — | — | (75 | ) | — | ||||||||||||||
Net income | 466 | 764 | 1,266 | (2,030 | ) | 466 | ||||||||||||||
Other comprehensive income, net of tax | 96 | 55 | 91 | (146 | ) | 96 | ||||||||||||||
Comprehensive income | $ | 562 | $ | 819 | $ | 1,357 | $ | (2,176 | ) | $ | 562 |
June 30, 2018 ($ in millions) | Parent (a) | Guarantors | Nonguarantors (a) | Consolidating adjustments | Ally consolidated | |||||||||||||||
Assets | ||||||||||||||||||||
Cash and cash equivalents | ||||||||||||||||||||
Noninterest-bearing | $ | 49 | $ | — | $ | 750 | $ | — | $ | 799 | ||||||||||
Interest-bearing | 6 | — | 3,119 | — | 3,125 | |||||||||||||||
Interest-bearing — intercompany | 1,016 | — | 569 | (1,585 | ) | — | ||||||||||||||
Total cash and cash equivalents | 1,071 | — | 4,438 | (1,585 | ) | 3,924 | ||||||||||||||
Equity securities | — | — | 521 | — | 521 | |||||||||||||||
Available-for-sale securities | — | — | 23,296 | — | 23,296 | |||||||||||||||
Held-to-maturity securities | — | — | 2,146 | (57 | ) | 2,089 | ||||||||||||||
Loans held-for-sale, net | — | — | 328 | — | 328 | |||||||||||||||
Finance receivables and loans, net | ||||||||||||||||||||
Finance receivables and loans, net | 5,647 | — | 119,897 | — | 125,544 | |||||||||||||||
Intercompany loans to | ||||||||||||||||||||
Nonbank subsidiaries | 786 | — | 405 | (1,191 | ) | — | ||||||||||||||
Allowance for loan losses | (128 | ) | — | (1,129 | ) | — | (1,257 | ) | ||||||||||||
Total finance receivables and loans, net | 6,305 | — | 119,173 | (1,191 | ) | 124,287 | ||||||||||||||
Investment in operating leases, net | 10 | — | 8,629 | — | 8,639 | |||||||||||||||
Intercompany receivables from | ||||||||||||||||||||
Bank subsidiary | 106 | — | — | (106 | ) | — | ||||||||||||||
Nonbank subsidiaries | 61 | — | 88 | (149 | ) | — | ||||||||||||||
Investment in subsidiaries | ||||||||||||||||||||
Bank subsidiary | 16,163 | 16,163 | — | (32,326 | ) | — | ||||||||||||||
Nonbank subsidiaries | 7,162 | — | — | (7,162 | ) | — | ||||||||||||||
Premiums receivable and other insurance assets | — | — | 2,247 | — | 2,247 | |||||||||||||||
Other assets | 2,123 | — | 5,129 | (1,238 | ) | 6,014 | ||||||||||||||
Total assets | $ | 33,001 | $ | 16,163 | $ | 165,995 | $ | (43,814 | ) | $ | 171,345 | |||||||||
Liabilities | ||||||||||||||||||||
Deposit liabilities | ||||||||||||||||||||
Noninterest-bearing | $ | — | $ | — | $ | 153 | $ | — | $ | 153 | ||||||||||
Interest-bearing | 6 | — | 98,575 | — | 98,581 | |||||||||||||||
Interest-bearing — intercompany | — | — | 1,016 | (1,016 | ) | — | ||||||||||||||
Total deposit liabilities | 6 | — | 99,744 | (1,016 | ) | 98,734 | ||||||||||||||
Short-term borrowings | 2,666 | — | 4,442 | — | 7,108 | |||||||||||||||
Long-term debt | 15,571 | — | 31,757 | — | 47,328 | |||||||||||||||
Intercompany debt to | ||||||||||||||||||||
Bank subsidiary | 57 | — | — | (57 | ) | — | ||||||||||||||
Nonbank subsidiaries | 973 | — | 786 | (1,759 | ) | — | ||||||||||||||
Intercompany payables to | ||||||||||||||||||||
Nonbank subsidiaries | 130 | — | 129 | (259 | ) | — | ||||||||||||||
Interest payable | 192 | — | 376 | — | 568 | |||||||||||||||
Unearned insurance premiums and service revenue | — | — | 2,957 | — | 2,957 | |||||||||||||||
Accrued expenses and other liabilities | 267 | — | 2,479 | (1,235 | ) | 1,511 | ||||||||||||||
Total liabilities | 19,862 | — | 142,670 | (4,326 | ) | 158,206 | ||||||||||||||
Total equity | 13,139 | 16,163 | 23,325 | (39,488 | ) | 13,139 | ||||||||||||||
Total liabilities and equity | $ | 33,001 | $ | 16,163 | $ | 165,995 | $ | (43,814 | ) | $ | 171,345 |
(a) | Amounts presented are based upon the legal transfer of the underlying assets to VIEs in order to reflect legal ownership. |
December 31, 2017 ($ in millions) | Parent (a) | Guarantors | Nonguarantors (a) | Consolidating adjustments | Ally consolidated | |||||||||||||||
Assets | ||||||||||||||||||||
Cash and cash equivalents | ||||||||||||||||||||
Noninterest-bearing | $ | 74 | $ | — | $ | 770 | $ | — | $ | 844 | ||||||||||
Interest-bearing | 5 | — | 3,403 | — | 3,408 | |||||||||||||||
Interest-bearing — intercompany | 1,138 | — | 695 | (1,833 | ) | — | ||||||||||||||
Total cash and cash equivalents | 1,217 | — | 4,868 | (1,833 | ) | 4,252 | ||||||||||||||
Equity securities | — | — | 518 | — | 518 | |||||||||||||||
Available-for-sale securities | — | — | 22,303 | — | 22,303 | |||||||||||||||
Held-to-maturity securities | — | — | 1,973 | (74 | ) | 1,899 | ||||||||||||||
Loans held-for-sale, net | — | — | 108 | — | 108 | |||||||||||||||
Finance receivables and loans, net | ||||||||||||||||||||
Finance receivables and loans, net | 7,434 | — | 115,459 | — | 122,893 | |||||||||||||||
Intercompany loans to | ||||||||||||||||||||
Nonbank subsidiaries | 879 | — | 408 | (1,287 | ) | — | ||||||||||||||
Allowance for loan losses | (185 | ) | — | (1,091 | ) | — | (1,276 | ) | ||||||||||||
Total finance receivables and loans, net | 8,128 | — | 114,776 | (1,287 | ) | 121,617 | ||||||||||||||
Investment in operating leases, net | 19 | — | 8,722 | — | 8,741 | |||||||||||||||
Intercompany receivables from | ||||||||||||||||||||
Bank subsidiary | 80 | — | — | (80 | ) | — | ||||||||||||||
Nonbank subsidiaries | 71 | — | 77 | (148 | ) | — | ||||||||||||||
Investment in subsidiaries | ||||||||||||||||||||
Bank subsidiary | 16,962 | 16,962 | — | (33,924 | ) | — | ||||||||||||||
Nonbank subsidiaries | 8,111 | — | — | (8,111 | ) | — | ||||||||||||||
Premiums receivable and other insurance assets | — | — | 2,082 | (35 | ) | 2,047 | ||||||||||||||
Other assets | 2,207 | — | 5,105 | (1,649 | ) | 5,663 | ||||||||||||||
Total assets | $ | 36,795 | $ | 16,962 | $ | 160,532 | $ | (47,141 | ) | $ | 167,148 | |||||||||
Liabilities | ||||||||||||||||||||
Deposit liabilities | ||||||||||||||||||||
Noninterest-bearing | $ | — | $ | — | $ | 108 | $ | — | $ | 108 | ||||||||||
Interest-bearing | 12 | — | 93,136 | — | 93,148 | |||||||||||||||
Interest-bearing — intercompany | — | — | 1,139 | (1,139 | ) | — | ||||||||||||||
Total deposit liabilities | 12 | — | 94,383 | (1,139 | ) | 93,256 | ||||||||||||||
Short-term borrowings | 3,171 | — | 8,242 | — | 11,413 | |||||||||||||||
Long-term debt | 17,966 | — | 26,260 | — | 44,226 | |||||||||||||||
Intercompany debt to | ||||||||||||||||||||
Bank subsidiary | 74 | — | — | (74 | ) | — | ||||||||||||||
Nonbank subsidiaries | 1,103 | — | 879 | (1,982 | ) | — | ||||||||||||||
Intercompany payables to | ||||||||||||||||||||
Bank subsidiary | 4 | — | — | (4 | ) | — | ||||||||||||||
Nonbank subsidiaries | 132 | — | 127 | (259 | ) | — | ||||||||||||||
Interest payable | 200 | — | 175 | — | 375 | |||||||||||||||
Unearned insurance premiums and service revenue | — | — | 2,604 | — | 2,604 | |||||||||||||||
Accrued expenses and other liabilities | 639 | — | 2,790 | (1,649 | ) | 1,780 | ||||||||||||||
Total liabilities | 23,301 | — | 135,460 | (5,107 | ) | 153,654 | ||||||||||||||
Total equity | 13,494 | 16,962 | 25,072 | (42,034 | ) | 13,494 | ||||||||||||||
Total liabilities and equity | $ | 36,795 | $ | 16,962 | $ | 160,532 | $ | (47,141 | ) | $ | 167,148 |
(a) | Amounts presented are based upon the legal transfer of the underlying assets to VIEs in order to reflect legal ownership. |
Six months ended June 30, 2018 ($ in millions) | Parent | Guarantors | Nonguarantors | Consolidating adjustments | Ally consolidated | |||||||||||||||
Operating activities | ||||||||||||||||||||
Net cash provided by operating activities | $ | 958 | $ | 1,500 | $ | 2,853 | $ | (3,302 | ) | $ | 2,009 | |||||||||
Investing activities | ||||||||||||||||||||
Purchases of equity securities | — | — | (500 | ) | — | (500 | ) | |||||||||||||
Proceeds from sales of equity securities | — | — | 535 | — | 535 | |||||||||||||||
Purchases of available-for-sale securities | — | — | (4,094 | ) | — | (4,094 | ) | |||||||||||||
Proceeds from sales of available-for-sale securities | — | — | 390 | — | 390 | |||||||||||||||
Proceeds from repayments of available-for-sale securities | — | — | 1,621 | — | 1,621 | |||||||||||||||
Purchases of held-to-maturity securities | — | — | (316 | ) | — | (316 | ) | |||||||||||||
Proceeds from repayments of held-to-maturity securities | — | — | 72 | — | 72 | |||||||||||||||
Net change in investment securities — intercompany | — | — | 17 | (17 | ) | — | ||||||||||||||
Purchases of finance receivables and loans held-for-investment | — | — | (3,431 | ) | 820 | (2,611 | ) | |||||||||||||
Proceeds from sales of finance receivables and loans initially held-for-investment | 820 | — | — | (820 | ) | — | ||||||||||||||
Originations and repayments of finance receivables and loans held-for-investment and other, net | 1,331 | — | (1,969 | ) | — | (638 | ) | |||||||||||||
Net change in loans — intercompany | 83 | — | (5 | ) | (78 | ) | — | |||||||||||||
Purchases of operating lease assets | — | — | (2,107 | ) | — | (2,107 | ) | |||||||||||||
Disposals of operating lease assets | 6 | — | 1,757 | — | 1,763 | |||||||||||||||
Capital contributions to subsidiaries | (57 | ) | (6 | ) | — | 63 | — | |||||||||||||
Returns of contributed capital | 194 | — | — | (194 | ) | — | ||||||||||||||
Net change in nonmarketable equity investments | — | — | (46 | ) | — | (46 | ) | |||||||||||||
Other, net | (3 | ) | — | (183 | ) | — | (186 | ) | ||||||||||||
Net cash provided by (used in) investing activities | 2,374 | (6 | ) | (8,259 | ) | (226 | ) | (6,117 | ) | |||||||||||
Financing activities | ||||||||||||||||||||
Net change in short-term borrowings — third party | (505 | ) | — | (3,800 | ) | — | (4,305 | ) | ||||||||||||
Net (decrease) increase in deposits | (6 | ) | — | 5,324 | 123 | 5,441 | ||||||||||||||
Proceeds from issuance of long-term debt — third party | 32 | — | 12,908 | — | 12,940 | |||||||||||||||
Repayments of long-term debt — third party | (2,412 | ) | — | (7,388 | ) | — | (9,800 | ) | ||||||||||||
Net change in debt — intercompany | (138 | ) | — | (83 | ) | 221 | — | |||||||||||||
Repurchase of common stock | (380 | ) | — | — | — | (380 | ) | |||||||||||||
Dividends paid — third party | (115 | ) | — | — | — | (115 | ) | |||||||||||||
Dividends paid and returns of contributed capital — intercompany | — | (1,500 | ) | (1,995 | ) | 3,495 | — | |||||||||||||
Capital contributions from parent | — | 6 | 57 | (63 | ) | — | ||||||||||||||
Net cash (used in) provided by financing activities | (3,524 | ) | (1,494 | ) | 5,023 | 3,776 | 3,781 | |||||||||||||
Effect of exchange-rate changes on cash and cash equivalents | — | — | (3 | ) | — | (3 | ) | |||||||||||||
Net decrease in cash and cash equivalents and restricted cash | (192 | ) | — | (386 | ) | 248 | (330 | ) | ||||||||||||
Cash and cash equivalents and restricted cash at beginning of year | 1,395 | — | 5,707 | (1,833 | ) | 5,269 | ||||||||||||||
Cash and cash equivalents and restricted cash at June 30, | $ | 1,203 | $ | — | $ | 5,321 | $ | (1,585 | ) | $ | 4,939 |
June 30, 2018 ($ in millions) | Parent | Guarantors | Nonguarantors | Consolidating adjustments | Ally consolidated | |||||||||||||||
Cash and cash equivalents as disclosed on the Condensed Consolidated Balance Sheet | $ | 1,071 | $ | — | $ | 4,438 | $ | (1,585 | ) | $ | 3,924 | |||||||||
Restricted cash included in other assets on the Condensed Consolidated Balance Sheet (a) | 132 | — | 883 | — | 1,015 | |||||||||||||||
Total cash and cash equivalents and restricted cash as disclosed in the Condensed Consolidated Statement of Cash Flows | $ | 1,203 | $ | — | $ | 5,321 | $ | (1,585 | ) | $ | 4,939 |
(a) | Restricted cash balances relate primarily to Ally securitization arrangements. Refer to Note 11 for additional details describing the nature of restricted cash balances. |
Six months ended June 30, 2017 ($ in millions) | Parent | Guarantors | Nonguarantors | Consolidating adjustments | Ally consolidated | |||||||||||||||
Operating activities | ||||||||||||||||||||
Net cash provided by operating activities | $ | 561 | $ | — | $ | 1,856 | $ | (347 | ) | $ | 2,070 | |||||||||
Investing activities | ||||||||||||||||||||
Purchases of equity securities | — | — | (363 | ) | — | (363 | ) | |||||||||||||
Proceeds from sales of equity securities | — | — | 484 | — | 484 | |||||||||||||||
Purchases of available-for-sale securities | — | — | (5,490 | ) | — | (5,490 | ) | |||||||||||||
Proceeds from sales of available-for-sale securities | — | — | 1,678 | — | 1,678 | |||||||||||||||
Proceeds from repayments of available-for-sale securities | — | — | 1,230 | — | 1,230 | |||||||||||||||
Purchases of held-to-maturity securities | — | — | (313 | ) | — | (313 | ) | |||||||||||||
Proceeds from repayments of held-to-maturity securities | — | — | 17 | — | 17 | |||||||||||||||
Net change in investment securities — intercompany | 1 | — | 269 | (270 | ) | — | ||||||||||||||
Purchases of finance receivables and loans held-for-investment | (35 | ) | — | (1,782 | ) | — | (1,817 | ) | ||||||||||||
Proceeds from sales of finance receivables and loans initially held-for-investment | 67 | — | 1,213 | — | 1,280 | |||||||||||||||
Originations and repayments of finance receivables and loans held-for-investment and other, net | 1,044 | — | (676 | ) | (1,956 | ) | (1,588 | ) | ||||||||||||
Net change in loans — intercompany | 1,864 | — | 246 | (2,110 | ) | — | ||||||||||||||
Purchases of operating lease assets | — | — | (1,965 | ) | — | (1,965 | ) | |||||||||||||
Disposals of operating lease assets | 4 | — | 3,039 | — | 3,043 | |||||||||||||||
Capital contributions to subsidiaries | (824 | ) | — | — | 824 | — | ||||||||||||||
Returns of contributed capital | 838 | — | — | (838 | ) | — | ||||||||||||||
Net change in nonmarketable equity investments | — | — | 107 | — | 107 | |||||||||||||||
Other, net | (21 | ) | — | 27 | (96 | ) | (90 | ) | ||||||||||||
Net cash provided by (used in) investing activities | 2,938 | — | (2,279 | ) | (4,446 | ) | (3,787 | ) | ||||||||||||
Financing activities | ||||||||||||||||||||
Net change in short-term borrowings — third party | 1,083 | — | (3,045 | ) | — | (1,962 | ) | |||||||||||||
Net (decrease) increase in deposits | (123 | ) | — | 7,256 | — | 7,133 | ||||||||||||||
Proceeds from issuance of long-term debt — third party | 353 | — | 7,016 | 1,961 | 9,330 | |||||||||||||||
Repayments of long-term debt — third party | (3,323 | ) | — | (11,043 | ) | — | (14,366 | ) | ||||||||||||
Net change in debt — intercompany | (370 | ) | — | (1,864 | ) | 2,234 | — | |||||||||||||
Repurchase of common stock | (373 | ) | — | — | — | (373 | ) | |||||||||||||
Dividends paid — third party | (75 | ) | — | — | — | (75 | ) | |||||||||||||
Dividends paid and returns of contributed capital — intercompany | — | — | (1,266 | ) | 1,266 | — | ||||||||||||||
Capital contributions from parent | — | — | 824 | (824 | ) | — | ||||||||||||||
Net cash used in financing activities | (2,828 | ) | — | (2,122 | ) | 4,637 | (313 | ) | ||||||||||||
Effect of exchange-rate changes on cash and cash equivalents | — | — | 2 | — | 2 | |||||||||||||||
Net increase (decrease) in cash and cash equivalents and restricted cash | 671 | — | (2,543 | ) | (156 | ) | (2,028 | ) | ||||||||||||
Cash and cash equivalents and restricted cash at beginning of year | 989 | — | 7,293 | (401 | ) | 7,881 | ||||||||||||||
Cash and cash equivalents and restricted cash at June 30, | $ | 1,660 | $ | — | $ | 4,750 | $ | (557 | ) | $ | 5,853 |
June 30, 2017 ($ in millions) | Parent | Guarantors | Nonguarantors | Consolidating adjustments | Ally consolidated | |||||||||||||||
Cash and cash equivalents as disclosed on the Condensed Consolidated Balance Sheet | $ | 1,441 | $ | — | $ | 3,493 | $ | (557 | ) | $ | 4,377 | |||||||||
Restricted cash included in other assets on the Condensed Consolidated Balance Sheet (a) | 219 | — | 1,257 | — | 1,476 | |||||||||||||||
Total cash and cash equivalents and restricted cash as disclosed in the Condensed Consolidated Statement of Cash Flows | $ | 1,660 | $ | — | $ | 4,750 | $ | (557 | ) | $ | 5,853 |
(a) | Restricted cash balances relate primarily to Ally securitization arrangements. Refer to Note 11 for additional details describing the nature of restricted cash balances. |
Three months ended June 30, | Six months ended June 30, | |||||||||||||||
($ in millions, except per share data; shares in thousands) | 2018 | 2017 | 2018 | 2017 | ||||||||||||
Total financing revenue and other interest income | $ | 2,232 | $ | 2,088 | $ | 4,348 | $ | 4,138 | ||||||||
Total interest expense | 873 | 700 | 1,667 | 1,382 | ||||||||||||
Net depreciation expense on operating lease assets | 265 | 321 | 538 | 710 | ||||||||||||
Net financing revenue and other interest income | 1,094 | 1,067 | 2,143 | 2,046 | ||||||||||||
Total other revenue | 364 | 388 | 718 | 784 | ||||||||||||
Total net revenue | 1,458 | 1,455 | 2,861 | 2,830 | ||||||||||||
Provision for loan losses | 158 | 269 | 419 | 540 | ||||||||||||
Total noninterest expense | 839 | 810 | 1,653 | 1,588 | ||||||||||||
Income from continuing operations before income tax expense | 461 | 376 | 789 | 702 | ||||||||||||
Income tax expense from continuing operations | 113 | 122 | 189 | 235 | ||||||||||||
Net income from continuing operations | 348 | 254 | 600 | 467 | ||||||||||||
Income (loss) from discontinued operations, net of tax | 1 | (2 | ) | (1 | ) | (1 | ) | |||||||||
Net income | $ | 349 | $ | 252 | $ | 599 | $ | 466 | ||||||||
Basic earnings per common share (a): | ||||||||||||||||
Net income from continuing operations | $ | 0.81 | $ | 0.55 | $ | 1.38 | $ | 1.01 | ||||||||
Net income | 0.81 | 0.55 | 1.38 | 1.01 | ||||||||||||
Weighted-average common shares outstanding | 430,628 | 457,891 | 433,405 | 461,904 | ||||||||||||
Diluted earnings per common share (a): | ||||||||||||||||
Net income from continuing operations | $ | 0.80 | $ | 0.55 | $ | 1.38 | $ | 1.01 | ||||||||
Net income | 0.81 | 0.55 | 1.37 | 1.01 | ||||||||||||
Weighted-average common shares outstanding | 432,554 | 458,819 | 435,727 | 462,802 | ||||||||||||
Market price per common share: | ||||||||||||||||
High closing | $ | 28.13 | $ | 21.21 | $ | 30.83 | $ | 23.48 | ||||||||
Low closing | 25.25 | 18.22 | 25.25 | 18.22 | ||||||||||||
Period-end closing | 26.27 | 20.90 | 26.27 | 20.90 | ||||||||||||
Cash dividends declared per common share | $ | 0.13 | $ | 0.08 | $ | 0.26 | $ | 0.16 | ||||||||
Period-end common shares outstanding | 425,752 | 452,292 | 425,752 | 452,292 |
(a) | Includes shares related to share-based compensation that vested but were not yet issued for the three months and six months ended June 30, 2018, and 2017. |
June 30, ($ in millions) | 2018 | 2017 | ||||||
Selected period-end balance sheet data: | ||||||||
Total assets | $ | 171,345 | $ | 164,345 | ||||
Total deposit liabilities | $ | 98,734 | $ | 86,183 | ||||
Long-term debt | $ | 47,328 | $ | 49,145 | ||||
Total equity | $ | 13,139 | $ | 13,473 |
Three months ended June 30, | Six months ended June 30, | |||||||||||
2018 | 2017 | 2018 | 2017 | |||||||||
Financial ratios: | ||||||||||||
Return on average assets (a) | 0.82 | % | 0.62 | % | 0.72 | % | 0.58 | % | ||||
Return on average equity (a) | 10.71 | % | 7.52 | % | 9.19 | % | 6.99 | % | ||||
Equity to assets (a) | 7.68 | % | 8.27 | % | 7.78 | % | 8.31 | % | ||||
Common dividend payout ratio (b) | 16.05 | % | 14.55 | % | 18.84 | % | 15.84 | % | ||||
Net interest spread (a) (c) | 2.53 | % | 2.63 | % | 2.50 | % | 2.55 | % | ||||
Net yield on interest-earning assets (a) (d) | 2.68 | % | 2.76 | % | 2.66 | % | 2.68 | % |
(a) | The ratios were based on average assets and average equity using a combination of monthly and daily average methodologies. |
(b) | Common dividend payout ratio was calculated using basic earnings per common share. |
(c) | Net interest spread represents the difference between the rate on total interest-earning assets and the rate on total interest-bearing liabilities, excluding discontinued operations for the periods shown. |
(d) | Net yield on interest-earning assets represents annualized net financing revenue and other interest income as a percentage of total interest-earning assets. |
June 30, 2018 | June 30, 2017 | |||||||||||||||
($ in millions) | Transitional | Fully phased-in (a) | Transitional | Fully phased-in (a) | ||||||||||||
Common Equity Tier 1 capital ratio | 9.37 | % | 9.35 | % | 9.47 | % | 9.37 | % | ||||||||
Tier 1 capital ratio | 11.09 | % | 11.06 | % | 11.18 | % | 11.13 | % | ||||||||
Total capital ratio | 12.66 | % | 12.63 | % | 12.83 | % | 12.79 | % | ||||||||
Tier 1 leverage ratio (to adjusted quarterly average assets) (b) | 9.21 | % | 9.21 | % | 9.51 | % | 9.51 | % | ||||||||
Total equity | $ | 13,139 | $ | 13,139 | $ | 13,473 | $ | 13,473 | ||||||||
Goodwill and certain other intangibles | (289 | ) | (289 | ) | (279 | ) | (289 | ) | ||||||||
Deferred tax assets arising from net operating loss and tax credit carryforwards (c) | (251 | ) | (251 | ) | (378 | ) | (473 | ) | ||||||||
Other adjustments | 666 | 666 | 250 | 250 | ||||||||||||
Common Equity Tier 1 capital | 13,265 | 13,265 | 13,066 | 12,961 | ||||||||||||
Trust preferred securities | 2,492 | 2,492 | 2,490 | 2,490 | ||||||||||||
Deferred tax assets arising from net operating loss and tax credit carryforwards | — | — | (95 | ) | — | |||||||||||
Other adjustments | (59 | ) | (59 | ) | (44 | ) | (44 | ) | ||||||||
Tier 1 capital | 15,698 | 15,698 | 15,417 | 15,407 | ||||||||||||
Qualifying subordinated debt and other instruments qualifying as Tier 2 | 1,030 | 1,030 | 1,106 | 1,106 | ||||||||||||
Qualifying allowance for credit losses and other adjustments | 1,198 | 1,198 | 1,181 | 1,181 | ||||||||||||
Total capital | $ | 17,926 | $ | 17,926 | $ | 17,704 | $ | 17,694 | ||||||||
Risk-weighted assets (d) | $ | 141,605 | $ | 141,892 | $ | 137,947 | $ | 138,380 |
(a) | Our fully phased-in capital ratios are non-GAAP financial measures that management believes are important to the reader of the Condensed Consolidated Financial Statements but should be supplemental to, and not a substitute for, primary GAAP measures. The fully phased-in capital ratios are compared to the transitional capital ratios above. We believe these capital ratios are important because we believe investors, analysts, and banking regulators may assess our capital utilization and adequacy using these ratios. Additionally, presentation of these ratios allows readers to compare certain aspects of our capital utilization and adequacy on the same basis to other companies in the industry. |
(b) | Tier 1 leverage ratio equals Tier 1 capital divided by adjusted quarterly average total assets (which reflects adjustments for disallowed goodwill, certain intangible assets, and disallowed deferred tax assets). |
(c) | Contains deferred tax assets required to be deducted from capital under U.S. Basel III. |
(d) | Risk-weighted assets are defined by regulation and are generally determined by allocating assets and specified off-balance sheet exposures into various risk categories. |
Three months ended June 30, | Six months ended June 30, | |||||||||||||||||||
($ in millions) | 2018 | 2017 | Favorable/(unfavorable) % change | 2018 | 2017 | Favorable/(unfavorable) % change | ||||||||||||||
Total net revenue | ||||||||||||||||||||
Dealer Financial Services | ||||||||||||||||||||
Automotive Finance | $ | 988 | $ | 1,039 | (5) | $ | 1,963 | $ | 2,032 | (3) | ||||||||||
Insurance | 279 | 259 | 8 | 537 | 538 | — | ||||||||||||||
Mortgage Finance | 46 | 33 | 39 | 90 | 67 | 34 | ||||||||||||||
Corporate Finance | 71 | 58 | 22 | 125 | 110 | 14 | ||||||||||||||
Corporate and Other | 74 | 66 | 12 | 146 | 83 | 76 | ||||||||||||||
Total | $ | 1,458 | $ | 1,455 | — | $ | 2,861 | $ | 2,830 | 1 | ||||||||||
Income (loss) from continuing operations before income tax expense | ||||||||||||||||||||
Dealer Financial Services | ||||||||||||||||||||
Automotive Finance | $ | 382 | $ | 347 | 10 | $ | 650 | $ | 635 | 2 | ||||||||||
Insurance | 11 | (21 | ) | 152 | 38 | 19 | 100 | |||||||||||||
Mortgage Finance | 14 | 7 | 100 | 22 | 16 | 38 | ||||||||||||||
Corporate Finance | 58 | 35 | 66 | 87 | 60 | 45 | ||||||||||||||
Corporate and Other | (4 | ) | 8 | (150) | (8 | ) | (28 | ) | 71 | |||||||||||
Total | $ | 461 | $ | 376 | 23 | $ | 789 | $ | 702 | 12 |
• | Our Dealer Financial Services is one of the largest full service automotive finance operations in the country and offers a wide range of financial services and insurance products to approximately 18,900 automotive dealerships and approximately 4.3 million consumer automotive customers. Dealer Financial Services consists of two separate reportable segments—Automotive Finance and Insurance operations. |
• | Our Mortgage Finance operations consist of held-for-investment and held-for-sale consumer mortgage finance loan portfolios. We acquire mortgage loans through two primary channels including bulk purchases of high-quality jumbo and low-to-moderate income (LMI) mortgage loans originated by third parties, as well as direct-to-consumer mortgage offerings through Ally Home. The combination of our bulk portfolio purchase program and our direct-to-consumer strategy provides the capacity to expand revenue sources and further grow and diversify our finance receivable portfolio with an attractive asset class while also deepening relationships with existing Ally customers. |
• | Our Corporate Finance operations primarily provide senior secured leveraged cash flow and asset-based loans to mostly U.S.-based middle-market companies. We believe our attractive deposit-based funding model coupled with our expanded product offerings and deep industry relationships provide an advantage over our competition, which includes other banks as well as publicly and privately held finance companies. Our Corporate Finance lending portfolio is almost entirely composed of first lien, first out loans. Our primary focus is on businesses owned by private equity sponsors with loans typically used for leveraged buyouts, mergers and acquisitions, debt refinancing, restructurings, and working capital. The portfolio is well diversified across multiple industries including retail, manufacturing, distribution, service companies, and other specialty sectors. These specialty sectors include our Healthcare and Technology Finance verticals. The Healthcare vertical provides financing across the healthcare spectrum including services, pharmaceuticals, manufacturing, and medical devices and supplies. Our Technology Finance vertical provides financing solutions to venture capital-backed, technology-based companies. Additionally, in late in 2017, we launched a commercial real estate product focused on lending to skilled nursing facilities, senior housing, medical office buildings, and hospitals. |
• | Corporate and Other primarily consists of centralized corporate treasury activities such as management of the cash and corporate investment securities and loan portfolios, short- and long-term debt, retail and brokered deposit liabilities, derivative instruments, original issue discount, and the residual impacts of our corporate funds-transfer pricing (FTP) and treasury asset liability management (ALM) activities. Corporate and Other also includes activity related to the Ally CashBack credit card, certain equity investments, which primarily consist of Federal Home Loan Bank (FHLB) and Federal Reserve Bank (FRB) stock, the management of our legacy mortgage portfolio, which primarily consists of loans originated prior to January 1, 2009, and reclassifications and eliminations between the reportable operating segments. |
Three months ended June 30, | Six months ended June 30, | |||||||||||||||||||
($ in millions) | 2018 | 2017 | Favorable/(unfavorable) % change | 2018 | 2017 | Favorable/(unfavorable) % change | ||||||||||||||
Net financing revenue and other interest income | ||||||||||||||||||||
Total financing revenue and other interest income | $ | 2,232 | $ | 2,088 | 7 | $ | 4,348 | $ | 4,138 | 5 | ||||||||||
Total interest expense | 873 | 700 | (25) | 1,667 | 1,382 | (21) | ||||||||||||||
Net depreciation expense on operating lease assets | 265 | 321 | 17 | 538 | 710 | 24 | ||||||||||||||
Net financing revenue and other interest income | 1,094 | 1,067 | 3 | 2,143 | 2,046 | 5 | ||||||||||||||
Other revenue | ||||||||||||||||||||
Insurance premiums and service revenue earned | 239 | 227 | 5 | 495 | 468 | 6 | ||||||||||||||
Gain on mortgage and automotive loans, net | 1 | 36 | (97) | 2 | 50 | (96) | ||||||||||||||
Other gain on investments, net | 27 | 23 | 17 | 15 | 50 | (70) | ||||||||||||||
Other income, net of losses | 97 | 102 | (5) | 206 | 216 | (5) | ||||||||||||||
Total other revenue | 364 | 388 | (6) | 718 | 784 | (8) | ||||||||||||||
Total net revenue | 1,458 | 1,455 | — | 2,861 | 2,830 | 1 | ||||||||||||||
Provision for loan losses | 158 | 269 | 41 | 419 | 540 | 22 | ||||||||||||||
Noninterest expense | ||||||||||||||||||||
Compensation and benefits expense | 292 | 265 | (10) | 598 | 550 | (9) | ||||||||||||||
Insurance losses and loss adjustment expenses | 101 | 125 | 19 | 164 | 213 | 23 | ||||||||||||||
Other operating expenses | 446 | 420 | (6) | 891 | 825 | (8) | ||||||||||||||
Total noninterest expense | 839 | 810 | (4) | 1,653 | 1,588 | (4) | ||||||||||||||
Income from continuing operations before income tax expense | 461 | 376 | 23 | 789 | 702 | 12 | ||||||||||||||
Income tax expense from continuing operations | 113 | 122 | 7 | 189 | 235 | 20 | ||||||||||||||
Net income from continuing operations | $ | 348 | $ | 254 | 37 | $ | 600 | $ | 467 | 28 |
Three months ended June 30, | Six months ended June 30, | |||||||||||||||||||
($ in millions) | 2018 | 2017 | Favorable/(unfavorable) % change | 2018 | 2017 | Favorable/(unfavorable) % change | ||||||||||||||
Net financing revenue and other interest income | ||||||||||||||||||||
Consumer | $ | 1,058 | $ | 962 | 10 | $ | 2,070 | $ | 1,886 | 10 | ||||||||||
Commercial | 371 | 325 | 14 | 713 | 629 | 13 | ||||||||||||||
Operating leases | 374 | 488 | (23) | 756 | 1,031 | (27) | ||||||||||||||
Other interest income | 1 | 1 | — | 3 | 3 | — | ||||||||||||||
Total financing revenue and other interest income | 1,804 | 1,776 | 2 | 3,542 | 3,549 | — | ||||||||||||||
Interest expense | 614 | 523 | (17) | 1,170 | 1,015 | (15) | ||||||||||||||
Net depreciation expense on operating lease assets | 265 | 321 | 17 | 538 | 710 | 24 | ||||||||||||||
Net financing revenue and other interest income | 925 | 932 | (1) | 1,834 | 1,824 | 1 | ||||||||||||||
Other revenue | ||||||||||||||||||||
Gain on automotive loans, net | — | 35 | (100) | — | 59 | (100) | ||||||||||||||
Other income | 63 | 72 | (13) | 129 | 149 | (13) | ||||||||||||||
Total other revenue | 63 | 107 | (41) | 129 | 208 | (38) | ||||||||||||||
Total net revenue | 988 | 1,039 | (5) | 1,963 | 2,032 | (3) | ||||||||||||||
Provision for loan losses | 170 | 266 | 36 | 429 | 534 | 20 | ||||||||||||||
Noninterest expense | ||||||||||||||||||||
Compensation and benefits expense | 130 | 125 | (4) | 261 | 254 | (3) | ||||||||||||||
Other operating expenses | 306 | 301 | (2) | 623 | 609 | (2) | ||||||||||||||
Total noninterest expense | 436 | 426 | (2) | 884 | 863 | (2) | ||||||||||||||
Income from continuing operations before income tax expense | $ | 382 | $ | 347 | 10 | $ | 650 | $ | 635 | 2 | ||||||||||
Total assets | $ | 114,915 | $ | 115,447 | — | $ | 114,915 | $ | 115,447 | — |
Three months ended June 30, | Six months ended June 30, | |||||||||||||||||||
($ in millions) | 2018 | 2017 | Favorable/(unfavorable) % change | 2018 | 2017 | Favorable/(unfavorable) % change | ||||||||||||||
Net operating lease revenue | ||||||||||||||||||||
Operating lease revenue | $ | 374 | $ | 488 | (23) | $ | 756 | $ | 1,031 | (27) | ||||||||||
Depreciation expense | ||||||||||||||||||||
Depreciation expense on operating lease assets (excluding remarketing gains) | 281 | 353 | 20 | 572 | 739 | 23 | ||||||||||||||
Remarketing gains | (16 | ) | (32 | ) | (50) | (34 | ) | (29 | ) | 17 | ||||||||||
Net depreciation expense on operating lease assets | 265 | 321 | 17 | 538 | 710 | 24 | ||||||||||||||
Total net operating lease revenue | $ | 109 | $ | 167 | (35) | $ | 218 | $ | 321 | (32) | ||||||||||
Investment in operating leases, net | $ | 8,639 | $ | 9,717 | (11) | $ | 8,639 | $ | 9,717 | (11) |
Three months ended June 30, | Six months ended June 30, | |||||||||||||||||||||||
2018 | 2017 | 2018 | 2017 | |||||||||||||||||||||
($ in millions) | Average balance | Yield | Average balance | Yield | Average balance | Yield | Average balance | Yield | ||||||||||||||||
Finance receivables and loans, net (a) (b) | ||||||||||||||||||||||||
Consumer automotive (c) | $ | 69,941 | 6.08 | % | $ | 65,995 | 5.80 | % | $ | 69,337 | 5.99 | % | $ | 65,788 | 5.74 | % | ||||||||
Commercial | ||||||||||||||||||||||||
Wholesale floorplan | 29,309 | 4.12 | 32,832 | 3.25 | 29,334 | 3.97 | 32,650 | 3.17 | ||||||||||||||||
Other commercial automotive (d) | 6,161 | 4.56 | 5,802 | 4.15 | 6,132 | 4.44 | 5,678 | 4.12 | ||||||||||||||||
Investment in operating leases, net (e) | 8,583 | 5.09 | 10,109 | 6.63 | 8,606 | 5.11 | 10,518 | 6.15 |
(a) | Average balances are calculated using a daily average methodology. |
(b) | Nonperforming finance receivables and loans are included in the average balances. For information on our accounting policies regarding nonperforming status, refer to Note 1 to the Consolidated Financial Statements in our 2017 Annual Report on Form 10-K. |
(c) | Includes the effects of derivative financial instruments designated as hedges. |
(d) | Consists primarily of automotive dealer term loans, including those to finance dealership land and buildings, and dealer fleet financing. |
(e) | Yield includes gains on the sale of off-lease vehicles of $16 million and $34 million for three months and six months ended June 30, 2018, respectively, compared to $32 million and $29 million for the three months and six months ended June 30, 2017. Excluding these gains on sale, the annualized yield would be 4.35% and 4.31% for the three months and six months ended June 30, 2018, respectively, compared to 5.36% and 5.60% for three months and six months ended June 30, 2017. |
Used retail | New retail | |||||||||||||||||
Credit Tier (a) | Volume ($ in billions) | % Share of volume | Average FICO® | Volume ($ in billions) | % Share of volume | Average FICO® | ||||||||||||
Three months ended June 30, 2018 | ||||||||||||||||||
S | $ | 1.3 | 27 | 738 | $ | 1.6 | 46 | 746 | ||||||||||
A | 2.1 | 43 | 675 | 1.3 | 37 | 675 | ||||||||||||
B | 1.2 | 24 | 644 | 0.5 | 14 | 645 | ||||||||||||
C | 0.3 | 6 | 612 | 0.1 | 3 | 616 | ||||||||||||
Total retail originations | $ | 4.9 | 100 | 680 | $ | 3.5 | 100 | 700 | ||||||||||
Three months ended June 30, 2017 | ||||||||||||||||||
S | $ | 0.9 | 23 | 757 | $ | 1.5 | 43 | 765 | ||||||||||
A | 1.9 | 48 | 663 | 1.4 | 40 | 667 | ||||||||||||
B | 1.0 | 24 | 640 | 0.5 | 14 | 639 | ||||||||||||
C | 0.2 | 5 | 608 | 0.1 | 3 | 609 | ||||||||||||
Total retail originations | $ | 4.0 | 100 | 676 | $ | 3.5 | 100 | 698 | ||||||||||
Six months ended June 30, 2018 | ||||||||||||||||||
S | $ | 2.7 | 28 | 738 | $ | 3.4 | 48 | 747 | ||||||||||
A | 4.1 | 42 | 674 | 2.5 | 35 | 675 | ||||||||||||
B | 2.3 | 24 | 643 | 1.0 | 14 | 645 | ||||||||||||
C | 0.6 | 6 | 609 | 0.2 | 3 | 614 | ||||||||||||
Total retail originations | $ | 9.7 | 100 | 681 | $ | 7.1 | 100 | 702 | ||||||||||
Six months ended June 30, 2017 | ||||||||||||||||||
S | $ | 1.9 | 23 | 758 | $ | 3.1 | 43 | 765 | ||||||||||
A | 3.8 | 46 | 664 | 2.8 | 39 | 668 | ||||||||||||
B | 2.1 | 26 | 640 | 1.1 | 15 | 641 | ||||||||||||
C | 0.4 | 5 | 607 | 0.2 | 3 | 610 | ||||||||||||
Total retail originations | $ | 8.2 | 100 | 677 | $ | 7.2 | 100 | 700 |
(a) | Represents Ally’s internal credit score, incorporating numerous borrower and structure attributes including: severity and aging of delinquency; number of credit inquiries; loan-to-value ratio; and payment-to-income ratio. We periodically update our underwriting scorecard, which can have an impact on our credit tier scoring. We originated an insignificant amount of retail loans classified below Tier C during the periods presented. |
Three months ended June 30, | Six months ended June 30, | |||||||||||
2018 | 2017 | 2018 | 2017 | |||||||||
0–71 | 19 | % | 19 | % | 20 | % | 19 | % | ||||
72–75 | 68 | 68 | 67 | 67 | ||||||||
76 + | 13 | 13 | 13 | 14 | ||||||||
Total retail originations (a) | 100 | % | 100 | % | 100 | % | 100 | % |
(a) | Excludes RV loans. |
June 30, | 2018 | 2017 | ||||
Pre-2014 | 2 | % | 7 | % | ||
2014 | 5 | 10 | ||||
2015 | 14 | 25 | ||||
2016 | 23 | 36 | ||||
2017 | 33 | 22 | ||||
2018 | 23 | — | ||||
Total | 100 | % | 100 | % |
Consumer automotive financing originations | % Share of Ally originations | |||||||||||
Three months ended June 30, ($ in millions) | 2018 | 2017 | 2018 | 2017 | ||||||||
Used retail | $ | 4,924 | $ | 4,005 | 51 | 47 | ||||||
New retail standard | 3,365 | 3,437 | 35 | 40 | ||||||||
Lease | 1,228 | 1,115 | 13 | 13 | ||||||||
New retail subvented | 62 | 42 | 1 | — | ||||||||
Total consumer automotive financing originations (a) | $ | 9,579 | $ | 8,599 | 100 | 100 |
(a) | Includes Commercial Services Group (CSG) originations of $892 million and $874 million for the three months ended June 30, 2018, and 2017, respectively, and RV originations of $90 million and $131 million for the three months ended June 30, 2018, and 2017, respectively. |
Consumer automotive financing originations | % Share of Ally originations | ||||||||||||
Six months ended June 30, ($ in millions) | 2018 | 2017 | 2018 | 2017 | |||||||||
Used retail | $ | 9,693 | $ | 8,216 | 51 | 47 | |||||||
New retail standard | 6,971 | 7,130 | 37 | 41 | |||||||||
Lease | 2,275 | 2,039 | 12 | 12 | |||||||||
New retail subvented | 104 | 79 | — | — | |||||||||
Total consumer automotive financing originations (a) | $ | 19,043 | $ | 17,464 | 100 | 100 |
(a) | Includes CSG originations of $1.9 billion for both the six months ended June 30, 2018, and 2017, and RV originations of $190 million and $261 million for the six months ended June 30, 2018, and 2017, respectively. |
Consumer automotive financing originations | % Share of Ally originations | |||||||||||
Three months ended June 30, ($ in millions) | 2018 | 2017 | 2018 | 2017 | ||||||||
Growth channel | $ | 4,319 | $ | 3,494 | 45 | 41 | ||||||
Chrysler dealers | 2,719 | 2,563 | 28 | 30 | ||||||||
GM dealers | 2,541 | 2,542 | 27 | 29 | ||||||||
Total consumer automotive financing originations | $ | 9,579 | $ | 8,599 | 100 | 100 |
Consumer automotive financing originations | % Share of Ally originations | |||||||||||
Six months ended June 30, ($ in millions) | 2018 | 2017 | 2018 | 2017 | ||||||||
Growth channel | $ | 8,502 | $ | 6,996 | 45 | 40 | ||||||
GM dealers | 5,387 | 5,409 | 28 | 31 | ||||||||
Chrysler dealers | 5,154 | 5,059 | 27 | 29 | ||||||||
Total consumer automotive financing originations | $ | 19,043 | $ | 17,464 | 100 | 100 |
Used | New | |||||||||||
Three months ended June 30, | 2018 | 2017 | 2018 | 2017 | ||||||||
740 + | 18 | % | 17 | % | 25 | % | 26 | % | ||||
739–660 | 39 | 36 | 34 | 32 | ||||||||
659–620 | 28 | 30 | 22 | 21 | ||||||||
619–540 | 12 | 13 | 6 | 9 | ||||||||
< 540 | 1 | 2 | 1 | 1 | ||||||||
Unscored (a) | 2 | 2 | 12 | 11 | ||||||||
Total consumer automotive financing originations | 100 | % | 100 | % | 100 | % | 100 | % |
(a) | Unscored are primarily CSG contracts with entities that have no FICO® Score. |
Used | New | |||||||||||
Six months ended June 30, | 2018 | 2017 | 2018 | 2017 | ||||||||
740 + | 18 | % | 18 | % | 26 | % | 27 | % | ||||
739–660 | 38 | 36 | 34 | 32 | ||||||||
659–620 | 28 | 30 | 21 | 21 | ||||||||
619–540 | 12 | 13 | 6 | 8 | ||||||||
< 540 | 2 | 1 | 1 | 1 | ||||||||
Unscored (a) | 2 | 2 | 12 | 11 | ||||||||
Total consumer automotive financing originations | 100 | % | 100 | % | 100 | % | 100 | % |
(a) | Unscored are primarily CSG contracts with entities that have no FICO® Score. |
Average balance | Average balance | |||||||||||||||
Three months ended June 30, | Six months ended June 30, | |||||||||||||||
($ in millions) | 2018 | 2017 | 2018 | 2017 | ||||||||||||
GM new vehicles | 42 | % | 51 | % | 42 | % | 50 | % | ||||||||
Chrysler new vehicles | 31 | 25 | 30 | 25 | ||||||||||||
Growth new vehicles | 14 | 13 | 15 | 13 | ||||||||||||
Used vehicles | 13 | 11 | 13 | 12 | ||||||||||||
Total | 100 | % | 100 | % | 100 | % | 100 | % | ||||||||
Total commercial wholesale finance receivables | $ | 29,309 | $ | 32,832 | $ | 29,334 | $ | 32,650 |
Three months ended June 30, | Six months ended June 30, | |||||||||||||||||||
($ in millions) | 2018 | 2017 | Favorable/(unfavorable) % change | 2018 | 2017 | Favorable/(unfavorable) % change | ||||||||||||||
Insurance premiums and other income | ||||||||||||||||||||
Insurance premiums and service revenue earned | $ | 239 | $ | 227 | 5 | $ | 495 | $ | 468 | 6 | ||||||||||
Interest and dividends on investment securities and cash and cash equivalents, net (a) | 13 | 14 | (7) | 25 | 29 | (14) | ||||||||||||||
Other gain on investments, net (b) | 25 | 15 | 67 | 11 | 36 | (69) | ||||||||||||||
Other income | 2 | 3 | (33) | 6 | 5 | 20 | ||||||||||||||
Total insurance premiums and other income | 279 | 259 | 8 | 537 | 538 | — | ||||||||||||||
Expense | ||||||||||||||||||||
Insurance losses and loss adjustment expenses | 101 | 125 | 19 | 164 | 213 | 23 | ||||||||||||||
Acquisition and underwriting expense | ||||||||||||||||||||
Compensation and benefits expense | 18 | 18 | — | 39 | 37 | (5) | ||||||||||||||
Insurance commissions expense | 109 | 104 | (5) | 219 | 203 | (8) | ||||||||||||||
Other expenses | 40 | 33 | (21) | 77 | 66 | (17) | ||||||||||||||
Total acquisition and underwriting expense | 167 | 155 | (8) | 335 | 306 | (9) | ||||||||||||||
Total expense | 268 | 280 | 4 | 499 | 519 | 4 | ||||||||||||||
Income (loss) from continuing operations before income tax expense | $ | 11 | $ | (21 | ) | n/m | $ | 38 | $ | 19 | 100 | |||||||||
Total assets | $ | 7,634 | $ | 7,308 | 4 | $ | 7,634 | $ | 7,308 | 4 | ||||||||||
Insurance premiums and service revenue written | $ | 278 | $ | 220 | 26 | $ | 553 | $ | 460 | 20 | ||||||||||
Combined ratio (c) | 111.2 | % | 122.1 | % | 99.6 | % | 109.8 | % |
(a) | Includes interest expense of $16 million and $32 million for the three months and six months ended June 30, 2018, respectively, and $13 million and $24 million for the three months and six months ended June 30, 2017. Amounts for the three months and six months ended June 30, 2017, were adjusted to include $2 million and $3 million, respectively, of interest on cash and cash equivalents previously classified as other income to conform to the current period presentation. |
(b) | Other gain on investments for the three months ended June 30, 2018, includes unrealized gains on equity securities of $8 million. Other loss on investments for the six months ended June 30, 2018, includes unrealized losses on equity securities of $27 million. These are included in net income as a result of the adoption of Accounting Standards Update (ASU) 2016-01 on January 1, 2018. |
(c) | Management uses a combined ratio as a primary measure of underwriting profitability. Underwriting profitability is indicated by a combined ratio under 100% and is calculated as the sum of all incurred losses and expenses (excluding interest and income tax expense) divided by the total of premiums and service revenues earned and other income. |
Three months ended June 30, | Six months ended June 30, | |||||||||||||||
($ in millions) | 2018 | 2017 | 2018 | 2017 | ||||||||||||
Vehicle service contracts | ||||||||||||||||
New retail | $ | 124 | $ | 108 | $ | 231 | $ | 211 | ||||||||
Used retail | 143 | 119 | 273 | 232 | ||||||||||||
Reinsurance (a) | (42 | ) | (51 | ) | (88 | ) | (100 | ) | ||||||||
Total vehicle service contracts (b) | 225 | 176 | 416 | 343 | ||||||||||||
Vehicle inventory insurance | 27 | 20 | 89 | 72 | ||||||||||||
Other finance and insurance (c) | 26 | 24 | 48 | 45 | ||||||||||||
Total | $ | 278 | $ | 220 | $ | 553 | $ | 460 |
(a) | Reinsurance represents the transfer of premiums and risk from an Ally insurance company to a third-party insurance company. |
(b) | VSC revenue is earned over the life of the service contract on a basis proportionate to the anticipated cost pattern. Refer to the section titled Recently Adopted Accounting Standards in Note 1 to the Condensed Consolidated Financial Statements for further information regarding our adoption of the amendments to the revenue recognition principles of Accounting Standards Codification 606, Revenue from Contracts with Customers, and Note 2 to the Condensed Consolidated Financial Statements for further discussion of this revenue stream and the related impacts of adoption. |
(c) | Other finance and insurance includes GAP coverage, VMCs, ClearGuard, and other ancillary products. |
($ in millions) | June 30, 2018 | December 31, 2017 | ||||||
Cash | ||||||||
Noninterest-bearing cash | $ | 327 | $ | 298 | ||||
Interest-bearing cash | 889 | 983 | ||||||
Total cash | 1,216 | 1,281 | ||||||
Equity securities | 509 | 518 | ||||||
Available-for-sale securities | ||||||||
Debt securities | ||||||||
U.S. Treasury | 507 | 380 | ||||||
U.S. States and political subdivisions | 754 | 773 | ||||||
Foreign government | 154 | 154 | ||||||
Agency mortgage-backed residential | 634 | 613 | ||||||
Mortgage-backed residential | 152 | 174 | ||||||
Mortgage-backed commercial | 3 | 22 | ||||||
Corporate debt | 1,216 | 1,256 | ||||||
Total available-for-sale securities | 3,420 | 3,372 | ||||||
Total cash and securities | $ | 5,145 | $ | 5,171 |
Three months ended June 30, | Six months ended June 30, | |||||||||||||||||||
($ in millions) | 2018 | 2017 | Favorable/(unfavorable) % change | 2018 | 2017 | Favorable/(unfavorable) % change | ||||||||||||||
Net financing revenue and other interest income | ||||||||||||||||||||
Total financing revenue and other interest income | $ | 114 | $ | 72 | 58 | $ | 219 | $ | 143 | 53 | ||||||||||
Interest expense | 70 | 40 | (75) | 132 | 77 | (71) | ||||||||||||||
Net financing revenue and other interest income | 44 | 32 | 38 | 87 | 66 | 32 | ||||||||||||||
Gain on mortgage loans, net | 1 | 1 | — | 2 | 1 | 100 | ||||||||||||||
Other income, net of losses | 1 | — | n/m | 1 | — | n/m | ||||||||||||||
Total other revenue | 2 | 1 | 100 | 3 | 1 | n/m | ||||||||||||||
Total net revenue | 46 | 33 | 39 | 90 | 67 | 34 | ||||||||||||||
Provision for loan losses | — | 1 | 100 | 2 | 2 | — | ||||||||||||||
Noninterest expense | ||||||||||||||||||||
Compensation and benefits expense | 8 | 5 | (60) | 16 | 10 | (60) | ||||||||||||||
Other operating expenses | 24 | 20 | (20) | 50 | 39 | (28) | ||||||||||||||
Total noninterest expense | 32 | 25 | (28) | 66 | 49 | (35) | ||||||||||||||
Income from continuing operations before income tax expense | $ | 14 | $ | 7 | 100 | $ | 22 | $ | 16 | 38 | ||||||||||
Total assets | $ | 13,385 | $ | 8,902 | 50 | $ | 13,385 | $ | 8,902 | 50 |
FICO® Score | Volume ($ in millions) | % Share of volume | ||||
Three months ended June 30, 2018 | ||||||
740 + | $ | 781 | 80 | |||
720–739 | 112 | 12 | ||||
700–719 | 73 | 7 | ||||
680–699 | 7 | 1 | ||||
660–679 | 1 | — | ||||
Total consumer mortgage financing volume | $ | 974 | 100 | |||
Three months ended June 30, 2017 | ||||||
740 + | $ | 690 | 83 | |||
720–739 | 94 | 11 | ||||
700–719 | 37 | 4 | ||||
680–699 | 6 | 1 | ||||
660–679 | 4 | 1 | ||||
Total consumer mortgage financing volume | $ | 831 | 100 | |||
Six months ended June 30, 2018 | ||||||
740 + | $ | 1,875 | 79 | |||
720–739 | 244 | 10 | ||||
700–719 | 178 | 8 | ||||
680–699 | 62 | 3 | ||||
660–679 | 1 | — | ||||
Total consumer mortgage financing volume | $ | 2,360 | 100 | |||
Six months ended June 30, 2017 | ||||||
740 + | $ | 956 | 83 | |||
720–739 | 128 | 11 | ||||
700–719 | 57 | 5 | ||||
680–699 | 11 | 1 | ||||
660–679 | 6 | — | ||||
Total consumer mortgage financing volume | $ | 1,158 | 100 |
Product | Net UPB (a) ($ in millions) | % of total net UPB | WAC | Net premium ($ in millions) | Average refreshed LTV (b) | Average refreshed FICO® (c) | |||||||||||||
June 30, 2018 | |||||||||||||||||||
Adjustable-rate | $ | 2,831 | 22 | 3.37 | % | $ | 41 | 56.19 | % | 773 | |||||||||
Fixed-rate | 10,222 | 78 | 4.05 | 234 | 61.27 | 772 | |||||||||||||
Total | $ | 13,053 | 100 | 3.90 | $ | 275 | 60.16 | 772 | |||||||||||
December 31, 2017 | |||||||||||||||||||
Adjustable-rate | $ | 2,579 | 23 | 3.35 | % | $ | 42 | 56.82 | % | 774 | |||||||||
Fixed-rate | 8,824 | 77 | 4.02 | 212 | 62.02 | 771 | |||||||||||||
Total | $ | 11,403 | 100 | 3.87 | $ | 254 | 60.84 | 772 |
(a) | Represents UPB net of charge-offs. |
(b) | Updated home values were derived using a combination of appraisals, broker price opinions, automated valuation models, and metropolitan statistical area level house price indices. |
(c) | Updated to reflect changes in credit score since loan origination. |
Three months ended June 30, | Six months ended June 30, | |||||||||||||||||||
($ in millions) | 2018 | 2017 | Favorable/(unfavorable) % change | 2018 | 2017 | Favorable/(unfavorable) % change | ||||||||||||||
Net financing revenue and other interest income | ||||||||||||||||||||
Interest and fees on finance receivables and loans | $ | 84 | $ | 70 | 20 | $ | 158 | $ | 124 | 27 | ||||||||||
Interest on loans held-for-sale | 5 | — | n/m | 5 | — | n/m | ||||||||||||||
Interest expense | 32 | 22 | (45) | 60 | 42 | (43) | ||||||||||||||
Net financing revenue and other interest income | 57 | 48 | 19 | 103 | 82 | 26 | ||||||||||||||
Total other revenue | 14 | 10 | 40 | 22 | 28 | (21) | ||||||||||||||
Total net revenue | 71 | 58 | 22 | 125 | 110 | 14 | ||||||||||||||
Provision for loan losses | (6 | ) | 6 | n/m | (6 | ) | 12 | 150 | ||||||||||||
Noninterest expense | ||||||||||||||||||||
Compensation and benefits expense | 12 | 10 | (20) | 27 | 24 | (13) | ||||||||||||||
Other operating expenses | 7 | 7 | — | 17 | 14 | (21) | ||||||||||||||
Total noninterest expense | 19 | 17 | (12) | 44 | 38 | (16) | ||||||||||||||
Income from continuing operations before income tax expense | $ | 58 | $ | 35 | 66 | $ | 87 | $ | 60 | 45 | ||||||||||
Total assets | $ | 4,458 | $ | 3,552 | 26 | $ | 4,458 | $ | 3,552 | 26 |
($ in millions) | June 30, 2018 | December 31, 2017 | ||||||
Loans held-for-sale, net | $ | 275 | $ | 77 | ||||
Finance receivables and loans | 4,184 | 3,910 | ||||||
Unfunded lending commitments (a) | 2,146 | 1,813 |
(a) | Includes unused revolving credit line commitments for loans held-for-sale and finance receivables and loans, signed commitment letters, and standby letter of credit facilities, which are issued on behalf of clients and may contingently require us to make payments to a third-party beneficiary should the client fail to fulfill a contractual commitment. As many of these commitments are subject to borrowing base agreements and other restrictive covenants or may expire without being fully drawn, the contract amounts are not necessarily indicative of future cash requirements. |
June 30, 2018 | December 31, 2017 | |||||
Industry | ||||||
Services | 31.8 | % | 31.0 | % | ||
Health services | 14.2 | 15.6 | ||||
Automotive and transportation | 13.2 | 10.3 | ||||
Wholesale | 8.4 | 8.7 | ||||
Food and beverages | 6.0 | 4.1 | ||||
Other manufactured products | 5.9 | 7.1 | ||||
Chemicals and metals | 5.7 | 5.0 | ||||
Machinery, equipment, and electronics | 5.0 | 7.9 | ||||
Retail trade | 2.8 | 2.6 | ||||
Paper, printing, and publishing | 2.5 | 3.0 | ||||
Other | 4.5 | 4.7 | ||||
Total finance receivables and loans | 100.0 | % | 100.0 | % |
Three months ended June 30, | Six months ended June 30, | |||||||||||||||||||
($ in millions) | 2018 | 2017 | Favorable/(unfavorable) % change | 2018 | 2017 | Favorable/(unfavorable) % change | ||||||||||||||
Net financing revenue and other interest income | ||||||||||||||||||||
Interest and fees on finance receivables and loans (a) | $ | 21 | $ | 19 | 11 | $ | 31 | $ | 34 | (9) | ||||||||||
Interest on loans held-for-sale | 1 | — | n/m | 1 | — | n/m | ||||||||||||||
Interest and dividends on investment securities and other earning assets | 162 | 121 | 34 | 312 | 230 | 36 | ||||||||||||||
Interest on cash and cash equivalents | 14 | 5 | 180 | 27 | 9 | n/m | ||||||||||||||
Other, net | (2 | ) | (2 | ) | — | (4 | ) | (4 | ) | — | ||||||||||
Total financing revenue and other interest income | 196 | 143 | 37 | 367 | 269 | 36 | ||||||||||||||
Interest expense | ||||||||||||||||||||
Original issue discount amortization (b) | 25 | 22 | (14) | 49 | 43 | (14) | ||||||||||||||
Other interest expense (c) | 116 | 80 | (45) | 224 | 181 | (24) | ||||||||||||||
Total interest expense | 141 | 102 | (38) | 273 | 224 | (22) | ||||||||||||||
Net financing revenue and other interest income | 55 | 41 | 34 | 94 | 45 | 109 | ||||||||||||||
Other revenue | ||||||||||||||||||||
Loss on mortgage and automotive loans, net | — | — | — | — | (10 | ) | 100 | |||||||||||||
Other gain on investments, net | 1 | 8 | (88) | 7 | 14 | (50) | ||||||||||||||
Other income, net of losses | 18 | 17 | 6 | 45 | 34 | 32 | ||||||||||||||
Total other revenue | 19 | 25 | (24) | 52 | 38 | 37 | ||||||||||||||
Total net revenue | 74 | 66 | 12 | 146 | 83 | 76 | ||||||||||||||
Provision for loan losses | (6 | ) | (4 | ) | 50 | (6 | ) | (8 | ) | (25) | ||||||||||
Total noninterest expense (d) | 84 | 62 | (35) | 160 | 119 | (34) | ||||||||||||||
(Loss) income from continuing operations before income tax expense | $ | (4 | ) | $ | 8 | (150) | $ | (8 | ) | $ | (28 | ) | 71 | |||||||
Total assets | $ | 30,953 | $ | 29,136 | 6 | $ | 30,953 | $ | 29,136 | 6 |
(a) | Primarily related to financing revenue from our legacy mortgage portfolio and impacts related to hedging activities associated with our consumer automotive loan portfolio. |
(b) | Amortization is included as interest on long-term debt in the Condensed Consolidated Statement of Comprehensive Income. |
(c) | Includes the residual impacts of our FTP methodology and impacts of hedging activities of certain debt obligations. |
(d) | Includes reductions of $206 million and $426 million for the three months and six months ended June 30, 2018, respectively, and $200 million and $412 million for the three months and six months ended June 30, 2017, related to the allocation of corporate overhead expenses to other segments. The receiving segments record their allocation of corporate overhead expense within other operating expense. |
Year ended December 31, ($ in millions) | 2018 | 2019 | 2020 | 2021 | 2022 | 2023 and thereafter (a) | Total | |||||||||||||||||||||
Original issue discount | ||||||||||||||||||||||||||||
Outstanding balance at year end | $ | 1,135 | $ | 1,097 | $ | 1,058 | $ | 1,015 | $ | 968 | $ | — | ||||||||||||||||
Total amortization (b) | 52 | 38 | 39 | 43 | 47 | 968 | $ | 1,187 |
(a) | The maximum annual scheduled amortization for any individual year is $153 million in 2030. |
(b) | The amortization is included as interest on long-term debt in the Condensed Consolidated Statement of Comprehensive Income. |
($ in millions) | June 30, 2018 | December 31, 2017 | ||||||
Cash | ||||||||
Noninterest-bearing cash | $ | 449 | $ | 523 | ||||
Interest-bearing cash | 2,236 | 2,425 | ||||||
Total cash | 2,685 | 2,948 | ||||||
Available-for-sale securities | ||||||||
Debt securities | ||||||||
U.S. Treasury | 1,367 | 1,397 | ||||||
U.S. States and political subdivisions | 97 | 81 | ||||||
Agency mortgage-backed residential | 14,432 | 13,678 | ||||||
Mortgage-backed residential | 2,473 | 2,320 | ||||||
Mortgage-backed commercial | 639 | 519 | ||||||
Asset-backed | 868 | 936 | ||||||
Total available-for-sale securities | 19,876 | 18,931 | ||||||
Held-to-maturity securities | ||||||||
Debt securities | ||||||||
Agency mortgage-backed residential | 1,980 | 1,829 | ||||||
Asset-backed retained notes | 27 | 36 | ||||||
Total held-to-maturity securities | 2,007 | 1,865 | ||||||
Total cash and securities | $ | 24,568 | $ | 23,744 |
2nd quarter 2018 | 1st quarter 2018 | 4th quarter 2017 | 3rd quarter 2017 | 2nd quarter 2017 | 1st quarter 2017 | |||||||||||||
Trading days (a) | 64.0 | 61.0 | 62.5 | 62.5 | 63.0 | 62.0 | ||||||||||||
Average customer trades per day (in thousands) | 18.0 | 21.8 | 16.8 | 15.5 | 16.5 | 19.0 | ||||||||||||
Funded accounts (b) (in thousands) | 271 | 259 | 245 | 239 | 234 | 235 | ||||||||||||
Total net customer assets ($ in millions) | $ | 5,990 | $ | 5,473 | $ | 5,354 | $ | 5,203 | $ | 5,006 | $ | 4,984 | ||||||
Total customer cash balances ($ in millions) | $ | 1,166 | $ | 1,111 | $ | 1,144 | $ | 1,168 | $ | 1,154 | $ | 1,233 |
(a) | Represents the number of days the New York Stock Exchange and other U.S. stock exchange markets are open for trading. A half day represents a day when the U.S. markets close early. |
(b) | Represents open and funded brokerage accounts. |
• | Business lines — Responsible for owning and managing all of the risks that emanate from their risk-taking activities, including business units and support functions. |
• | Independent risk management — Responsible for establishing and maintaining our risk management framework and promulgating it enterprise-wide. Independent risk management also provides an objective, critical assessment of risks and—through oversight, effective challenge, and other means—evaluates whether Ally remains aligned with its risk appetite. |
• | Internal audit — Provides its own independent assessments of the effectiveness of our risk management, internal controls, and governance; and independent assessments regarding the quality of our loan portfolios. Internal audit includes Audit Services and the Loan Review Group. |
• | Credit risk — The risk of loss arising from an obligor not meeting its contractual obligations to us. |
• | Insurance/underwriting risk — The risk of loss or of adverse change in the value of insurance liabilities, due to inadequate pricing and provisioning assumptions. |
• | Liquidity risk — The risk that our financial condition or overall safety and soundness is adversely affected by the actual or perceived inability to liquidate assets or obtain adequate funding or to easily unwind or offset specific exposures without significantly lowering market prices because of inadequate market depth or market disruptions. Refer to discussion in the section titled Liquidity Management, Funding, and Regulatory Capital within this MD&A. |
• | Market risk — The risk of loss arising from changes in the value of our assets or liabilities (including derivatives) caused by movements in market variables such as interest rates, foreign-exchange rates, and equity and commodity prices. Market risk includes interest rate risk, investment risk, and lease residual risk. |
• | Business/strategic risk — The risk resulting from the pursuit of business plans that turn out to be unsuccessful due to a variety of factors. |
• | Reputation risk — The risk arising from negative public opinion on our business practices, whether true or not, that will cause a decline in the customer base, litigation, or revenue reductions. |
• | Operational risk — The risk of loss or harm arising from inadequate or failed processes or systems, human factors, or external events. |
• | Information technology/security risk — The risk resulting from the failure of, or insufficiency in, information technology (e.g., system outage) or intentional or accidental unauthorized access, sharing, removal, tampering, or disposal of company and customer data or records. |
• | Compliance risk — The risk arising from potential violations of or nonconformance with applicable laws (including statutes, rules, regulations, and case law), prescribed compliance practices, specific internal compliance policies, standards, and procedures designed to facilitate compliance with legal or ethical standards, or principles of fair and ethical customer treatment. Compliance risk also arises in situations where applicable laws may change or are ambiguous or untested. |
• | Conduct risk — The risk of customer harm, employee harm, reputational damage, regulatory sanction, or financial loss resulting from the behavior of our employees and contractors toward customers, counterparties, other employees and contractors, or the markets in which we operate. |
($ in millions) | June 30, 2018 | December 31, 2017 | ||||||
Finance receivables and loans | ||||||||
Automotive Finance | $ | 106,118 | $ | 105,129 | ||||
Mortgage Finance | 13,328 | 11,657 | ||||||
Corporate Finance | 4,184 | 3,910 | ||||||
Corporate and Other (a) | 1,914 | 2,197 | ||||||
Total finance receivables and loans | 125,544 | 122,893 | ||||||
Loans held-for-sale | ||||||||
Mortgage Finance (b) | 13 | 13 | ||||||
Corporate Finance | 275 | 77 | ||||||
Corporate and Other | 40 | 18 | ||||||
Total loans held-for-sale | 328 | 108 | ||||||
Total on-balance sheet loans | 125,872 | 123,001 | ||||||
Off-balance sheet securitized loans | ||||||||
Automotive Finance (c) | 1,388 | 1,964 | ||||||
Whole-loan sales | ||||||||
Automotive Finance (c) | 964 | 1,399 | ||||||
Total off-balance sheet loans | 2,352 | 3,363 | ||||||
Operating lease assets | ||||||||
Automotive Finance | 8,639 | 8,741 | ||||||
Total loan and lease exposure | $ | 136,863 | $ | 135,105 | ||||
Serviced loans and leases | ||||||||
Automotive Finance | $ | 116,431 | $ | 116,878 | ||||
Mortgage Finance | 13,328 | 11,670 | ||||||
Corporate Finance | 5,069 | 3,893 | ||||||
Corporate and Other | 1,803 | 2,093 | ||||||
Total serviced loans and leases | $ | 136,631 | $ | 134,534 |
(a) | Includes $1.8 billion and $2.1 billion of consumer mortgage loans in our legacy mortgage portfolio at June 30, 2018, and December 31, 2017, respectively. |
(b) | Represents the current balance of conforming mortgages originated directly to the held-for-sale portfolio. |
(c) | Represents the current unpaid principal balance of outstanding loans based on our customary representation and warranty provisions. |
Outstanding | Nonperforming (a) | Accruing past due 90 days or more | ||||||||||||||||||||||
($ in millions) | June 30, 2018 | December 31, 2017 | June 30, 2018 | December 31, 2017 | June 30, 2018 | December 31, 2017 | ||||||||||||||||||
Consumer | ||||||||||||||||||||||||
Finance receivables and loans | ||||||||||||||||||||||||
Loans at gross carrying value | $ | 85,604 | $ | 81,821 | $ | 707 | $ | 720 | $ | — | $ | — | ||||||||||||
Loans held-for-sale | 13 | 13 | — | — | — | — | ||||||||||||||||||
Total consumer loans (b) | 85,617 | 81,834 | 707 | 720 | — | — | ||||||||||||||||||
Commercial | ||||||||||||||||||||||||
Finance receivables and loans | ||||||||||||||||||||||||
Loans at gross carrying value | 39,940 | 41,072 | 198 | 72 | — | — | ||||||||||||||||||
Loans held-for-sale | 315 | 95 | — | — | — | — | ||||||||||||||||||
Total commercial loans | 40,255 | 41,167 | 198 | 72 | — | — | ||||||||||||||||||
Total on-balance sheet loans | $ | 125,872 | $ | 123,001 | $ | 905 | $ | 792 | $ | — | $ | — |
(a) | Includes nonaccrual TDR loans of $336 million and $270 million at June 30, 2018, and December 31, 2017, respectively. |
(b) | Includes outstanding CSG loans of $7.5 billion and $7.3 billion at June 30, 2018, and December 31, 2017, respectively, and RV loans of $1.8 billion at both June 30, 2018, and December 31, 2017. |
Three months ended June 30, | Six months ended June 30, | |||||||||||||||||||||||||||
Net charge-offs (recoveries) | Net charge-off ratios (a) | Net charge-offs (recoveries) | Net charge-off ratios (a) | |||||||||||||||||||||||||
($ in millions) | 2018 | 2017 | 2018 | 2017 | 2018 | 2017 | 2018 | 2017 | ||||||||||||||||||||
Consumer | $ | 184 | $ | 199 | 0.9 | % | 1.0 | % | $ | 443 | $ | 452 | 1.1 | % | 1.2 | % | ||||||||||||
Commercial | (4 | ) | — | — | — | (4 | ) | — | — | — | ||||||||||||||||||
Total finance receivables and loans at gross carrying value | $ | 180 | $ | 199 | 0.6 | 0.7 | $ | 439 | $ | 452 | 0.7 | 0.8 |
(a) | Net charge-off ratios are calculated as annualized net charge-offs divided by average outstanding finance receivables and loans excluding loans measured at fair value and loans held-for-sale during the period for each loan category. |
Outstanding | Nonperforming (a) | Accruing past due 90 days or more | ||||||||||||||||||||||
($ in millions) | June 30, 2018 | December 31, 2017 | June 30, 2018 | December 31, 2017 | June 30, 2018 | December 31, 2017 | ||||||||||||||||||
Consumer automotive (b) (c) | $ | 70,473 | $ | 68,071 | $ | 602 | $ | 603 | $ | — | $ | — | ||||||||||||
Consumer mortgage | ||||||||||||||||||||||||
Mortgage Finance | 13,328 | 11,657 | 18 | 25 | — | — | ||||||||||||||||||
Mortgage — Legacy | 1,803 | 2,093 | 87 | 92 | — | — | ||||||||||||||||||
Total consumer finance receivables and loans | $ | 85,604 | $ | 81,821 | $ | 707 | $ | 720 | $ | — | $ | — |
(a) | Includes nonaccrual TDR loans of $253 million and $219 million at June 30, 2018, and December 31, 2017, respectively. |
(b) | Certain finance receivables and loans are included in fair value hedging relationships. Refer to Note 18 to the Condensed Consolidated Financial Statements for additional information. |
(c) | Includes outstanding CSG loans of $7.5 billion and $7.3 billion at June 30, 2018, and December 31, 2017, respectively, and RV loans of $1.8 billion at both June 30, 2018, and December 31, 2017. |
Three months ended June 30, | Six months ended June 30, | |||||||||||||||||||||||||||
Net charge-offs | Net charge-off ratios (a) | Net charge-offs | Net charge-off ratios (a) | |||||||||||||||||||||||||
($ in millions) | 2018 | 2017 | 2018 | 2017 | 2018 | 2017 | 2018 | 2017 | ||||||||||||||||||||
Consumer automotive | $ | 182 | $ | 199 | 1.0 | % | 1.2 | % | $ | 435 | $ | 450 | 1.3 | % | 1.4 | % | ||||||||||||
Consumer mortgage | ||||||||||||||||||||||||||||
Mortgage Finance | 1 | — | — | — | 2 | — | — | — | ||||||||||||||||||||
Mortgage — Legacy | 1 | — | 0.2 | — | 6 | 2 | 0.6 | 0.1 | ||||||||||||||||||||
Total consumer finance receivables and loans | $ | 184 | $ | 199 | 0.9 | 1.0 | $ | 443 | $ | 452 | 1.1 | 1.2 |
(a) | Net charge-off ratios are calculated as annualized net charge-offs divided by average outstanding finance receivables and loans excluding loans measured at fair value and loans held-for-sale during the period for each loan category. |
Three months ended June 30, | Six months ended June 30, | |||||||||||||||
($ in millions) | 2018 | 2017 | 2018 | 2017 | ||||||||||||
Consumer automotive | $ | 8,351 | $ | 7,484 | $ | 16,768 | $ | 15,425 | ||||||||
Consumer mortgage (a) | 194 | 41 | 345 | 44 | ||||||||||||
Total consumer loan originations | $ | 8,545 | $ | 7,525 | $ | 17,113 | $ | 15,469 |
(a) | Excludes bulk loan purchases associated with our Mortgage Finance operations and includes $72 million and $132 million of loans originated as held-for-sale for the three months and six months ended June 30, 2018, and $20 million and $23 million for the three months and six months ended June 30, 2017. |
June 30, 2018 (a) | December 31, 2017 | |||||||||||
Consumer automotive | Consumer mortgage | Consumer automotive | Consumer mortgage | |||||||||
California | 8.3 | % | 36.3 | % | 8.2 | % | 34.6 | % | ||||
Texas | 13.0 | 6.2 | 13.2 | 6.5 | ||||||||
Florida | 8.7 | 4.7 | 8.5 | 4.8 | ||||||||
Illinois | 4.1 | 3.2 | 4.2 | 3.2 | ||||||||
Pennsylvania | 4.5 | 1.4 | 4.6 | 1.5 | ||||||||
Georgia | 4.2 | 2.6 | 4.2 | 2.5 | ||||||||
North Carolina | 3.8 | 1.7 | 3.7 | 1.8 | ||||||||
New York | 3.0 | 2.4 | 3.0 | 2.2 | ||||||||
Ohio | 3.5 | 0.4 | 3.4 | 0.5 | ||||||||
New Jersey | 2.6 | 2.1 | 2.6 | 2.1 | ||||||||
Other United States | 44.3 | 39.0 | 44.4 | 40.3 | ||||||||
Total consumer loans | 100.0 | % | 100.0 | % | 100.0 | % | 100.0 | % |
(a) | Presentation is in descending order as a percentage of total consumer finance receivables and loans at June 30, 2018. |
Outstanding | Nonperforming (a) | Accruing past due 90 days or more | ||||||||||||||||||||||
($ in millions) | June 30, 2018 | December 31, 2017 | June 30, 2018 | December 31, 2017 | June 30, 2018 | December 31, 2017 | ||||||||||||||||||
Commercial and industrial | ||||||||||||||||||||||||
Automotive | $ | 31,501 | $ | 33,025 | $ | 88 | $ | 27 | $ | — | $ | — | ||||||||||||
Other (b) | 4,027 | 3,887 | 104 | 44 | — | — | ||||||||||||||||||
Commercial real estate | 4,412 | 4,160 | 6 | 1 | — | — | ||||||||||||||||||
Total commercial finance receivables and loans | $ | 39,940 | $ | 41,072 | $ | 198 | $ | 72 | $ | — | $ | — |
(a) | Includes nonaccrual TDR loans of $83 million and $51 million at June 30, 2018, and December 31, 2017, respectively. |
(b) | Other commercial primarily includes senior secured commercial lending largely associated with our Corporate Finance operations. |
Three months ended June 30, | Six months ended June 30, | |||||||||||||||||||||||||||
Net charge-offs (recoveries) | Net charge-off ratios (a) | Net charge-offs (recoveries) | Net charge-off ratios (a) | |||||||||||||||||||||||||
($ in millions) | 2018 | 2017 | 2018 | 2017 | 2018 | 2017 | 2018 | 2017 | ||||||||||||||||||||
Commercial and industrial | ||||||||||||||||||||||||||||
Automotive | $ | 2 | $ | — | — | % | — | % | $ | 2 | $ | — | — | % | — | % | ||||||||||||
Other | (6 | ) | — | (0.5 | ) | — | (6 | ) | — | (0.3 | ) | — | ||||||||||||||||
Total commercial finance receivables and loans | $ | (4 | ) | $ | — | — | — | $ | (4 | ) | $ | — | — | — |
(a) | Net charge-off ratios are calculated as annualized net charge-offs divided by average outstanding finance receivables and loans excluding loans measured at fair value and loans held-for-sale during the period for each loan category. |
June 30, 2018 | December 31, 2017 | |||||
Texas | 16.2 | % | 15.7 | % | ||
Florida | 11.8 | 10.3 | ||||
California | 9.3 | 8.2 | ||||
Michigan | 7.0 | 7.7 | ||||
Georgia | 4.4 | 4.6 | ||||
North Carolina | 3.8 | 3.6 | ||||
New Jersey | 3.3 | 3.6 | ||||
South Carolina | 3.3 | 3.5 | ||||
Missouri | 2.6 | 2.4 | ||||
Pennsylvania | 2.4 | 3.0 | ||||
Other United States | 35.9 | 37.4 | ||||
Total commercial real estate finance receivables and loans | 100.0 | % | 100.0 | % |
June 30, 2018 | December 31, 2017 | |||||
Industry | ||||||
Automotive | 81.2 | % | 76.3 | % | ||
Services | 5.6 | 6.7 | ||||
Health/Medical | 4.9 | 4.9 | ||||
Other | 8.3 | 12.1 | ||||
Total commercial criticized finance receivables and loans | 100.0 | % | 100.0 | % |
Three months ended June 30, 2018 ($ in millions) | Consumer automotive | Consumer mortgage | Total consumer | Commercial | Total | |||||||||||||||
Allowance at April 1, 2018 | $ | 1,066 | $ | 74 | $ | 1,140 | $ | 138 | $ | 1,278 | ||||||||||
Charge-offs (a) | (296 | ) | (8 | ) | (304 | ) | (2 | ) | (306 | ) | ||||||||||
Recoveries | 114 | 6 | 120 | 6 | 126 | |||||||||||||||
Net charge-offs | (182 | ) | (2 | ) | (184 | ) | 4 | (180 | ) | |||||||||||
Provision for loan losses | 168 | (4 | ) | 164 | (6 | ) | 158 | |||||||||||||
Other | 1 | (2 | ) | (1 | ) | 2 | 1 | |||||||||||||
Allowance at June 30, 2018 | $ | 1,053 | $ | 66 | $ | 1,119 | $ | 138 | $ | 1,257 | ||||||||||
Allowance for loan losses to finance receivables and loans outstanding at June 30, 2018 (b) | 1.5 | % | 0.4 | % | 1.3 | % | 0.3 | % | 1.0 | % | ||||||||||
Net charge-offs to average finance receivables and loans outstanding for the three months ended June 30, 2018 | 1.0 | % | — | % | 0.9 | % | — | % | 0.6 | % | ||||||||||
Allowance for loan losses to total nonperforming finance receivables and loans at June 30, 2018 (b) | 175.0 | % | 63.2 | % | 158.4 | % | 69.5 | % | 138.9 | % | ||||||||||
Ratio of allowance for loan losses to annualized net charge-offs at June 30, 2018 | 1.4 | 10.7 | 1.5 | n/m | 1.8 |
(a) | Represents the amount of the gross carrying value directly written off. For consumer and commercial loans, the loss from a charge-off is measured as the difference between the gross carrying value of a loan and the fair value of the collateral, less costs to sell. Refer to Note 1 to the Consolidated Financial Statements in our 2017 Annual Report on Form 10-K for more information regarding our charge-off policies. |
(b) | Coverage percentages are based on the allowance for loan losses related to finance receivables and loans excluding those loans held at fair value as a percentage of the gross carrying value. |
Three months ended June 30, 2017 ($ in millions) | Consumer automotive | Consumer mortgage | Total consumer | Commercial | Total | |||||||||||||||
Allowance at April 1, 2017 | $ | 941 | $ | 86 | $ | 1,027 | $ | 128 | $ | 1,155 | ||||||||||
Charge-offs (a) | (290 | ) | (6 | ) | (296 | ) | — | (296 | ) | |||||||||||
Recoveries | 91 | 6 | 97 | — | 97 | |||||||||||||||
Net charge-offs | (199 | ) | — | (199 | ) | — | (199 | ) | ||||||||||||
Provision for loan losses | 260 | (3 | ) | 257 | 12 | 269 | ||||||||||||||
Allowance at June 30, 2017 | $ | 1,002 | $ | 83 | $ | 1,085 | $ | 140 | $ | 1,225 | ||||||||||
Allowance for loan losses to finance receivables and loans outstanding at June 30, 2017 (b) | 1.5 | % | 0.7 | % | 1.4 | % | 0.3 | % | 1.0 | % | ||||||||||
Net charge-offs to average finance receivables and loans outstanding for the three months ended June 30, 2017 | 1.2 | % | — | % | 1.0 | % | — | % | 0.7 | % | ||||||||||
Allowance for loan losses to total nonperforming finance receivables and loans at June 30, 2017 (b) | 185.6 | % | 89.6 | % | 171.6 | % | 92.5 | % | 156.3 | % | ||||||||||
Ratio of allowance for loan losses to annualized net charge-offs at June 30, 2017 | 1.3 | n/m | 1.4 | n/m | 1.5 |
(a) | Represents the amount of the gross carrying value directly written off. For consumer and commercial loans, the loss from a charge-off is measured as the difference between the gross carrying value of a loan and the fair value of the collateral, less costs to sell. Refer to Note 1 to the Consolidated Financial Statements in our 2017 Annual Report on Form 10-K for more information regarding our charge-off policies. |
(b) | Coverage percentages are based on the allowance for loan losses related to finance receivables and loans excluding those loans held at fair value as a percentage of the gross carrying value. |
Six months ended June 30, 2018 ($ in millions) | Consumer automotive | Consumer mortgage | Total consumer | Commercial | Total | |||||||||||||||
Allowance at January 1, 2018 | $ | 1,066 | $ | 79 | $ | 1,145 | $ | 131 | $ | 1,276 | ||||||||||
Charge-offs (a) | (661 | ) | (20 | ) | (681 | ) | (2 | ) | (683 | ) | ||||||||||
Recoveries | 226 | 12 | 238 | 6 | 244 | |||||||||||||||
Net charge-offs | (435 | ) | (8 | ) | (443 | ) | 4 | (439 | ) | |||||||||||
Provision for loan losses | 421 | (3 | ) | 418 | 1 | 419 | ||||||||||||||
Other | 1 | (2 | ) | (1 | ) | 2 | 1 | |||||||||||||
Allowance at June 30, 2018 | $ | 1,053 | $ | 66 | $ | 1,119 | $ | 138 | $ | 1,257 | ||||||||||
Allowance for loan losses to finance receivables and loans outstanding at June 30, 2018 (b) | 1.5 | % | 0.4 | % | 1.3 | % | 0.3 | % | 1.0 | % | ||||||||||
Net charge-offs to average finance receivables and loans outstanding for the six months ended June 30, 2018 | 1.3 | % | 0.1 | % | 1.1 | % | — | % | 0.7 | % | ||||||||||
Allowance for loan losses to total nonperforming finance receivables and loans at June 30, 2018 (b) | 175.0 | % | 63.2 | % | 158.4 | % | 69.5 | % | 138.9 | % | ||||||||||
Ratio of allowance for loan losses to annualized net charge-offs at June 30, 2018 | 1.2 | 4.2 | 1.3 | n/m | 1.4 |
(a) | Represents the amount of the gross carrying value directly written off. For consumer and commercial loans, the loss from a charge-off is measured as the difference between the gross carrying value of a loan and the fair value of the collateral, less costs to sell. Refer to Note 1 to the Consolidated Financial Statements in our 2017 Annual Report on Form 10-K for more information regarding our charge-off policies. |
(b) | Coverage percentages are based on the allowance for loan losses related to finance receivables and loans excluding those loans held at fair value as a percentage of the gross carrying value. |
Six months ended June 30, 2017 ($ in millions) | Consumer automotive | Consumer mortgage | Total consumer | Commercial | Total | |||||||||||||||
Allowance at January 1, 2017 | $ | 932 | $ | 91 | $ | 1,023 | $ | 121 | $ | 1,144 | ||||||||||
Charge-offs (a) | (631 | ) | (15 | ) | (646 | ) | — | (646 | ) | |||||||||||
Recoveries | 181 | 13 | 194 | — | 194 | |||||||||||||||
Net charge-offs | (450 | ) | (2 | ) | (452 | ) | — | (452 | ) | |||||||||||
Provision for loan losses | 527 | (6 | ) | 521 | 19 | 540 | ||||||||||||||
Other (b) | (7 | ) | — | (7 | ) | — | (7 | ) | ||||||||||||
Allowance at June 30, 2017 | $ | 1,002 | $ | 83 | $ | 1,085 | $ | 140 | $ | 1,225 | ||||||||||
Allowance for loan losses to finance receivables and loans outstanding at June 30, 2017 (c) | 1.5 | % | 0.7 | % | 1.4 | % | 0.3 | % | 1.0 | % | ||||||||||
Net charge-offs to average finance receivables and loans outstanding for the six months ended June 30, 2017 | 1.4 | % | — | % | 1.2 | % | — | % | 0.8 | % | ||||||||||
Allowance for loan losses to total nonperforming finance receivables and loans at June 30, 2017 (c) | 185.6 | % | 89.6 | % | 171.6 | % | 92.5 | % | 156.3 | % | ||||||||||
Ratio of allowance for loan losses to annualized net charge-offs at June 30, 2017 | 1.1 | 17.3 | 1.2 | n/m | 1.4 |
(a) | Represents the amount of the gross carrying value directly written off. For consumer and commercial loans, the loss from a charge-off is measured as the difference between the gross carrying value of a loan and the fair value of the collateral, less costs to sell. Refer to Note 1 to the Consolidated Financial Statements in our 2017 Annual Report on Form 10-K for more information regarding our charge-off policies. |
(b) | Primarily related to the transfer of finance receivables and loans from held-for-investment to held-for-sale. |
(c) | Coverage percentages are based on the allowance for loan losses related to finance receivables and loans excluding those loans held at fair value as a percentage of the gross carrying value. |
2018 | 2017 | |||||||||||||||||||
June 30, ($ in millions) | Allowance for loan losses | Allowance as a % of loans outstanding | Allowance as a % of total allowance for loan losses | Allowance for loan losses | Allowance as a % of loans outstanding | Allowance as a % of total allowance for loan losses | ||||||||||||||
Consumer | ||||||||||||||||||||
Consumer automotive | $ | 1,053 | 1.5 | % | 83.7 | % | $ | 1,002 | 1.5 | % | 81.8 | % | ||||||||
Consumer mortgage | ||||||||||||||||||||
Mortgage Finance | 18 | 0.1 | 1.5 | 12 | 0.1 | 1.0 | ||||||||||||||
Mortgage — Legacy | 48 | 2.7 | 3.8 | 71 | 2.9 | 5.8 | ||||||||||||||
Total consumer mortgage | 66 | 0.4 | 5.3 | 83 | 0.7 | 6.8 | ||||||||||||||
Total consumer loans | 1,119 | 1.3 | 89.0 | 1,085 | 1.4 | 88.6 | ||||||||||||||
Commercial | ||||||||||||||||||||
Commercial and industrial | ||||||||||||||||||||
Automotive | 42 | 0.1 | 3.4 | 38 | 0.1 | 3.1 | ||||||||||||||
Other | 69 | 1.7 | 5.5 | 76 | 2.1 | 6.2 | ||||||||||||||
Commercial real estate | 27 | 0.6 | 2.1 | 26 | 0.6 | 2.1 | ||||||||||||||
Total commercial loans | 138 | 0.3 | 11.0 | 140 | 0.3 | 11.4 | ||||||||||||||
Total allowance for loan losses | $ | 1,257 | 1.0 | 100.0 | % | $ | 1,225 | 1.0 | 100.0 | % |
Three months ended June 30, | Six months ended June 30, | |||||||||||||||
($ in millions) | 2018 | 2017 | 2018 | 2017 | ||||||||||||
Consumer | ||||||||||||||||
Consumer automotive | $ | 168 | $ | 260 | $ | 421 | $ | 527 | ||||||||
Consumer mortgage | ||||||||||||||||
Mortgage Finance | — | 1 | 2 | 2 | ||||||||||||
Mortgage — Legacy | (4 | ) | (4 | ) | (5 | ) | (8 | ) | ||||||||
Total consumer mortgage | (4 | ) | (3 | ) | (3 | ) | (6 | ) | ||||||||
Total consumer loans | 164 | 257 | 418 | 521 | ||||||||||||
Commercial | ||||||||||||||||
Commercial and industrial | ||||||||||||||||
Automotive | 3 | 6 | 7 | 6 | ||||||||||||
Other | (8 | ) | 6 | (8 | ) | 12 | ||||||||||
Commercial real estate | (1 | ) | — | 2 | 1 | |||||||||||
Total commercial loans | (6 | ) | 12 | 1 | 19 | |||||||||||
Total provision for loan losses | $ | 158 | $ | 269 | $ | 419 | $ | 540 |
June 30, 2018 | December 31, 2017 | |||||||||||||||
Change in interest rates ($ in millions) | Gradual (a) | Instantaneous | Gradual (a) | Instantaneous | ||||||||||||
-100 basis points | $ | (28 | ) | $ | (80 | ) | $ | (22 | ) | $ | 15 | |||||
+100 basis points | (7 | ) | (72 | ) | (18 | ) | (106 | ) | ||||||||
+200 basis points | (7 | ) | (132 | ) | (68 | ) | (294 | ) |
(a) | Gradual changes in interest rates are recognized over 12 months. |
Three months ended June 30, | Six months ended June 30, | |||||||||||||||
2018 | 2017 | 2018 | 2017 | |||||||||||||
Off-lease vehicles terminated (in units) | 35,919 | 71,667 | 80,641 | 149,428 | ||||||||||||
Average gain per vehicle ($ per unit) | $ | 447 | $ | 453 | $ | 423 | $ | 194 | ||||||||
Method of vehicle sales | ||||||||||||||||
Auction | ||||||||||||||||
Internet | 51 | % | 55 | % | 53 | % | 56 | % | ||||||||
Physical | 14 | 13 | 14 | 13 | ||||||||||||
Sale to dealer, lessee, and other | 35 | 32 | 33 | 31 |
June 30, | 2018 | 2017 | ||||
Sport utility vehicle | 55 | % | 54 | % | ||
Truck | 31 | 22 | ||||
Car | 14 | 24 |
June 30, | 2018 | 2017 | ||||
Chrysler vehicles | 88 | % | 63 | % | ||
GM vehicles | 2 | 30 | ||||
Other | 10 | 7 |
• | Business disruption risk — The risk of significant disruption to our operations resulting from natural disasters, external technology outages, or other external events. |
• | Fraud risk — The risk from deliberate misrepresentation or concealment of information material to a transaction with the intent to deceive another and that is reasonably relied on or used in decision making. Fraud can occur internally (e.g., employees) or externally (e.g., criminal activity, third-party suppliers). |
• | Human capital risk — The risk caused by high turnover, inadequate or improper staffing levels, departure/unavailability of key personnel, or inadequate training and includes our exposure to worker’s compensation and employment litigation. |
• | Legal risk — The risk arising from the potential that unenforceable contracts, lawsuits, or adverse judgments can disrupt or otherwise negatively affect our operations or condition. |
• | Model risk — The potential for adverse consequences from decisions based on incorrect or misused model assumptions, inputs, outputs, and reports. This risk may include fundamental errors within the model that produce inaccurate outputs or that the model is used incorrectly or inappropriately. |
• | Process execution and management risk — The risk caused by failure to execute or adhere to policies, standards, procedures, processes, controls, and activities as designed and documented. |
• | Supplier (third party) risk — The risk associated with third-party suppliers and their delivery of products and/or services and effect on overall business performance. This includes a supplier’s failure to comply with information technology requirements, information and physical security, laws, rules, regulations, and legal agreements. |
June 30, 2018 ($ in millions) | ||||
Unencumbered highly liquid U.S. federal government and U.S. agency securities | $ | 13,444 | ||
Liquid cash and equivalents | 3,386 | |||
Committed funding facilities | ||||
Total capacity | 9,225 | |||
Outstanding | 6,355 | |||
Unused capacity (a) | 2,870 | |||
Total available liquidity | $ | 19,700 |
(a) | Funding from committed secured facilities is available on request in the event excess collateral resides in certain facilities or the extent incremental collateral is available and contributed to the facilities. |
2nd quarter 2018 | 1st quarter 2018 | 4th quarter 2017 | 3rd quarter 2017 | 2nd quarter 2017 | 1st quarter 2017 | ||||||||||||||||||
Number of retail bank accounts (in thousands) | 2,947 | 2,864 | 2,740 | 2,603 | 2,474 | 2,366 | |||||||||||||||||
Deposits ($ in millions) | |||||||||||||||||||||||
Retail | $ | 81,736 | $ | 81,657 | $ | 77,925 | $ | 74,928 | $ | 71,094 | $ | 69,971 | |||||||||||
Brokered (a) | 16,839 | 15,661 | 15,211 | 15,045 | 14,937 | 14,327 | |||||||||||||||||
Other (b) | 159 | 128 | 120 | 143 | 152 | 188 | |||||||||||||||||
Total deposits | $ | 98,734 | $ | 97,446 | $ | 93,256 | $ | 90,116 | $ | 86,183 | $ | 84,486 |
(a) | Brokered deposit balances include a deposit related to Ally Invest customer cash balances deposited at Ally Bank by a third party of $1.2 billion as of the end of each quarter presented. |
(b) | Other deposits include mortgage escrow, dealer, and other deposits. |
• | We closed, renewed, increased, and/or extended $6.6 billion in U.S. secured credit facilities during the six months ended June 30, 2018. |
• | We continued to access the public and private term asset-backed securitization markets raising $5.8 billion during the six months ended June 30, 2018. In the first six months of 2018, we raised $4.1 billion through securitizations backed by retail automotive loans. We also raised approximately $1.7 billion through a public securitization backed by dealer floorplan automotive assets. |
June 30, 2018 | December 31, 2017 | |||||||||||
($ in millions) | On-balance sheet funding | % Share of funding | On-balance sheet funding | % Share of funding | ||||||||
Secured financings | $ | 37,792 | 25 | $ | 36,869 | 25 | ||||||
Institutional term debt | 13,556 | 9 | 15,099 | 10 | ||||||||
Retail debt programs (a) | 2,989 | 2 | 3,463 | 2 | ||||||||
Total debt (b) | 54,337 | 36 | 55,431 | 37 | ||||||||
Deposits | 98,734 | 64 | 93,256 | 63 | ||||||||
Total on-balance sheet funding | $ | 153,071 | 100 | $ | 148,687 | 100 |
(a) | Includes $323 million and $292 million of retail term notes at June 30, 2018, and December 31, 2017, respectively. |
(b) | Excludes fair value adjustment as described in Note 18 to the Condensed Consolidated Financial Statements. |
Common stock repurchased during period (a) | Number of common shares outstanding | Cash dividends declared per common share (b) | |||||||||||||||
($ in millions, except per share data; shares in thousands) | Approximate dollar value | Number of shares | Beginning of period | End of period | |||||||||||||
2016 | |||||||||||||||||
Third quarter | $ | 159 | 8,298 | 483,753 | 475,470 | $ | 0.08 | ||||||||||
Fourth quarter | 167 | 8,745 | 475,470 | 467,000 | 0.08 | ||||||||||||
2017 | |||||||||||||||||
First quarter | $ | 169 | 8,097 | 467,000 | 462,193 | $ | 0.08 | ||||||||||
Second quarter | 204 | 10,485 | 462,193 | 452,292 | 0.08 | ||||||||||||
Third quarter | 190 | 8,507 | 452,292 | 443,796 | 0.12 | ||||||||||||
Fourth quarter | 190 | 7,033 | 443,796 | 437,054 | 0.12 | ||||||||||||
2018 | |||||||||||||||||
First quarter | $ | 185 | 6,473 | 437,054 | 432,691 | $ | 0.13 | ||||||||||
Second quarter | 195 | 7,280 | 432,691 | 425,752 | 0.13 |
(a) | Includes shares of common stock withheld to cover income taxes owed by participants in our share-based incentive plans. |
(b) | On July 13, 2018, the Board declared a quarterly cash dividend of $0.15 per share on all common stock, payable on August 15, 2018. Refer to Note 25 to the Condensed Consolidated Financial Statements for further information regarding this common stock dividend. |
Rating agency | Short-term | Senior unsecured debt | Outlook | Date of last action | ||||
Fitch | B | BB+ | Positive | September 8, 2017 (a) | ||||
Moody’s | Not Prime | Ba3 | Stable | October 20, 2015 (b) | ||||
S&P | B | BB+ | Stable | October 16, 2017 (c) | ||||
DBRS | R-3 | BBB (Low) | Stable | May 1, 2018 (d) |
(a) | Fitch affirmed our senior unsecured debt rating of BB+, affirmed our short-term rating of B, and changed the outlook from Stable to Positive on September 8, 2017. |
(b) | Moody’s upgraded our senior unsecured debt rating to Ba3 from B1, affirmed our short-term rating of Not Prime, and changed the outlook to Stable on October 20, 2015. Effective December 1, 2014, we determined to not renew our contractual arrangement with Moody’s related to their providing of our issuer, senior debt, and short-term ratings. Notwithstanding this, Moody’s has determined to continue to provide these ratings on a discretionary basis. However, Moody’s has no obligation to continue to provide these ratings, and could cease doing so at any time. |
(c) | Standard & Poor’s affirmed our senior unsecured debt rating of BB+, affirmed our short-term rating of B, and maintained a Stable outlook on October 16, 2017. |
(d) | DBRS affirmed our senior unsecured debt rating of BBB (Low), affirmed our short-term rating of R-3, and maintained a Stable outlook on May 1, 2018. |
• | Allowance for loan losses |
• | Valuation of automotive lease assets and residuals |
• | Fair value of financial instruments |
• | Legal and regulatory reserves |
• | Determination of provision for income taxes |
2018 | 2017 | Increase (decrease) due to | ||||||||||||||||||||||||||||||||
Three months ended June 30, ($ in millions) | Average balance (a) | Interest income/interest expense | Yield/rate | Average balance (a) | Interest income/interest expense | Yield/rate | Volume | Yield/rate | Total | |||||||||||||||||||||||||
Assets | ||||||||||||||||||||||||||||||||||
Interest-bearing cash and cash equivalents | $ | 3,048 | $ | 17 | 2.24 | % | $ | 2,683 | $ | 7 | 1.05 | % | $ | 1 | $ | 9 | $ | 10 | ||||||||||||||||
Investment securities (b) | 25,748 | 173 | 2.69 | 22,203 | 139 | 2.51 | 22 | 12 | 34 | |||||||||||||||||||||||||
Loans held-for-sale, net | 358 | 6 | 6.72 | 2 | — | — | 6 | — | 6 | |||||||||||||||||||||||||
Finance receivables and loans, net (b) (c) | 124,516 | 1,647 | 5.31 | 119,235 | 1,447 | 4.87 | 64 | 136 | 200 | |||||||||||||||||||||||||
Investment in operating leases, net (d) | 8,583 | 109 | 5.09 | 10,109 | 167 | 6.63 | (25 | ) | (33 | ) | (58 | ) | ||||||||||||||||||||||
Other earning assets | 1,239 | 15 | 4.86 | 846 | 7 | 3.32 | 3 | 5 | 8 | |||||||||||||||||||||||||
Total interest-earning assets | 163,492 | 1,967 | 4.83 | 155,078 | 1,767 | 4.57 | 200 | |||||||||||||||||||||||||||
Noninterest-bearing cash and cash equivalents | 526 | 968 | ||||||||||||||||||||||||||||||||
Other assets | 7,505 | 7,727 | ||||||||||||||||||||||||||||||||
Allowance for loan losses | (1,274 | ) | (1,172 | ) | ||||||||||||||||||||||||||||||
Total assets | $ | 170,249 | $ | 162,601 | ||||||||||||||||||||||||||||||
Liabilities | ||||||||||||||||||||||||||||||||||
Interest-bearing deposit liabilities | $ | 97,351 | $ | 399 | 1.64 | % | $ | 84,792 | $ | 250 | 1.18 | % | $ | 37 | $ | 112 | $ | 149 | ||||||||||||||||
Short-term borrowings | 8,767 | 40 | 1.83 | 9,024 | 33 | 1.47 | (1 | ) | 8 | 7 | ||||||||||||||||||||||||
Long-term debt (b) | 45,802 | 434 | 3.80 | 50,723 | 417 | 3.30 | (40 | ) | 57 | 17 | ||||||||||||||||||||||||
Total interest-bearing liabilities | 151,920 | 873 | 2.30 | 144,539 | 700 | 1.94 | 173 | |||||||||||||||||||||||||||
Noninterest-bearing deposit liabilities | 126 | 95 | ||||||||||||||||||||||||||||||||
Total funding sources | 152,046 | 873 | 2.30 | 144,634 | 700 | 1.94 | ||||||||||||||||||||||||||||
Other liabilities | 5,134 | 4,526 | ||||||||||||||||||||||||||||||||
Total liabilities | 157,180 | 149,160 | ||||||||||||||||||||||||||||||||
Total equity | 13,069 | 13,441 | ||||||||||||||||||||||||||||||||
Total liabilities and equity | $ | 170,249 | $ | 162,601 | ||||||||||||||||||||||||||||||
Net financing revenue and other interest income | $ | 1,094 | $ | 1,067 | $ | 27 | ||||||||||||||||||||||||||||
Net interest spread (e) | 2.53 | % | 2.63 | % | ||||||||||||||||||||||||||||||
Net yield on interest-earning assets (f) | 2.68 | % | 2.76 | % |
(a) | Average balances are calculated using a combination of monthly and daily average methodologies. |
(b) | Includes the effects of derivative financial instruments designated as hedges. Refer to Note 18 to the Condensed Consolidated Financial Statements for further information about the effects of our hedging activities. |
(c) | Nonperforming finance receivables and loans are included in the average balances. For information on our accounting policies regarding nonperforming status, refer to Note 1 to the Consolidated Financial Statements in our 2017 Annual Report on Form 10-K. |
(d) | Yield includes gains on the sale of off-lease vehicles of $16 million and $32 million for the three months ended June 30, 2018, and 2017, respectively. Excluding these gains on sale, the annualized yield would be 4.35% and 5.36% for the three months ended June 30, 2018, and 2017, respectively. |
(e) | Net interest spread represents the difference between the rate on total interest-earning assets and the rate on total interest-bearing liabilities. |
(f) | Net yield on interest-earning assets represents annualized net financing revenue and other interest income as a percentage of total interest-earning assets. |
2018 | 2017 | Increase (decrease) due to | ||||||||||||||||||||||||||||||||
Six months ended June 30, ($ in millions) | Average balance (a) | Interest income/interest expense | Yield/rate | Average balance (a) | Interest income/interest expense | Yield/rate | Volume | Yield/rate | Total | |||||||||||||||||||||||||
Assets | ||||||||||||||||||||||||||||||||||
Interest-bearing cash and cash equivalents | $ | 3,274 | $ | 32 | 1.97 | % | $ | 2,679 | $ | 12 | 0.90 | % | $ | 3 | $ | 17 | $ | 20 | ||||||||||||||||
Investment securities (b) | 25,491 | 336 | 2.66 | 21,347 | 265 | 2.50 | 51 | 20 | 71 | |||||||||||||||||||||||||
Loans held-for-sale, net | 217 | 6 | 5.58 | 1 | — | — | 6 | — | 6 | |||||||||||||||||||||||||
Finance receivables and loans, net (b) (c) | 123,506 | 3,190 | 5.21 | 118,608 | 2,815 | 4.79 | 116 | 259 | 375 | |||||||||||||||||||||||||
Investment in operating leases, net (d) | 8,606 | 218 | 5.11 | 10,518 | 321 | 6.15 | (58 | ) | (45 | ) | (103 | ) | ||||||||||||||||||||||
Other earning assets | 1,175 | 28 | 4.81 | 831 | 15 | 3.64 | 6 | 7 | 13 | |||||||||||||||||||||||||
Total interest-earning assets | 162,269 | 3,810 | 4.73 | 153,984 | 3,428 | 4.49 | 382 | |||||||||||||||||||||||||||
Noninterest-bearing cash and cash equivalents | 521 | 1,034 | ||||||||||||||||||||||||||||||||
Other assets | 7,383 | 7,870 | ||||||||||||||||||||||||||||||||
Allowance for loan losses | (1,278 | ) | (1,158 | ) | ||||||||||||||||||||||||||||||
Total assets | $ | 168,895 | $ | 161,730 | ||||||||||||||||||||||||||||||
Liabilities | ||||||||||||||||||||||||||||||||||
Interest-bearing deposit liabilities | $ | 96,330 | $ | 750 | 1.57 | % | $ | 83,484 | $ | 481 | 1.16 | % | $ | 74 | $ | 195 | $ | 269 | ||||||||||||||||
Short-term borrowings | 8,556 | 72 | 1.70 | 8,626 | 60 | 1.40 | — | 12 | 12 | |||||||||||||||||||||||||
Long-term debt (b) | 45,669 | 845 | 3.73 | 51,631 | 841 | 3.28 | (97 | ) | 101 | 4 | ||||||||||||||||||||||||
Total interest-bearing liabilities | 150,555 | 1,667 | 2.23 | 143,741 | 1,382 | 1.94 | 285 | |||||||||||||||||||||||||||
Noninterest-bearing deposit liabilities | 120 | 94 | ||||||||||||||||||||||||||||||||
Total funding sources | 150,675 | 1,667 | 2.23 | 143,835 | 1,382 | 1.94 | ||||||||||||||||||||||||||||
Other liabilities | 5,081 | 4,454 | ||||||||||||||||||||||||||||||||
Total liabilities | 155,756 | 148,289 | ||||||||||||||||||||||||||||||||
Total equity | 13,139 | 13,441 | ||||||||||||||||||||||||||||||||
Total liabilities and equity | $ | 168,895 | $ | 161,730 | ||||||||||||||||||||||||||||||
Net financing revenue and other interest income | $ | 2,143 | $ | 2,046 | $ | 97 | ||||||||||||||||||||||||||||
Net interest spread (e) | 2.50 | % | 2.55 | % | ||||||||||||||||||||||||||||||
Net yield on interest-earning assets (f) | 2.66 | % | 2.68 | % |
(a) | Average balances are calculated using a combination of monthly and daily average methodologies. |
(b) | Includes the effects of derivative financial instruments designated as hedges. Refer to Note 18 to the Condensed Consolidated Financial Statements for further information about the effects of our hedging activities. |
(c) | Nonperforming finance receivables and loans are included in the average balances. For information on our accounting policies regarding nonperforming status, refer to Note 1 to the Consolidated Financial Statements in our 2017 Annual Report on Form 10-K. |
(d) | Yield includes gains on the sale of off-lease vehicles of $34 million and $29 million for the six months ended June 30, 2018, and 2017, respectively. Excluding these gains on sale, the annualized yield would be 4.31% and 5.60% for the six months ended June 30, 2018, and 2017, respectively. |
(e) | Net interest spread represents the difference between the rate on total interest-earning assets and the rate on total interest-bearing liabilities. |
(f) | Net yield on interest-earning assets represents annualized net financing revenue and other interest income as a percentage of total interest-earning assets. |
• | evolving local, regional, national, or international business, economic, or political conditions; |
• | changes in laws or the regulatory or supervisory environment, including as a result of recent financial services legislation, regulation, or policies or changes in government officials or other personnel; |
• | changes in monetary, fiscal, or trade laws or policies, including as a result of actions by government agencies, central banks, or supranational authorities; |
• | changes in accounting standards or policies, including ASU 2016-13, Financial Instruments — Credit Losses; |
• | changes in the automotive industry or the markets for new or used vehicles, including the rise of vehicle sharing and ride hailing, the development of autonomous and alternative-energy vehicles, and the impact of demographic shifts on attitudes and behaviors toward vehicle ownership and use; |
• | disruptions or shifts in investor sentiment or behavior in the securities, capital, or other financial markets, including financial or systemic shocks and volatility or changes in market liquidity, interest or currency rates, or valuations; |
• | changes in business or consumer sentiment, preferences, or behavior, including spending, borrowing, or saving by businesses or households; |
• | changes in our corporate or business strategies, the composition of our assets, or the way in which we fund those assets; |
• | our ability to execute our business strategy for Ally Bank, including its digital focus; |
• | our ability to optimize our automotive finance and insurance businesses and to continue diversifying into and growing other consumer and commercial business lines, including mortgage finance, corporate finance, brokerage, and wealth management; |
• | our ability to develop capital plans that will be approved by the FRB and our ability to implement them, including any payment of dividends or share repurchases; |
• | our ability to effectively manage capital or liquidity consistent with evolving business or operational needs, risk management standards, and regulatory or supervisory requirements; |
• | our ability to cost-effectively fund our business and operations, including through deposits and the capital markets; |
• | changes in any credit rating assigned to Ally, including Ally Bank; |
• | adverse publicity or other reputational harm to us or our senior officers; |
• | our ability to develop, maintain, or market our products or services or to absorb unanticipated costs or liabilities associated with those products or services; |
• | our ability to innovate, to anticipate the needs of current or future customers, to successfully compete, to increase or hold market share in changing competitive environments, or to deal with pricing or other competitive pressures; |
• | the continuing profitability and viability of our dealer-centric automotive finance and insurance businesses, especially in the face of competition from captive finance companies and their automotive manufacturing sponsors and challenges to the dealer’s role as intermediary between manufacturers and purchasers; |
• | our ability to appropriately underwrite loans that we originate or purchase and to otherwise manage credit risk; |
• | changes in the credit, liquidity, or other financial condition of our customers, counterparties, service providers, or competitors; |
• | our ability to effectively deal with economic, business, or market slowdowns or disruptions; |
• | judicial, regulatory, or administrative investigations, proceedings, disputes, or rulings that create uncertainty for, or are adverse to, us or the financial services industry; |
• | our ability to address stricter or heightened regulatory or supervisory requirements and expectations; |
• | the performance and availability of third-party service providers on whom we rely in delivering products and services to our customers and otherwise conducting our business and operations; |
• | our ability to maintain secure and functional financial, accounting, technology, data processing, or other operating systems or infrastructure, including our capacity to withstand cyberattacks; |
• | the adequacy of our corporate governance, risk management framework, compliance programs, or internal controls over financial reporting, including our ability to control lapses or deficiencies in financial reporting or to effectively mitigate or manage operational risk; |
• | the efficacy of our methods or models in assessing business strategies or opportunities or in valuing, measuring, estimating, monitoring, or managing positions or risk; |
• | our ability to keep pace with changes in technology that affect us or our customers, counterparties, service providers, or competitors; |
• | our ability to successfully make and integrate acquisitions; |
• | the adequacy of our succession planning for key executives or other personnel and our ability to attract or retain qualified employees; |
• | natural or man-made disasters, calamities, or conflicts, including terrorist events and pandemics; or |
• | other assumptions, risks, or uncertainties described in the Risk Factors (Part II, Item 1A herein), Management’s Discussion and Analysis of Financial Condition and Results of Operations (Part I, Item 2 herein), or the Notes to the Condensed Consolidated Financial Statements (Part I, Item 1 herein) in this Quarterly Report on Form 10-Q or described in any of the Company’s annual, quarterly or current reports. |
Three months ended June 30, 2018 | Total number of shares repurchased (a) (in thousands) | Weighted-average price paid per share (a) (b) (in dollars) | Total number of shares repurchased as part of publicly announced program (a) (c) (in thousands) | Maximum approximate dollar value of shares that may yet be repurchased under the program (a) (b) (c) ($ in millions) | ||||||||||
April 2018 | 2,090 | $ | 27.18 | 2,090 | $ | 138 | ||||||||
May 2018 | 3,411 | 26.62 | 3,411 | 47 | ||||||||||
June 2018 | 1,779 | 26.36 | 1,779 | — | ||||||||||
Total | 7,280 | 26.72 | 7,280 |
(a) | Includes shares of common stock withheld to cover income taxes owed by participants in our share-based incentive plans. |
(b) | Excludes brokerage commissions. |
(c) | On June 28, 2017, we announced a common stock repurchase program of up to $760 million. The program commenced in the third quarter of 2017 and expired on June 30, 2018. Refer to Note 17 to the Condensed Consolidated Financial Statements for a discussion of our 2018 capital plan. |
Exhibit | Description | Method of Filing |
10.1 | Separation and Transition Services Agreement, effective April 18, 2018, by and between Ally Financial Inc. and Timothy M. Russi | Filed as Exhibit 10.1 to the Company’s Current Report on Form 8-K dated as of April 18, 2018, (File No. 1-3754), incorporated herein by reference. |
12 | Filed herewith. | |
31.1 | Filed herewith. | |
31.2 | Filed herewith. | |
32 | Filed herewith. | |
101 | The following information from our Form 10-Q for the quarterly period ended June 30, 2018, formatted in eXtensible Business Reporting Language: (i) Condensed Consolidated Statement of Comprehensive Income (unaudited), (ii) Condensed Consolidated Balance Sheet (unaudited), (iii) Condensed Consolidated Statement of Changes in Equity (unaudited), (iv) Condensed Consolidated Statement of Cash Flows (unaudited), and (v) the Notes to the Condensed Consolidated Financial Statements (unaudited). | Filed herewith. |
Ally Financial Inc. (Registrant) | |
/S/ JENNIFER A. LACLAIR | |
Jennifer A. LaClair Chief Financial Officer |
/S/ DAVID J. DEBRUNNER | |
David J. DeBrunner Vice President, Chief Accounting Officer, and Corporate Controller |
Six months ended June 30, | Year ended December 31, | ||||||||||||||||||
($ in millions) | 2018 (a) | 2017 (a) | 2016 (a) | 2015 (a) | 2014 (a) | 2013 (a) | |||||||||||||
Earnings | |||||||||||||||||||
Consolidated net income from continuing operations | $ | 599 | $ | 926 | $ | 1,111 | $ | 897 | $ | 925 | $ | 416 | |||||||
Income tax expense (benefit) from continuing operations | 189 | 581 | 470 | 496 | 321 | (59 | ) | ||||||||||||
Equity-method investee earnings | (13 | ) | (14 | ) | (18 | ) | (52 | ) | (18 | ) | (15 | ) | |||||||
Consolidated income from continuing operations before income taxes, minority interest, and income from equity investees | 775 | 1,493 | 1,563 | 1,341 | 1,228 | 342 | |||||||||||||
Fixed charges | 1,675 | 2,878 | 2,641 | 2,460 | 2,826 | 3,344 | |||||||||||||
Earnings available for fixed charges | $ | 2,450 | $ | 4,371 | $ | 4,204 | $ | 3,801 | $ | 4,054 | $ | 3,686 | |||||||
Fixed charges | |||||||||||||||||||
Interest, discount, and issuance expense on debt | $ | 1,668 | $ | 2,862 | $ | 2,624 | $ | 2,443 | $ | 2,810 | $ | 3,330 | |||||||
Portion of rentals representative of the interest factor | 7 | 16 | 17 | 17 | 16 | 15 | |||||||||||||
Total fixed charges | $ | 1,675 | $ | 2,878 | $ | 2,641 | $ | 2,460 | $ | 2,826 | $ | 3,345 | |||||||
Ratio of earnings to fixed charges | 1.46 | 1.52 | 1.59 | 1.55 | 1.43 | 1.10 |
(a) | For all periods presented, the operating results of our discontinued operations have been removed from continuing operations. We report these businesses separately as discontinued operations in the Condensed Consolidated Financial Statements. Our discontinued operations relate to previous discontinued operations in our Automotive Finance operations, Insurance operations, and Corporate Finance operating segments, and other operations for which we continue to have wind-down, legal, and minimal operational costs. All reported periods of the calculation of the ratio of earnings to fixed charges exclude discontinued operations. |
1. | I have reviewed this report on Form 10-Q of Ally Financial Inc.; |
2. | Based on my knowledge, this report does not contain any untrue statement of a material fact or omit to state a material fact necessary to make the statements made, in light of the circumstances under which such statements were made, not misleading with respect to the period covered by this report; |
3. | Based on my knowledge, the financial statements, and other financial information included in this report, fairly present in all material respects the financial condition, results of operations, and cash flows of the registrant as of, and for, the periods presented in this report; |
4. | The registrant’s other certifying officer and I are responsible for establishing and maintaining disclosure controls and procedures (as defined in Exchange Act Rules 13a–15(e) and 15d–15(e)) and internal control over financial reporting (as defined in Exchange Act Rules 13a–15(f) and 15d–15(f)) for the registrant and have: |
a) | designed such disclosure controls and procedures, or caused such disclosure controls and procedures to be designed under our supervision, to ensure that material information relating to the registrant, including its consolidated subsidiaries, is made known to us by others within those entities, particularly during the period in which this report is being prepared; |
b) | designed such internal control over financial reporting or caused such internal control over financial reporting to be designed under our supervision, to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles; |
c) | evaluated the effectiveness of the registrant’s disclosure controls and procedures and presented in this report our conclusions about the effectiveness of the disclosure controls and procedures, as of the end of the period covered by this report based on such evaluation; and |
d) | disclosed in this report any change in the registrant’s internal control over financial reporting that occurred during the registrant’s most recent fiscal quarter that has materially affected, or is reasonably likely to materially affect the registrant’s internal control over financial reporting; and |
5. | The registrant’s other certifying officer and I have disclosed, based on our most recent evaluation of internal control over financial reporting, to the registrant’s auditors and the audit committee of registrant’s board of directors (or persons performing the equivalent function): |
a) | all significant deficiencies and material weaknesses in the design or operation of internal control over financial reporting which are reasonably likely to adversely affect the registrant’s ability to record, process, summarize, and report financial information; and |
b) | any fraud, whether or not material, that involves management or other employees who have a significant role in the registrant’s internal control over financial reporting. |
/S/ JEFFREY J. BROWN | |
Jeffrey J. Brown Chief Executive Officer |
1. | I have reviewed this report on Form 10-Q of Ally Financial Inc.; |
2. | Based on my knowledge, this report does not contain any untrue statement of a material fact or omit to state a material fact necessary to make the statements made, in light of the circumstances under which such statements were made, not misleading with respect to the period covered by this report; |
3. | Based on my knowledge, the financial statements, and other financial information included in this report, fairly present in all material respects the financial condition, results of operations, and cash flows of the registrant as of, and for, the periods presented in this report; |
4. | The registrant’s other certifying officer and I are responsible for establishing and maintaining disclosure controls and procedures (as defined in Exchange Act Rules 13a–15(e) and 15d–15(e)) and internal control over financial reporting (as defined in Exchange Act Rules 13a–15(f) and 15d–15(f)) for the registrant and have: |
a) | designed such disclosure controls and procedures, or caused such disclosure controls and procedures to be designed under our supervision, to ensure that material information relating to the registrant, including its consolidated subsidiaries, is made known to us by others within those entities, particularly during the period in which this report is being prepared; |
b) | designed such internal control over financial reporting or caused such internal control over financial reporting to be designed under our supervision, to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles; |
c) | evaluated the effectiveness of the registrant’s disclosure controls and procedures and presented in this report our conclusions about the effectiveness of the disclosure controls and procedures, as of the end of the period covered by this report based on such evaluation; and |
d) | disclosed in this report any change in the registrant’s internal control over financial reporting that occurred during the registrant’s most recent fiscal quarter that has materially affected, or is reasonably likely to materially affect the registrant’s internal control over financial reporting; and |
5. | The registrant’s other certifying officer and I have disclosed, based on our most recent evaluation of internal control over financial reporting, to the registrant’s auditors and the audit committee of registrant’s board of directors (or persons performing the equivalent function): |
a) | all significant deficiencies and material weaknesses in the design or operation of internal control over financial reporting which are reasonably likely to adversely affect the registrant’s ability to record, process, summarize, and report financial information; and |
b) | any fraud, whether or not material, that involves management or other employees who have a significant role in the registrant’s internal control over financial reporting. |
/S/ JENNIFER A. LACLAIR | |
Jennifer A. LaClair Chief Financial Officer |
1. | The Report fully complies with the requirements of section 13(a) or 15(d) of the Securities Exchange Act of 1934; and |
2. | The information contained in the Report fairly presents, in all material respects, the financial condition and results of operations of the Company. |
/S/ JEFFREY J. BROWN | |
Jeffrey J. Brown | |
Chief Executive Officer | |
August 1, 2018 | |
/S/ JENNIFER A. LACLAIR | |
Jennifer A. LaClair | |
Chief Financial Officer | |
August 1, 2018 |
Document and Entity Information - USD ($) |
6 Months Ended | ||
---|---|---|---|
Jun. 30, 2018 |
Jul. 30, 2018 |
Jun. 30, 2017 |
|
Document And Entity Information [Abstract] | |||
Entity Registrant Name | Ally Financial Inc. | ||
Entity Central Index Key | 0000040729 | ||
Current Fiscal Year End Date | --12-31 | ||
Entity Filer Category | Large Accelerated Filer | ||
Document Type | 10-Q | ||
Document Period End Date | Jun. 30, 2018 | ||
Document Fiscal Year Focus | 2018 | ||
Document Fiscal Period Focus | Q2 | ||
Amendment Flag | false | ||
Entity Common Stock, Shares Outstanding | 422,080,891 | ||
Entity Well-known Seasoned Issuer | Yes | ||
Entity Voluntary Filers | No | ||
Entity Current Reporting Status | Yes | ||
Entity Public Float | $ 9,452,901,086 |
Consolidated Balance Sheet and Mini Balance Sheet (Paranthetical) - USD ($) $ in Millions |
Jun. 30, 2018 |
Dec. 31, 2017 |
---|---|---|
Condensed Balance Sheet Statements, Captions [Line Items] | ||
Common Stock, Par or Stated Value Per Share | $ 0.01 | $ 0.01 |
Common Stock, Shares Authorized | 1,100,000,000 | 1,100,000,000 |
Common Stock, Shares, Issued | 492,334,686 | 489,883,553 |
Common Stock, Shares, Outstanding | 437,053,936 | |
Treasury Stock, Shares | 66,582,505 | 52,829,617 |
Held-to-maturity Securities, Fair Value | $ 2,007 | $ 1,865 |
End of Period [Member] | ||
Condensed Balance Sheet Statements, Captions [Line Items] | ||
Common Stock, Shares, Outstanding | 425,752,000 | 437,054,000 |
Description of Business, Basis of Presentation, and Changes in Significant Accounting Policies |
6 Months Ended |
---|---|
Jun. 30, 2018 | |
Organization, Consolidation and Presentation of Financial Statements [Abstract] | |
Organization, Consolidation, Basis of Presentation, Business Description and Accounting Policies [Text Block] | Description of Business, Basis of Presentation, and Changes in Significant Accounting Policies Ally Financial Inc. (together with its consolidated subsidiaries unless the context requires otherwise, Ally, the Company, or we, us, or our) is a leading digital financial services company and top 25 U.S. financial holding company (FHC) based on total assets, offering diversified financial products and services for consumers, businesses, automotive dealers, and corporate clients. Ally operates with a distinctive brand, an innovative approach, and a relentless focus on our customers. We are a Delaware corporation and are registered as a bank holding company (BHC) under the Bank Holding Company Act of 1956, as amended, and an FHC under the Gramm-Leach-Bliley Act of 1999, as amended. We are one of the largest full service automotive finance operations in the country with a legacy that dates back to 1919, a deep expertise in automotive lending, and a complementary automotive-focused insurance business. Our wholly-owned banking subsidiary, Ally Bank, has received numerous industry awards for its services and capabilities and is one of the largest and most respected online banks, uniquely positioned for the observed shifting trends in consumer banking preferences for digital banking. We offer mortgage lending services and a variety of deposit and other banking products, including CDs, online savings, money market and checking accounts, and IRA products. We also promote a cash back credit card. We have recently integrated a growing digital wealth management and online brokerage platform to enable consumers to have a variety of options in managing their savings and wealth. Additionally, through our corporate finance business, we primarily offer senior secured leveraged cash flow and asset-based loans to middle-market companies. Our accounting and reporting policies conform to accounting principles generally accepted in the United States of America (GAAP). Additionally, where applicable, the policies conform to the accounting and reporting guidelines prescribed by bank regulatory authorities. The preparation of financial statements in conformity with GAAP requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities and disclosure of contingent assets and liabilities at the date of the financial statements and that affect income and expenses during the reporting period and related disclosures. In developing the estimates and assumptions, management uses all available evidence; however, actual results could differ because of uncertainties associated with estimating the amounts, timing, and likelihood of possible outcomes. Our most significant estimates pertain to the allowance for loan losses, valuations of automotive lease assets and residuals, fair value of financial instruments, legal and regulatory reserves, and the determination of the provision for income taxes. The Condensed Consolidated Financial Statements at June 30, 2018, and for the three months and six months ended June 30, 2018, and 2017, are unaudited but reflect all adjustments that are, in management’s opinion, necessary for the fair presentation of the results for the interim periods presented. All such adjustments are of a normal recurring nature. These unaudited Condensed Consolidated Financial Statements should be read in conjunction with the audited Consolidated Financial Statements (and the related Notes) included in our Annual Report on Form 10-K for the year ended December 31, 2017, as filed on February 21, 2018, with the U.S. Securities and Exchange Commission (SEC). Significant Accounting Policies Investments Our investment portfolio includes various debt and equity securities. Our debt securities include government securities, corporate bonds, asset-backed securities (ABS), and mortgage-backed securities (MBS). Debt securities are classified based on management’s intent to sell or hold the security. We classify debt securities as held-to-maturity only when we have both the intent and ability to hold the securities to maturity. We classify debt securities as trading when the securities are acquired for the purpose of selling or holding them for a short period of time. Debt securities not classified as either held-to-maturity or trading are classified as available-for-sale. Our portfolio includes debt securities classified as available-for-sale and held-to-maturity. Our available-for-sale debt securities are carried at fair value with unrealized gains and losses included in accumulated other comprehensive loss and are subject to impairment. Our held-to-maturity debt securities are carried at amortized cost and are subject to impairment. We assess our available-for-sale and held-to-maturity debt securities for potential other-than-temporary impairment. We employ a methodology that considers available evidence in evaluating potential other-than-temporary impairment of our debt securities. If the cost of an investment exceeds its fair value, we evaluate, among other factors, the magnitude and duration of the decline in fair value. We also evaluate the financial health of and business outlook for the issuer, the performance of the underlying assets for interests in securitized assets, and, for debt securities classified as available-for-sale, our intent and ability to hold the investment through recovery of its amortized cost basis. Once a decline in fair value of a debt security is determined to be other-than-temporary, an impairment charge for the credit component is recorded to other gain (loss) on investments, net, in our Condensed Consolidated Statement of Comprehensive Income, and a new cost basis in the investment is established. The noncredit loss component of an available-for-sale debt security continues to be recorded in other comprehensive (loss) income when we do not intend to sell the security and it is not more likely than not that we will have to sell the security prior to the security’s anticipated recovery. Both the credit and noncredit loss components are recorded in earnings when we intend to sell the security or it is more likely than not that we will have to sell the security prior to the security’s anticipated recovery. Subsequent increases and decreases to the fair value of available-for-sale debt securities are included in other comprehensive (loss) income, so long as they are not attributable to another other-than-temporary impairment. We amortize premiums and discounts on debt securities as an adjustment to investment yield generally over the stated maturity of the security. For ABS and MBS where prepayments can be reasonably estimated, amortization is adjusted for expected prepayments. Our investment in equity securities includes securities that are recognized at fair value with changes in the fair value recorded in earnings, and equity securities that are recognized using other measurement principles. Effective January 1, 2018, equity securities that have a readily determinable fair value, as well as certain investments that do not have a readily determinable fair value and are not eligible to be recognized using other measurement principles, are recorded at fair value with changes in fair value recorded in earnings and reported in other gain (loss) on investments, net in our Condensed Consolidated Statement of Comprehensive Income. These investments, which are primarily attributable to the investment portfolio of our Insurance operations, are included in equity securities on our Condensed Consolidated Balance Sheet. Refer to Note 6 for further information on our equity securities that have a readily determinable market value. Our equity securities recognized using other measurement principles include investments in Federal Home Loan Bank (FHLB) and Federal Reserve Bank (FRB) stock held to meet regulatory requirements, equity investments related to low income housing tax credits and the Community Reinvestment Act (CRA), which do not have a readily determinable fair value, and other equity investments that do not have a readily determinable fair value. Our low income housing tax credit investments are accounted for using the proportional amortization method of accounting for qualified affordable housing investments. Our obligations related to unfunded commitments for our low income housing tax credit investments are included in other liabilities. The majority of our CRA investments are accounted for using the equity method of accounting. Our investments in low income housing tax credits and CRA investments are included in other assets on our Condensed Consolidated Balance Sheet. Our investments in FHLB and FRB stock are carried at cost. Our remaining investments in equity securities are recorded at cost, less impairment and adjusted for observable price changes under the measurement alternative provided under GAAP. These investments, along with our investments in FHLB and FRB stock, are included in nonmarketable equity investments in other assets on our Condensed Consolidated Balance Sheet. As conditions warrant, we review these investments for impairment and adjust the carrying value of the investment if it is deemed to be impaired. Investments recorded under the measurement alternative are also reviewed at each reporting period to determine if any adjustments are required for observable price changes in identical or similar securities of the same issuer. Realized gains and losses on the sale of securities are determined using the specific identification method and are reported in other gain (loss) on investments, net in our Condensed Consolidated Statement of Comprehensive Income. Derivative Instruments and Hedging Activities We use derivative instruments primarily for risk management purposes. We do not use derivative instruments for speculative purposes. Certain of our derivative instruments are designated as accounting hedges in qualifying relationships, whereas other derivative instruments have not been designated as accounting hedges. In accordance with applicable accounting standards, all derivative instruments, whether designated for hedge accounting or not, are required to be recorded on the balance sheet as assets or liabilities and measured at fair value. We have elected to report the fair value of derivative assets and liabilities on a gross basis—including the fair value for the right to reclaim cash collateral or the obligation to return cash collateral—arising from instruments executed with the same counterparty under a master netting arrangement where we do not have the intent to offset. For additional information on derivative instruments and hedging activities, refer to Note 18. At the inception of a hedge accounting relationship, we designate each qualifying hedge relationship as a hedge of the fair value of a specifically identified asset or liability (fair value hedge); as a hedge of the variability of cash flows to be received or paid, or forecasted to be received or paid, related to a recognized asset or liability (cash flow hedge); or as a hedge of the foreign-currency exposure of a net investment in a foreign operation (net investment hedge). We formally document all relationships between hedging instruments and hedged items, as well as the risk management objectives for undertaking various hedge transactions. Both at hedge inception and on an ongoing basis, we formally assess whether the derivatives that are used in hedging relationships are highly effective in offsetting changes in the fair values or cash flows of hedged items. Changes in the fair value of derivative instruments qualifying as fair value hedges, along with the gain or loss on the hedged asset or liability attributable to the hedged risk, are recorded in current period earnings. For qualifying cash flow hedges, the changes in fair value of the derivative financial instruments are recorded in accumulated other comprehensive loss and recognized in the income statement when the hedged cash flows affect earnings. For a qualifying net investment hedge, the gain or loss is reported in accumulated other comprehensive loss as part of the cumulative translation adjustment. Hedge accounting treatment is no longer applied if a derivative financial instrument is terminated, or if the hedge designation is removed or assessed to be no longer highly effective. For terminated fair value hedges, any changes to the hedged asset or liability remain as part of the basis of the hedged asset or liability and are recognized into income over the remaining life of the asset or liability. For terminated cash flow hedges, unless it is probable that the forecasted cash flows will not occur within a specified period, any changes in fair value of the derivative financial instrument previously recognized remain in accumulated other comprehensive loss, and are reclassified into earnings in the same period that the hedged cash flows affect earnings. Any previously recognized gain or loss for a net investment hedge continues to remain in accumulated other comprehensive loss until earnings are impacted by sale or liquidation of the associated foreign operation. In all instances, after hedge accounting is no longer applied, any subsequent changes in fair value of the derivative instrument will be recorded into earnings. Changes in the fair value of derivative financial instruments held for risk management purposes that are not designated as accounting hedges under GAAP are reported in current period earnings. Income Taxes In calculating the provision for interim income taxes, in accordance with Accounting Standards Codification (ASC) 740, Income Taxes, we apply an estimated annual effective tax rate to year-to-date ordinary income. At the end of each interim period, we estimate the effective tax rate expected to be applicable for the full fiscal year. This method differs from that described in Note 1 to the Consolidated Financial Statements in our 2017 Annual Report on Form 10-K, which describes our annual significant income tax accounting policy and related methodology. Refer to Note 1 to the Consolidated Financial Statements in our 2017 Annual Report on Form 10-K regarding additional significant accounting policies. Recently Adopted Accounting Standards Statement of Cash Flows — Restricted Cash (ASU 2016-18) As of December 31, 2017, we elected to early-adopt Accounting Standards Update (ASU) 2016-18. The amendments in this update require that amounts classified as restricted cash and restricted cash equivalents be included within the beginning-of-period and end-of-period amounts along with cash and cash equivalents on the statement of cash flows. The amendments were applied retrospectively to all periods presented within the statement of cash flows. The implementation of this guidance resulted in a change in presentation of our Condensed Consolidated Statement of Cash Flows and additional disclosures surrounding restricted cash balances, but did not result in a change to our Condensed Consolidated Statement of Comprehensive Income or Condensed Consolidated Balance Sheet. Revenue from Contracts with Customers (ASU 2014-09) In May 2014, the Financial Accounting Standards Board (FASB) issued ASU 2014-09. The purpose of this guidance is to streamline and consolidate existing revenue recognition principles in GAAP and to converge revenue recognition principles with International Financial Reporting Standards. The core principle of the amendments is that an entity should recognize revenue to depict the transfer of promised goods or services to customers in an amount that reflects the consideration to which the entity expects to be entitled to receive in exchange for those goods or services. The amendments include a five step process for consideration of the core principle, guidance on the accounting treatment for costs associated with a contract, and disclosure requirements related to the revenue process. The FASB issued several additional ASUs to clarify guidance and provide implementation support for ASU 2014-09. The clarifying guidance elaborates on the key concepts within ASU 2014-09 and clarifies how those concepts interact with other GAAP requirements. On January 1, 2018, we adopted ASU 2014-09 and all subsequent ASUs that modified ASU 2014-09 (collectively, the amendments to the revenue recognition principles), which have been codified in ASC 606, Revenue from Contracts with Customers, and ASC 610-20, Gains and Losses from the Derecognition of Nonfinancial Assets, respectively. We elected to adopt this guidance using the modified retrospective approach applied to all contracts with customers that were not completed as of January 1, 2018. The adoption of the amendments resulted in a reduction to our opening retained earnings of approximately $126 million, net of income taxes. Refer to Note 2 for further details. Financial Instruments — Recognition and Measurement of Financial Assets (ASU 2016-01) As of January 1, 2018, we adopted ASU 2016-01. The amendments in this update modify the requirements related to the measurement of certain financial instruments in the statement of financial condition and results of operations. The FASB subsequently issued ASU 2018-03 to clarify guidance and provide implementation support for ASU 2016-01, which we elected to early-adopt as of January 1, 2018, to align with the adoption of ASU 2016-01. For equity investments (other than investments accounted for using the equity method), entities must measure such instruments at fair value with changes in fair value recognized in net income. Changes in fair value for equity securities are no longer recognized through other comprehensive (loss) income, which creates additional volatility in our Condensed Consolidated Statement of Comprehensive Income. Reporting entities may continue to elect to measure certain equity investments that do not have a readily determinable fair value at cost with adjustments for impairment and observable changes in price. In addition, for a liability (other than a derivative liability) that an entity measures at fair value, any change in fair value related to the instrument-specific credit risk, that is the entity’s own-credit, should be presented separately in other comprehensive (loss) income and not as a component of net income. We adopted these amendments, as required, on a modified retrospective basis with a cumulative effect adjustment as of the beginning of the fiscal year of initial adoption. The adoption of the amendments resulted in a reduction to our opening retained earnings of approximately $20 million, net of income taxes. Derivatives and Hedging — Targeted Improvements to Accounting for Hedging Activities (ASU 2017-12) As of January 1, 2018, we elected to early-adopt ASU 2017-12. The amendments in this update enhance the financial reporting of hedging relationships to better align hedge accounting with an entity’s risk management activities. This update also makes certain targeted improvements to simplify the application of the hedge accounting guidance in current GAAP and better portrays economic results through changes to both the designation and measurement guidance for qualifying hedging relationships and presentation of hedge results. We adopted the amendments to all cash flow and net investment hedge relationships that existed on the date of adoption using a modified retrospective approach. No cumulative effect adjustment to our opening retained earnings was required as a result of the adoption. The presentation and disclosure requirements included in this update were adopted prospectively. Refer to Note 18 for further details. Accumulated Other Comprehensive Income — Reclassification of Certain Tax Effects (ASU 2018-02) In February 2018, the FASB issued ASU 2018-02. The amendments in this update provide guidance concerning the treatment of the impact of income tax effects resulting from the Tax Cuts and Jobs Act of 2017 (the Tax Act) on items included in accumulated other comprehensive income. Our policy is to use the portfolio method with respect to reclassification of stranded income tax effects in accumulated other comprehensive loss. The amendments in ASU 2018-02 provide entities an election to reclassify the income tax effect of the Tax Act from accumulated other comprehensive income to retained earnings. We elected to early-adopt this standard as of January 1, 2018, and reclassified the effect of the change in the federal corporate income tax rate on items included in accumulated other comprehensive loss. This election resulted in a reclassification of $42 million from accumulated other comprehensive loss to retained earnings. Recently Issued Accounting Standards Leases (ASU 2016-02) In February 2016, the FASB issued ASU 2016-02. The amendments in this update primarily replace the existing accounting requirements for operating leases for lessees. Lessee accounting requirements for finance leases and lessor accounting requirements for operating leases and sales type and direct financing leases (sales-type and direct financing leases were both previously referred to as capital leases) are largely unchanged. The amendments require the lessee of an operating lease to record a balance sheet gross-up upon lease commencement by recognizing a right-of-use asset and lease liability equal to the present value of the lease payments. The right-of-use asset and lease liability should be derecognized in a manner that effectively yields a straight line lease expense over the lease term. In addition to the changes to the lessee operating lease accounting requirements, the amendments also change the types of costs that can be capitalized related to a lease agreement for both lessees and lessors for all types of leases. The amendments also require additional disclosures for all lease types for both lessees and lessors. The amendments are effective on January 1, 2019, with early adoption permitted. The amendments must be applied on a modified retrospective basis with a cumulative adjustment to the beginning of the earliest fiscal year presented in the financial statements in the period of adoption. We are currently in the process of reviewing our lease contracts and examining the practical expedients and accounting policy elections provided in the amendments, as well as ensuring our control environment and reporting processes reflect the requirements of the amendments. Upon adoption, our balance sheet will include a right-of-use asset and lease liability for our operating leases where we are the lessee, which primarily include our facilities leases. In addition, we will no longer capitalize certain initial direct costs in connection with lease originations where we are the lessor. We do not anticipate the adoption of these amendments will have a material impact to our financial statements. We currently plan to adopt these amendments on January 1, 2019, and expect to use the modified retrospective approach as currently required. Financial Instruments — Credit Losses (ASU 2016-13) In June 2016, the FASB issued ASU 2016-13. The amendments in this update introduce a new accounting model to measure credit losses for financial assets measured at amortized cost. Credit losses for financial assets measured at amortized cost should be determined based on the total current expected credit losses over the life of the financial asset or group of financial assets. In effect, the financial asset or group of financial assets should be presented at the net amount expected to be collected. Credit losses will no longer be recorded under the current incurred loss model for financial assets measured at amortized cost. The amendments also modify the accounting for available-for-sale debt securities whereby credit losses will be recorded through an allowance for credit losses rather than a write-down to the security’s cost basis, which allows for reversals of credit losses when estimated credit losses decline. Credit losses for available-for-sale debt securities should be measured in a manner similar to current GAAP. The amendments are effective on January 1, 2020, with early adoption permitted as of January 1, 2019. The amendments must be applied using a modified retrospective approach with a cumulative-effect adjustment through retained earnings as of the beginning of the fiscal year upon adoption. The new accounting model for credit losses represents a significant departure from existing GAAP, and will likely materially increase the allowance for credit losses with a resulting negative adjustment to retained earnings. The amount of the change in the allowance for credit losses will also be impacted by the composition of our portfolio at the adoption date, as well as economic conditions and forecasts at that time. Management created a cross-functional working group to govern the implementation of these amendments, including consideration of model development, data integrity, technology, reporting and disclosure requirements, key accounting interpretations, control environment, and corporate governance. We are in the process of designing and building the models and procedures that will be used to calculate the credit loss reserves in accordance with these amendments. We currently plan to adopt these amendments on January 1, 2020, and expect to use the modified retrospective approach as required. Receivables — Nonrefundable Fees and Other Costs: Premium Amortization on Purchased Callable Debt Securities (ASU 2017-08) In March 2017, the FASB issued ASU 2017-08. The amendments in this update require premiums on purchased callable debt securities to be amortized to the security’s earliest call date. Prior to this ASU, premiums and discounts on purchased callable debt securities were generally required to be amortized to the security’s maturity date. The amendments do not require an accounting change for securities held at a discount. The amendments are effective on January 1, 2019, with early adoption permitted. The amendments must be applied using a modified retrospective approach with a cumulative-effect adjustment through retained earnings as of the beginning of the fiscal year upon adoption. While our assessment is not final, we do not expect the amendments to have a material impact to our financial statements and are currently in the process of ensuring our control environment and reporting processes reflect the requirements of the amendments. We currently plan to adopt these amendments on January 1, 2019, and expect to use the modified retrospective approach as required. |
Revenue from Contracts with Customers |
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Revenue from Contract with Customer [Text Block] | Revenue from Contracts with Customers On January 1, 2018, we adopted the amendments to the revenue recognition principles using the modified retrospective approach applied to contracts with customers outstanding as of the date of adoption. Results for reporting periods beginning after January 1, 2018, are presented in accordance with the amendments to the revenue recognition principles, while prior period amounts have not been adjusted and continue to be presented in accordance with the accounting standards in effect for those periods. Refer to Note 1 for additional information. Our primary revenue sources, which include financing revenue and other interest income, are addressed by other GAAP and are not in the scope of the amendments to the revenue recognition principles. As part of our Insurance operations, we recognize revenue from insurance contracts, which are addressed by other GAAP and are not included in the scope of the amendments to the revenue recognition principles. Certain noninsurance contracts within our Insurance operations, including vehicle service contracts (VSCs), guaranteed asset protection (GAP) contracts, and vehicle maintenance contracts (VMCs), are included in the scope of the amendments to the revenue recognition principles. Under the previous guidance, a portion of revenue earned on noninsurance contracts was recognized at contract inception, while the remainder was recognized over the contract term on a basis proportionate to the anticipated cost emergence. In addition, dealer and sales commissions incurred to obtain a noninsurance contract were recognized as expense when incurred, and certain direct-response advertising costs were deferred and recognized as expense over the term of the contract. Upon adoption of the amendments to the revenue recognition principles, all revenue associated with noninsurance contracts is recognized over the contract term on a basis proportionate to the anticipated cost emergence. Further, commissions and sales expense incurred to obtain these contracts are capitalized and recognized as expense over the contract term, and all advertising costs are recognized as expense when incurred. The following table presents the impact to our Condensed Consolidated Balance Sheet as of January 1, 2018, as a result of adopting the amendments to the revenue recognition principles.
The following tables present the impact of adopting the amendments to the revenue recognition principles to our Condensed Consolidated Statement of Comprehensive Income and Condensed Consolidated Balance Sheet.
The following is a description of our primary revenue sources that are derived from contracts with customers. As a result of the adoption of the amendments to the revenue recognition principles, our only revenue source for which the recognition pattern was affected was that of noninsurance contracts, as described in this note. Revenue from contracts with customers is recognized when control of the promised goods or services is transferred to our customers, and in an amount that reflects the consideration that we expect to receive in exchange for those goods or services. For information regarding our revenue recognition policies outside the scope of the amendments to the revenue recognition principles of ASC 606, Revenue from Contracts with Customers, refer to Note 1 to the Consolidated Financial Statements in our 2017 Annual Report on Form 10-K.
The following table presents a disaggregated view of our revenue from contracts with customers included in other revenue that falls within the scope of the amendments to the revenue recognition principles.
In addition to the components of other revenue presented above, as part of our Automotive Finance operations, we recognized gains of $16 million and $34 million for the three months and six months ended June 30, 2018, respectively, on the sale of off-lease vehicles. These gains are included in depreciation expense on operating lease assets in our Condensed Consolidated Statement of Comprehensive Income. |
Other Income, Net of Losses |
6 Months Ended | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
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Jun. 30, 2018 | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Other Nonoperating Income (Expense) [Abstract] | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Other Income and Other Expense Disclosure [Text Block] | Other Income, Net of Losses Details of other income, net of losses, were as follows.
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Reserves for Insurance Losses and Loss Adjustment Expenses |
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Jun. 30, 2018 | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Reserves for Insurance Losses and Loss Adjustment Expense [Abstract] | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Reserves for Insurance Losses and Loss Adjustment Expenses [Text Block] | Reserves for Insurance Losses and Loss Adjustment Expenses The following table shows a rollforward of our reserves for insurance losses and loss adjustment expenses.
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Other Operating Expenses |
6 Months Ended | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
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Jun. 30, 2018 | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Operating Expenses [Abstract] | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Other Operating Income and Expense [Text Block] | Other Operating Expenses Details of other operating expenses were as follows.
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Investment Securities |
6 Months Ended | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
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Investments, Debt and Equity Securities [Abstract] | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Investments in Debt and Marketable Equity Securities (and Certain Trading Assets) Disclosure [Text Block] | Investment Securities Our portfolio of available-for-sale and held-to-maturity debt securities includes bonds, asset-backed securities, commercial and residential mortgage-backed securities, and other investments. We also hold equity securities. The cost, fair value, and gross unrealized gains and losses on available-for-sale and held-to-maturity investment securities were as follows.
The maturity distribution of debt securities outstanding is summarized in the following tables. Call or prepayment options may cause actual maturities to differ from contractual maturities.
The balances of cash equivalents were $54 million and $10 million at June 30, 2018, and December 31, 2017, respectively, and were composed primarily of money market accounts and short-term securities, including U.S. Treasury bills. The following table presents interest and dividends on investment securities.
The following table presents gross gains and losses realized upon the sales of available-for-sale securities, and net gains or losses on equity securities held during the period. There were no other-than-temporary impairments of available-for-sale securities for either period.
The table below summarizes available-for-sale and held-to-maturity securities in an unrealized loss position, which we evaluated for other than temporary impairment applying the methodology described in Note 1. As of June 30, 2018, we did not have the intent to sell the available-for-sale or held-to-maturity securities with an unrealized loss position and we do not believe it is more likely than not that we will be required to sell these securities before recovery of their amortized cost basis. As a result of this evaluation, we believe that the securities with an unrealized loss position are not considered to be other-than-temporarily impaired at June 30, 2018.
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Finance Receivables and Loans, Net |
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Loans and Leases Receivable, Net Amount [Abstract] | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Loans, Notes, Trade and Other Receivables Disclosure [Text Block] | Finance Receivables and Loans, Net The composition of finance receivables and loans reported at gross carrying value was as follows.
The following tables present an analysis of the activity in the allowance for loan losses on finance receivables and loans.
The following table presents information about significant sales of finance receivables and loans and transfers of finance receivables and loans from held-for-investment to held-for-sale based on net carrying value.
The following table presents information about significant purchases of finance receivables and loans based on unpaid principal balance at the time of purchase.
The following table presents an analysis of our past due finance receivables and loans recorded at gross carrying value.
The following table presents the gross carrying value of our finance receivables and loans on nonaccrual status.
Management performs a quarterly analysis of the consumer automotive, consumer mortgage, and commercial portfolios using a range of credit quality indicators to assess the adequacy of the allowance for loan losses based on historical and current trends. The following tables present the population of loans by quality indicators for our consumer automotive, consumer mortgage, and commercial portfolios. The following table presents performing and nonperforming credit quality indicators in accordance with our internal accounting policies for our consumer finance receivables and loans recorded at gross carrying value. Nonperforming loans include finance receivables and loans on nonaccrual status when the principal or interest has been delinquent for 90 days or when full collection is not expected. Refer to Note 1 to the Consolidated Financial Statements in our 2017 Annual Report on Form 10-K for additional information.
The following table presents pass and criticized credit quality indicators based on regulatory definitions for our commercial finance receivables and loans recorded at gross carrying value.
Impaired Loans and Troubled Debt Restructurings Impaired Loans Loans are considered impaired when we determine it is probable that we will be unable to collect all amounts due according to the terms of the loan agreement. For more information on our impaired finance receivables and loans, refer to Note 1 to the Consolidated Financial Statements in our 2017 Annual Report on Form 10-K. The following table presents information about our impaired finance receivables and loans.
The following tables present average balance and interest income for our impaired finance receivables and loans.
Troubled Debt Restructurings Troubled Debt Restructurings (TDRs) are loan modifications where concessions were granted to borrowers experiencing financial difficulties. For automotive loans, we may offer several types of assistance to aid our customers, including extension of the loan maturity date and rewriting the loan terms. Additionally, for mortgage loans, as part of certain programs, we offer mortgage loan modifications to qualified borrowers. These programs are in place to provide support to our mortgage customers in financial distress, including principal forgiveness, maturity extensions, delinquent interest capitalization, and changes to contractual interest rates. Total TDRs recorded at gross carrying value were $791 million and $712 million at June 30, 2018, and December 31, 2017, respectively. Total commitments to lend additional funds to borrowers whose terms had been modified in a TDR were $7 million and $6 million at June 30, 2018, and December 31, 2017, respectively. Refer to Note 1 to the Consolidated Financial Statements in our 2017 Annual Report on Form 10-K for additional information. The following tables present information related to finance receivables and loans recorded at gross carrying value modified in connection with a TDR during the period.
The following tables present information about finance receivables and loans recorded at gross carrying value that have redefaulted during the reporting period and were within 12 months or less of being modified as a TDR. Redefault is when finance receivables and loans meet the requirements for evaluation under our charge-off policy (refer to Note 1 to the Consolidated Financial Statements in our 2017 Annual Report on Form 10-K for additional information) except for commercial finance receivables and loans, where redefault is defined as 90 days past due.
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Investment in Operating Leases, Net |
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Lessor, Operating Leases [Text Block] | Investment in Operating Leases, Net Investments in operating leases were as follows.
Depreciation expense on operating lease assets includes remarketing gains and losses recognized on the sale of operating lease assets. The following summarizes the components of depreciation expense on operating lease assets.
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Securitizations and Variable Interest Entities |
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Securitizations And Variable Interest Entities [Abstract] | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Variable Interest Entity Disclosure [Text Block] | Securitizations and Variable Interest Entities We securitize, transfer, and service consumer and commercial automotive loans, and operating leases. We often securitize these loans and notes secured by operating leases (collectively referred to as financial assets) through the use of special-purpose entities (SPEs). A SPE is a legal entity that is designed to fulfill a specified limited need of the sponsor. Our principal use of SPEs is to obtain liquidity by securitizing certain of our financial assets and operating lease assets which may, or may not, be included on our Condensed Consolidated Balance Sheet. The transaction-specific SPEs involved in our securitization transactions are often considered VIEs. VIEs are entities that have either a total equity investment at risk that is insufficient to permit the entity to finance its activities without additional subordinated financial support or whose equity investors at risk lack the ability to control the entity’s activities. The nature, purpose, and activities of nonconsolidated securitization entities are similar to those of our consolidated securitization entities with the primary difference being the nature and extent of our continuing involvement. Additionally, to qualify for off-balance sheet treatment, transfers of financial assets must meet appropriate sale accounting conditions. For nonconsolidated securitization entities, the transferred financial assets are removed from our balance sheet provided the conditions for sale accounting are met. The financial assets obtained from the securitization are primarily reported as cash, or retained interests (if applicable). Liabilities incurred as part of these securitization transactions, such as representation and warranty provisions, are recorded at fair value at the time of sale and are reported as accrued expenses and other liabilities on our Consolidated Balance Sheet. Upon the sale of the loans, we recognize a gain or loss on sale for the difference between the assets recognized, the assets derecognized, and the liabilities recognized as part of the transaction. We had no pretax gain on sales of financial assets into nonconsolidated VIEs for both the three months and six months ended June 30, 2018, and the three months ended June 30, 2017. We had a pretax gain of $2 million for the six months ended June 30, 2017. We provide long-term guarantee contracts to investors in certain nonconsolidated affordable housing entities and have extended a line of credit to provide liquidity. Since we do not have control over the entities or the power to make decisions, we do not consolidate the entities and our involvement is limited to the guarantee and the line of credit. We have involvement with various other nonconsolidated equity investments, including affordable housing entities and venture capital funds and loan funds. We do not consolidate these entities and our involvement is limited to our outstanding investment, additional capital committed to these funds plus any previously recognized low income housing tax credits that are subject to recapture. Refer to Note 11 to the Consolidated Financial Statements in our 2017 Annual Report on Form 10-K for further description of our securitization activities and our involvement with VIEs. The following table presents our involvement in consolidated and nonconsolidated VIEs in which we hold variable interests. For additional detail related to the assets and liabilities of consolidated variable interest entities refer to the Condensed Consolidated Balance Sheet.
Cash Flows with Off-balance Sheet Securitization Entities The following table summarizes cash flows received and paid related to securitization entities and asset-backed financings where the transfer is accounted for as a sale and we have a continuing involvement with the transferred consumer automotive assets (e.g., servicing) that were outstanding during the six months ended June 30, 2018, and 2017. Additionally, this table contains information regarding cash flows received from and paid to nonconsolidated securitization entities that existed during each period.
Delinquencies and Net Credit Losses The following tables present quantitative information about delinquencies and net credit losses for off-balance sheet securitizations and whole-loan sales where we have continuing involvement.
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Servicing Asset [Abstract] | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Servicing Activities [Text Block] | Servicing Activities Automotive Finance Servicing Activities We service consumer automotive contracts. Historically, we have sold a portion of our consumer automotive contracts. With respect to contracts we sell, we generally retain the right to service and earn a servicing fee for our servicing function. We have concluded that the fee we are paid for servicing consumer automotive finance receivables represents adequate compensation, and consequently, we do not recognize a servicing asset or liability. We recognized automotive servicing fee income of $8 million and $16 million during the three months and six months ended June 30, 2018, respectively, compared to $14 million and $30 million during the three months and six months ended June 30, 2017. Automotive Finance Serviced Assets The current unpaid principal balance and any related unamortized deferred fees and costs of total serviced automotive finance loans and net investment in operating leases outstanding were as follows.
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Other Assets Disclosure [Text Block] | Other Assets The components of other assets were as follows.
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Deposit Liabilities Disclosures [Text Block] | Deposit Liabilities Deposit liabilities consisted of the following.
At June 30, 2018, and December 31, 2017, certificates of deposit included $19.9 billion and $18.9 billion, respectively, of those in denominations of $100 thousand or more. At both June 30, 2018, and December 31, 2017, certificates of deposit included $5.3 billion of those in denominations in excess of $250 thousand federal insurance limits. |
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Debt Disclosure [Text Block] | Debt Short-term Borrowings The following table presents the composition of our short-term borrowings portfolio.
We periodically enter into term repurchase agreements, short-term borrowing agreements in which we sell financial instruments to one or more investors while simultaneously committing to repurchase them at a specified future date, at the stated price plus accrued interest. As of June 30, 2018, the financial instruments sold under agreements to repurchase consisted of $276 million of U.S. Treasury and $691 million of agency mortgage-backed residential debt securities set to mature as follows: $530 million within 30 days, and $437 million within 61 to 90 days. Refer to Note 6 and Note 21 for further details. The primary risk associated with these repurchase agreements is that the counterparty will be unable to perform under the terms of the contract. As the borrower, we are exposed to the excess market value of the securities pledged over the amount borrowed. Daily mark-to-market collateral management is designed to limit this risk to the initial margin. However, should a counterparty declare bankruptcy or become insolvent, we may incur additional delays and costs. In some instances, we may place or receive cash collateral with counterparties under collateral arrangements associated with our repurchase agreements. At June 30, 2018, we placed cash collateral totaling $4 million and received cash collateral totaling $1 million and noncash collateral totaling $1 million. At December 31, 2017, we placed cash collateral totaling $10 million and received cash collateral totaling $1 million. Long-term Debt The following table presents the composition of our long-term debt portfolio.
The following table presents the scheduled remaining maturity of long-term debt at June 30, 2018, assuming no early redemptions will occur. The actual payment of secured debt may vary based on the payment activity of the related pledged assets.
The following summarizes assets restricted as collateral for the payment of the related debt obligation primarily arising from securitization transactions accounted for as secured borrowings and repurchase agreements.
Trust Preferred Securities At June 30, 2018, we have issued and outstanding approximately $2.6 billion in aggregate liquidation preference of 8.125% Fixed Rate/Floating Rate Trust Preferred Securities, Series 2 (Series 2 TRUPS). Each Series 2 TRUPS security has a liquidation amount of $25. Distributions are cumulative and are payable until redemption at the applicable coupon rate. Distributions are payable at an annual rate equal to three-month London interbank offer rate plus 5.785% payable quarterly in arrears. Ally has the right to defer payments of interest for a period not exceeding 20 consecutive quarters. The Series 2 TRUPS have no stated maturity date, but must be redeemed upon the redemption or maturity of the related debentures (Debentures), which mature on February 15, 2040. Ally at any time may redeem the Series 2 TRUPS at a redemption price equal to 100% of the principal amount being redeemed, plus accrued and unpaid interest through the date of redemption. The Series 2 TRUPS are generally nonvoting, other than with respect to certain limited matters. During any period in which any Series 2 TRUPS remain outstanding but in which distributions on the Series 2 TRUPS have not been fully paid, none of Ally or its subsidiaries will be permitted to (i) declare or pay dividends on, make any distributions with respect to, or redeem, purchase, acquire or otherwise make a liquidation payment with respect to, any of Ally’s capital stock or make any guarantee payment with respect thereto; or (ii) make any payments of principal, interest, or premium on, or repay, repurchase or redeem, any debt securities or guarantees that rank on a parity with or junior in interest to the Debentures with certain specified exceptions in each case. Funding Facilities We utilize both committed credit facilities and other collateralized funding vehicles. The debt outstanding under our various funding facilities is included on our Condensed Consolidated Balance Sheet. As of June 30, 2018, Ally Bank had exclusive access to $2.5 billion of funding capacity from committed credit facilities. Funding programs supported by the FRB and the FHLB complement Ally Bank’s private collateralized funding vehicles. The total capacity in our committed funding facilities is provided by banks through private transactions. The committed secured funding facilities can be revolving in nature and allow for additional funding during the commitment period, or they can be amortizing and not allow for any further funding after the closing date. At June 30, 2018, all of our $9.2 billion of committed capacity was revolving. Our revolving facilities generally have an original tenor ranging from 364 days to two years. As of June 30, 2018, we had $7.6 billion of committed funding capacity from revolving facilities with a remaining tenor greater than 364 days. Committed Funding Facilities
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Accrued Expenses and Other Liabilities |
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Accounts Payable and Accrued Liabilities Disclosure [Text Block] | Accrued Expenses and Other Liabilities The components of accrued expenses and other liabilities were as follows.
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Accumulated Other Comprehensive Loss |
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Other Comprehensive Income (Loss), Net of Tax [Abstract] | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Comprehensive Income (Loss) Note [Text Block] | Accumulated Other Comprehensive Loss The following table presents changes, net of tax, in each component of accumulated other comprehensive loss.
The following tables present the before- and after-tax changes in each component of accumulated other comprehensive (loss) income.
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Earnings per Common Share |
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Earnings Per Share [Abstract] | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Earnings Per Share [Text Block] | Earnings per Common Share The following table presents the calculation of basic and diluted earnings per common share.
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Regulatory Capital and Other Regulatory Matters |
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Regulatory Capital Requirements under Banking Regulations [Text Block] | Regulatory Capital and Other Regulatory Matters The FRB and other U.S. banking agencies have adopted risk-based and leverage capital standards that establish minimum capital-to-asset ratios for BHCs, like Ally, and depository institutions, like Ally Bank. The risk-based capital ratios are based on a banking organization’s risk-weighted assets (RWAs), which are generally determined under the Basel III standardized approach applicable to Ally and Ally Bank by (1) assigning on-balance sheet exposures to broad risk weight categories according to the counterparty or, if relevant, the guarantor or collateral (with higher risk weights assigned to categories of exposures perceived as representing greater risk), and (2) multiplying off-balance sheet exposures by specified credit conversion factors to calculate credit equivalent amounts and assigning those credit equivalent amounts to the relevant risk weight categories. The leverage ratio, in contrast, is based on an institution’s average unweighted on-balance sheet exposures. Ally and Ally Bank are subject to capital requirements issued by U.S. banking regulators that require us to maintain risk-based and leverage capital ratios above minimum levels. As of January 1, 2015, Ally and Ally Bank became subject to the rules implementing the 2010 Basel III capital framework in the United States (U.S. Basel III), which generally reflects higher capital requirements, capital buffers, and changes to regulatory capital definitions, deductions and adjustments, relative to the predecessor requirements implementing the Basel I capital framework in the United States. Certain aspects of U.S. Basel III, including the capital buffers are subject to a phase-in period through December 31, 2018. Failure to meet minimum capital requirements can initiate certain mandatory and possibly additional discretionary action by regulators that, if undertaken, could have a direct material effect on the Condensed Consolidated Financial Statements or the results of operations and financial condition of Ally and Ally Bank. Under capital adequacy guidelines and the regulatory framework for prompt corrective action, we and Ally Bank must meet specific capital guidelines that involve quantitative measures of capital, assets and certain off-balance sheet items. These measures and related classifications, which are used in the calculation of our risk-based and leverage capital ratios and those of Ally Bank, are also subject to qualitative judgments by the regulators about the components of capital, the risk-weightings of assets and other exposures, and other factors. The FRB also uses these ratios and guidelines as part of the capital planning and stress testing processes. In addition, in order for Ally to maintain its status as an FHC, Ally and its bank subsidiary, Ally Bank, must remain well capitalized and well managed, as defined under applicable laws. The well capitalized standard for insured depository institutions, such as Ally Bank, reflects the capital requirements under U.S. Basel III. Under U.S. Basel III, Ally and Ally Bank must maintain a minimum Common Equity Tier 1 risk-based capital ratio of 4.5%, a minimum Tier 1 risk-based capital ratio of 6%, and a minimum total risk-based capital ratio of 8%. In addition to these minimum risk-based capital ratios, Ally and Ally Bank are also subject to a Common Equity Tier 1 capital conservation buffer of more than 2.5%, subject to a phase-in period from January 1, 2016, through December 31, 2018. Failure to maintain the full amount of the buffer would result in restrictions on the ability of Ally and Ally Bank to make capital distributions, including dividend payments and stock repurchases and redemptions, and to pay discretionary bonuses to executive officers. U.S. Basel III also subjects Ally and Ally Bank to a minimum Tier 1 leverage ratio of 4%. U.S. Basel III also revised the eligibility criteria for regulatory capital instruments and provides for the phase-out of instruments that had previously been recognized as capital but that do not satisfy these criteria. For example, subject to certain exceptions (e.g., certain debt or equity issued to the U.S. government under the Emergency Economic Stabilization Act), trust preferred and other hybrid securities were excluded from a BHC’s Tier 1 capital as of January 1, 2016. Also, subject to a phase-in schedule, certain items are deducted from Common Equity Tier 1 capital under U.S. Basel III that had not previously been deducted from regulatory capital, and certain other deductions from regulatory capital have been modified. Among other things, U.S. Basel III requires significant investments in the common stock of unconsolidated financial institutions, mortgage servicing assets, and certain deferred tax assets that exceed specified individual and aggregate thresholds to be deducted from Common Equity Tier 1 capital. U.S. Basel III also revised the standardized approach for calculating RWAs by, among other things, modifying certain risk weights and the methods for calculating RWAs for certain types of assets and exposures. Ally and Ally Bank are subject to the U.S. Basel III standardized approach for counterparty credit risk, but not to the U.S. Basel III advanced approaches for credit risk or operational risk. Ally is also not subject to the U.S. market risk capital rule, which applies only to banking organizations with significant trading assets and liabilities. On May 24, 2018, the Economic Growth, Regulatory Relief, and Consumer Protection Act was enacted. This legislation includes targeted amendments to the Dodd-Frank Wall Street Reform and Consumer Protection Act of 2010 and other financial services laws, including amendments that affect whether and, if so, how the FRB applies enhanced prudential standards to BHCs like us with total consolidated assets equal to or greater than $100 billion and less than $250 billion. While we currently anticipate that this legislation may result in regulatory and supervisory frameworks that are more tailored to our risk profile, such a result generally depends on future action by the U.S. banking agencies and, as a result, cannot be predicted with any certainty. On April 13, 2018, the FRB and other U.S. banking agencies proposed a revision to their regulatory capital rules to address the regulatory capital treatment related to ASU 2016-13, which Ally plans to adopt effective January 1, 2020, as further described in Note 1. We expect the implementation of ASU 2016-13 will significantly increase our allowance for credit losses upon adoption. If finalized, the proposed changes to the regulatory capital rules would allow Ally to phase in the impact to our regulatory capital as a result of the increase to our allowance for credit losses on a straight-line basis over a three-year period. In addition, the U.S. banking agencies are proposing to make amendments to the stress testing regulations that would exclude the impact of the adoption of ASU 2016-13 until the 2020 stress testing cycle. We continue to monitor and evaluate these regulatory developments. Until the U.S. banking agencies decide whether and, if so, how to amend their regulatory capital rules to account for ASU 2016-13, its ultimate impact on our regulatory capital and, therefore, our business, results of operations, and financial condition is unclear. On April 10, 2018, the FRB issued a proposal that would seek to more closely align forward-looking stress testing results with the FRB’s non-stress capital requirements for banking organizations with $50 billion or more in assets. The proposal would introduce a “stress capital buffer” based on firm-specific stress test performance, which would effectively replace the capital conservation buffer for determining non-stress capital requirements. The proposal would also incorporate several other changes to the CCAR process including eliminating the CCAR quantitative objection, narrowing the set of planned capital actions assumed to occur in the stress scenario and eliminating the thirty percent dividend payout ratio as a criterion for heightened scrutiny of a firm’s capital plan, among other proposed changes. If finalized, the rule would be effective on December 31, 2018, and a firm’s first stress buffer requirements would generally be effective on October 1, 2019. We are currently evaluating the effect this proposal will have on our capital planning and stress testing requirements. In December 2017, the Basel Committee approved revisions to the global Basel III capital framework (commonly known as Basel IV), many of which—if adopted in the United States—could heighten regulatory capital standards even more. At this time, it is not clear how all of these proposals and revisions will be harmonized and finalized in the United States. On March 7, 2016, Ally Bank received approval from the FRB to become a state member bank. Ally Bank is now regulated by the FRB through the Federal Reserve Bank of Chicago, as well as the Utah Department of Financial Institutions (UDFI). As a requirement of FRB membership, we held $447 million of FRB stock at June 30, 2018. In addition, in connection with the application for membership in the Federal Reserve System, Ally Bank made commitments to the FRB relating to capital, liquidity, and business plan requirements. These commitments were consistent with the prior requirements under the now-terminated Capital and Liquidity Maintenance Agreement with the Federal Deposit Insurance Corporation (FDIC), including the requirement to maintain capital at a level such that Ally Bank’s Tier 1 leverage ratio was at least 15%. On August 22, 2017, banking agencies lifted the capital, liquidity, and business plan commitments that Ally Bank had made in connection with its application for membership in the Federal Reserve System, including the commitment to maintain a Tier 1 leverage ratio of at least 15%. Compliance with capital requirements is a strategic priority for Ally. We expect to be in compliance with all applicable requirements within the established timeframes. The following table summarizes our capital ratios under the U.S. Basel III capital framework.
At June 30, 2018, Ally and Ally Bank were “well-capitalized” and met all applicable capital requirements to which each was subject. Capital Planning and Stress Tests Ally is required to conduct semi-annual company-run stress tests, is subject to an annual supervisory stress test conducted by the FRB, and must submit a proposed capital plan to the FRB. Ally’s proposed capital plan must include an assessment of our expected uses and sources of capital and a description of all planned capital actions over a nine-quarter planning horizon, including any issuance of a debt or equity capital instrument, any dividend or other capital distribution, and any similar action that the FRB determines could have an impact on Ally’s capital. The proposed capital plan must also include a discussion of how Ally, under expected and stressful conditions, will maintain capital commensurate with its risks and above the minimum regulatory capital ratios, and serve as a source of strength to Ally Bank. The FRB will either object to Ally’s proposed capital plan, in whole or in part, or provide a notice of non-objection to Ally’s proposed capital plan, and must do so before Ally may take any capital action. In addition, even if the FRB does not object to our capital plan, Ally may be precluded from or limited in paying dividends or other capital distributions without the FRB’s approval under certain circumstances—for example, when we would not meet minimum regulatory capital ratios and capital buffers after giving effect to the distributions. As part of the 2017 Comprehensive Capital Analysis and Review (CCAR) process, we received a non-objection to our capital plan from the FRB, including the proposed capital actions contained in our submission. The capital actions included increases in the quarterly cash dividend on common stock and in our share repurchase program. The following table presents information related to our common stock for each quarter since the commencement of our common stock repurchase programs and initiation of a quarterly cash dividend on common stock.
Ally submitted its 2018 capital plan and stress test results to the FRB on April 5, 2018. On June 21, 2018, we publicly disclosed summary results of the stress test under the severely adverse scenario in accordance with applicable regulatory requirements. On June 28, 2018, we received from the FRB a non-objection to our capital plan, which includes increases in both our share repurchase program and our planned dividends. Consistent with the capital plan, the Board authorized a 32% increase in our share repurchase program, permitting us to repurchase up to $1.0 billion of our common stock from time to time from the third quarter of 2018 through the second quarter of 2019. Also consistent with the capital plan, on July 13, 2018, the Board declared a quarterly cash dividend of $0.15 per share of our common stock, which is a $0.02 or 15% increase relative to the dividend declared in the prior quarter. Refer to Note 25 for further information on the most recent dividend. Our ability to make capital distributions, including our ability to pay dividends or repurchase shares of our common stock, will continue to be subject to the FRB’s review of and non-objection to the actions that we propose each year in our annual capital plan. The amount and size of any future dividends and share repurchases will depend upon our results of operations, capital levels, future opportunities, consideration and approval by the Board, and other considerations including the degree of severity of stress scenarios assigned by the FRB as part of the CCAR process. In January 2017, the FRB amended the capital planning and stress testing rules, effective for the 2017 cycle and beyond. As a result of this amendment, the FRB may no longer object to the capital plan of a large and noncomplex BHC, like Ally, on the basis of qualitative deficiencies in its capital planning process. Instead, the qualitative assessment of Ally’s capital planning process is now conducted outside of CCAR through the supervisory review process. The amendment also decreased the de minimis threshold for the amount of capital that Ally could distribute to stockholders outside of an approved capital plan without seeking prior approval of the FRB, and modified Ally’s reporting requirements to reduce unnecessary burdens. |
Derivative Instruments and Hedging Activities |
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Derivative Instruments and Hedging Activities Disclosure [Abstract] | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Derivative Instruments and Hedging Activities Disclosure [Text Block] | Derivative Instruments and Hedging Activities We enter into derivative instruments, such as interest rate, foreign-currency, and equity swaps, futures, forwards, and options in connection with our risk management activities. Our primary objective for utilizing derivative financial instruments is to manage interest rate risk associated with our fixed- and variable-rate assets and liabilities, foreign exchange risks related to our foreign-currency denominated assets and liabilities, and market risks related to our investment portfolio. Interest Rate Risk We monitor our mix of fixed- and variable-rate assets and liabilities and may enter into interest rate swaps, forwards, futures, options, and swaptions to achieve our desired mix of fixed- and variable-rate assets and liabilities. We execute these trades to modify our exposure to interest rate risk by converting certain fixed-rate instruments to a variable-rate and certain variable-rate instruments to a fixed-rate. We use a mix of both derivatives that qualify for hedge accounting treatment and economic hedges. Derivatives qualifying for hedge accounting can include receive-fixed swaps designated as fair value hedges of specific fixed-rate unsecured debt obligations, receive-fixed swaps designated as fair value hedges of specific fixed-rate FHLB advances, fair value hedges of securities within our available-for-sale portfolio, and pay-fixed swaps designated as fair value hedges of closed portfolios of fixed-rate held-for-investment retail automotive loan assets in which the hedged item is the last layer expected to be remaining at the end of the hedging relationship. Other derivatives qualifying for hedge accounting consist of pay-fixed swaps designated as cash flow hedges of the expected future cash flows in the form of interest payments on certain variable-rate borrowings and deposit liabilities. We may also execute economic hedges, which consist of interest rate swaps, interest rate caps, forwards, futures, options, and swaptions to mitigate interest rate risk. We also enter into interest rate lock commitments and forward-sale commitments that are executed as part of our mortgage business that meet the accounting definition of a derivative. Foreign Exchange Risk We enter into derivative financial instrument contracts to mitigate the risk associated with variability in cash flows related to our various foreign-currency exposures. We enter into foreign-currency forwards with external counterparties as net investment hedges of foreign exchange exposure on our investments in foreign subsidiaries. Our equity is impacted by the cumulative translation adjustments resulting from the translation of foreign subsidiary results; this impact is reflected in our accumulated other comprehensive loss. We also periodically enter into foreign-currency forwards to economically hedge any foreign-denominated debt, centralized lending, and foreign-denominated third-party loans. These foreign-currency forwards that are used as economic hedges are recorded at fair value with changes recorded as income offsetting the gains and losses on the associated foreign-currency transactions. Market Risk We enter into equity options to economically hedge our exposure to the equity markets. We purchase options to assume a long position on certain equities and write options to assume a short position. Counterparty Credit Risk Derivative financial instruments contain an element of credit risk if counterparties are unable to meet the terms of the agreements. Credit risk associated with derivative financial instruments is measured as the net replacement cost should the counterparties that owe us under the contract completely fail to perform under the terms of those contracts, assuming no recoveries of underlying collateral as measured by the market value of the derivative financial instrument. To mitigate the risk of counterparty default, we maintain collateral agreements with certain counterparties. The agreements generally require both parties to post collateral in the event the fair values of the derivative financial instruments meet posting thresholds established under the agreements. In the event that either party defaults on the obligation, the secured party may seize the collateral. Generally, our collateral arrangements are bilateral such that we and the counterparty post collateral for the value of our total obligation to each other. Contractual terms provide for standard and customary exchange of collateral based on changes in the market value of the outstanding derivatives. The securing party posts additional collateral when their obligation rises or removes collateral when it falls. These payments are characterized as collateral for over-the-counter (OTC) derivatives. We execute certain derivatives such as interest rate swaps with clearinghouses, which requires us to post and receive collateral. For these clearinghouse derivatives, these payments are recognized as settlements rather than collateral. Certain derivative instruments contain provisions that require us to either post additional collateral or immediately settle any outstanding liability balances upon the occurrence of a specified credit-risk-related event. No such specified credit-risk-related events occurred during the three months ended June 30, 2018, or 2017. We placed cash collateral totaling $31 million and noncash collateral totaling $151 million at June 30, 2018, and $20 million and $97 million at December 31, 2017, respectively, in accounts maintained by counterparties. This amount primarily relates to collateral posted to support our derivative positions. This amount also excludes cash and noncash collateral pledged under repurchase agreements. Refer to Note 13 for details on the repurchase agreements. The receivables for cash collateral placed are included on our Condensed Consolidated Balance Sheet in other assets. We received cash collateral from counterparties totaling $38 million and noncash collateral totaling $11 million at June 30, 2018, and $17 million and $2 million at December 31, 2017, respectively, in accounts maintained by counterparties. These amounts exclude cash and noncash collateral pledged under repurchase agreements. Refer to Note 13 for details on repurchase agreements. The payables for cash collateral received are included on our Condensed Consolidated Balance Sheet in accrued expenses and other liabilities. Included in these amounts is noncash collateral where we have been granted the right to sell or pledge the underlying assets. We have not sold or pledged any of the noncash collateral received under these agreements. Balance Sheet Presentation The following table summarizes the amounts of derivative instruments reported on our Condensed Consolidated Balance Sheet. The amounts are presented on a gross basis, are segregated by derivatives that are designated and qualifying as hedging instruments or those that are not, and are further segregated by type of contract within those two categories. Derivative contracts in a receivable and payable position exclude open trade equity on derivatives cleared through central clearing counterparties. Any associated collateral exchanged with our central clearing counterparties are treated as settlements of the derivative exposure, rather than collateral. Such payments are recognized as settlements of the derivatives contracts in a receivable and payable position on our Condensed Consolidated Balance Sheet. Notional amounts are reference amounts from which contractual obligations are derived and are not recorded on the balance sheet. In our view, derivative notional is not an accurate measure of our derivative exposure when viewed in isolation from other factors, such as market rate fluctuations and counterparty credit risk.
The following table presents amounts recorded on our Condensed Consolidated Balance Sheet related to cumulative basis adjustments for fair value hedges.
Statement of Comprehensive Income Presentation The following table summarizes the location and amounts of gains and losses on derivative instruments not designated as accounting hedges reported in our Condensed Consolidated Statement of Comprehensive Income.
The following table summarizes the location and amounts of gains and losses on derivative instruments designated as fair value hedges reported in our Condensed Consolidated Statement of Comprehensive Income. We had no gains or losses on derivative instruments designated as cash flow hedges for the periods shown.
The following table summarizes the location and amounts of gains and losses related to interest and amortization on derivative instruments designated as fair value and cash flow hedges reported in our Condensed Consolidated Statement of Comprehensive Income.
During the next twelve months, we estimate $18 million will be reclassified into pretax earnings from derivatives designated as cash flow hedges. The following table summarizes the effect of cash flow hedges on accumulated other comprehensive loss.
The following table summarizes the effect of net investment hedges on accumulated other comprehensive loss and the Condensed Consolidated Statement of Comprehensive Income.
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Income Tax Disclosure [Abstract] | |
Income Tax Disclosure [Text Block] | Income Taxes We recognized total income tax expense from continuing operations of $113 million and $189 million for the three months and six months ended June 30, 2018, respectively, compared to $122 million and $235 million for the same periods in 2017. The decreases in income tax expense for the three months and six months ended June 30, 2018, compared to the same periods in 2017, were primarily driven by the reduction of the U.S. federal corporate tax rate enacted as a result of the Tax Act. This decrease was partially offset by an increase in pretax earnings, nondeductible FDIC premiums as a result of the Tax Act, and a nonrecurring tax benefit in 2017 from the release of valuation allowance against our capital-in-nature deferred tax assets and foreign tax credit carryforwards. As further described in Note 1, we elected to early-adopt ASU 2018-02 effective January 1, 2018. As a result of this adoption, we reclassified $42 million from accumulated other comprehensive loss to retained earnings, which eliminated the stranded federal income tax effects in accumulated other comprehensive loss resulting from the Tax Act. Our policy is to use the portfolio method with respect to reclassification of stranded income tax effects in accumulated other comprehensive loss. As of each reporting date, we consider existing evidence, both positive and negative, that could impact our view with regard to future realization of deferred tax assets. We continue to believe it is more likely than not that the benefit for certain foreign tax credit carryforwards, state net operating loss carryforwards, and state capital loss carryforwards will not be realized. In recognition of this risk, we continue to provide a partial valuation allowance on the deferred tax assets relating to these carryforwards. |
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Fair Value Disclosures [Abstract] | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Fair Value Disclosures [Text Block] | Fair Value Fair Value Measurements For purposes of this disclosure, fair value is defined as the exchange price that would be received to sell an asset or paid to transfer a liability (exit price) in the principal or most advantageous market in an orderly transaction between market participants at the measurement date under current market conditions. Fair value is based on the assumptions we believe market participants would use when pricing an asset or liability. Additionally, entities are required to consider all aspects of nonperformance risk, including the entity’s own credit standing, when measuring the fair value of a liability. GAAP specifies a three-level hierarchy that is used when measuring and disclosing fair value. The fair value hierarchy gives the highest priority to quoted prices available in active markets (i.e., observable inputs) and the lowest priority to data lacking transparency (i.e., unobservable inputs). An instrument’s categorization within the fair value hierarchy is based on the lowest level of significant input to its valuation. The following is a description of the three hierarchy levels.
The following are descriptions of the valuation methodologies used to measure material assets and liabilities at fair value and details of the valuation models, key inputs to those models, and significant assumptions utilized.
We also execute OTC and centrally-cleared derivative contracts, such as interest rate swaps, swaptions, foreign-currency denominated forward contracts, caps, floors, and agency to-be-announced securities. We utilize third-party-developed valuation models that are widely accepted in the market to value these derivative contracts. The specific terms of the contract and market observable inputs (such as interest rate forward curves, interpolated volatility assumptions, or equity pricing) are used in the model. We classified these derivative contracts as Level 2 because all significant inputs into these models were market observable. We also enter into interest rate lock commitments and forward-sale commitments that are executed as part of our mortgage business, certain of which meet the accounting definition of a derivative and therefore are recorded as derivatives on our Condensed Consolidated Balance Sheet. Because these derivatives are valued using internal pricing models with unobservable inputs, they are classified as Level 3. We are required to consider all aspects of nonperformance risk, including our own credit standing, when measuring fair value of a liability. We reduce credit risk on the majority of our derivatives by entering into legally enforceable agreements that enable the posting and receiving of collateral associated with the fair value of our derivative positions on an ongoing basis. In the event that we do not enter into legally enforceable agreements that enable the posting and receiving of collateral, we will consider our credit risk and the credit risk of our counterparties in the valuation of derivative instruments through a credit valuation adjustment (CVA), if warranted. The CVA calculation utilizes the credit default swap spreads of the counterparty. Recurring Fair Value The following tables display the assets and liabilities measured at fair value on a recurring basis including financial instruments elected for the fair value option. We often economically hedge the fair value change of our assets or liabilities with derivatives and other financial instruments. The tables below display the hedges separately from the hedged items; therefore, they do not directly display the impact of our risk management activities.
The following tables present the reconciliation for all Level 3 assets and liabilities measured at fair value on a recurring basis. We often economically hedge the fair value change of our assets or liabilities with derivatives and other financial instruments. The Level 3 items presented below may be hedged by derivatives and other financial instruments that are classified as Level 1 or Level 2. Thus, the following tables do not fully reflect the impact of our risk management activities.
Nonrecurring Fair Value We may be required to measure certain assets and liabilities at fair value from time to time. These periodic fair value measures typically result from the application of lower-of-cost or fair value accounting or certain impairment measures. These items would constitute nonrecurring fair value measures. The following tables display the assets and liabilities measured at fair value on a nonrecurring basis.
n/m = not meaningful
n/m = not meaningful
Fair Value Option for Financial Assets We elected the fair value option for an insignificant amount of conforming mortgage loans held-for-sale. We elected the fair value option to mitigate earnings volatility by better matching the accounting for the assets with the related derivatives. Our intent in electing fair value measurement was to mitigate a divergence between accounting gains or losses and economic exposure for certain assets and liabilities. Fair Value of Financial Instruments The following table presents the carrying and estimated fair value of financial instruments, except for those recorded at fair value on a recurring basis presented in the previous section of this note titled Recurring Fair Value. When possible, we use quoted market prices to determine fair value. Where quoted market prices are not available, the fair value is internally derived based on appropriate valuation methodologies with respect to the amount and timing of future cash flows and estimated discount rates. However, considerable judgment is required in interpreting current market data to develop the market assumptions and inputs necessary to estimate fair value. As such, the actual amount received to sell an asset or the amount paid to settle a liability could differ from our estimates. Fair value information presented herein was based on information available at June 30, 2018, and December 31, 2017.
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Offsetting Assets and Liabilities |
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Offsetting Assets and Liabilities [Abstract] | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Offsetting Assets and Liabilities [Text Block] | Offsetting Assets and Liabilities Our derivative contracts and repurchase/reverse repurchase transactions are supported by qualifying master netting and master repurchase agreements. These agreements are legally enforceable bilateral agreements that (i) create a single legal obligation for all individual transactions covered by the agreement to the nondefaulting entity upon an event of default of the counterparty, including bankruptcy, insolvency, or similar proceeding, and (ii) provide the nondefaulting entity the right to accelerate, terminate, and close-out on a net basis all transactions under the agreement and to liquidate or set off collateral promptly upon an event of default of the counterparty. To further mitigate the risk of counterparty default related to derivative instruments, we maintain collateral agreements with certain counterparties. The agreements require both parties to maintain collateral in the event the fair values of the derivative financial instruments meet established thresholds. In the event that either party defaults on the obligation, the secured party may seize the collateral. Generally, our collateral arrangements are bilateral such that we and the counterparty post collateral for the obligation. Contractual terms provide for standard and customary exchange of collateral based on changes in the market value of the outstanding derivatives. A party posts additional collateral when their obligation rises or removes collateral when it falls, such that the net replacement cost of the nondefaulting party is covered in the event of counterparty default. In certain instances as it relates to our derivative instruments, we have the option to report derivative assets and liabilities as well as assets and liabilities associated with cash collateral received or delivered that is governed by a master netting agreement on a net basis as long as certain qualifying criteria are met. Similarly, for our repurchase/reverse repurchase transactions, we have the option to report recognized assets and liabilities subject to a master netting agreement on a net basis if certain qualifying criteria are met. At June 30, 2018, these instruments are reported as gross assets and gross liabilities on the Condensed Consolidated Balance Sheet. The composition of offsetting derivative instruments, financial assets, and financial liabilities was as follows.
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Segment Information |
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Segment Reporting [Abstract] | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Segment Reporting Disclosure [Text Block] | Segment Information Operating segments are defined as components of an enterprise that engage in business activity from which revenues are earned and expenses incurred for which discrete financial information is available that is evaluated regularly by our chief operating decision maker in deciding how to allocate resources and in assessing performance. We report our results of operations on a line-of-business basis through four operating segments: Automotive Finance operations, Insurance operations, Mortgage Finance operations, and Corporate Finance operations, with the remaining activity reported in Corporate and Other. The operating segments are determined based on the products and services offered, and reflect the manner in which financial information is currently evaluated by management. The following is a description of each of our reportable operating segments. Automotive Finance operations — One of the largest full service automotive finance operations in the United States providing automotive financing services to consumers, automotive dealers, companies, and municipalities. Our automotive finance services include providing retail installment sales contracts, loans and leases, offering term loans to dealers, financing dealer floorplans and other lines of credit to dealers, warehouse lines to companies, fleet financing, providing financing to companies and municipalities for the purchase or lease of vehicles, and vehicle remarketing services. Insurance operations — A complementary automotive-focused business offering both consumer finance protection and insurance products sold primarily through the automotive dealer channel, and commercial insurance products sold directly to dealers. As part of our focus on offering dealers a broad range of consumer financial and insurance products, we provide VSCs, VMCs, and GAP products. We also underwrite select commercial insurance coverages, which primarily insure dealers’ wholesale vehicle inventory. Mortgage Finance operations — Primarily consists of the management of a held-for-investment consumer mortgage finance loan portfolio, which includes bulk purchases of high-quality jumbo and low-to-moderate income (LMI) mortgage loans originated by third parties. In late 2016, we introduced our direct-to-consumer mortgage offering, named Ally Home, consisting of a variety of jumbo and conforming fixed- and adjustable-rate mortgage products with the assistance of a third-party fulfillment partner. Jumbo mortgage loans are generally held on our balance sheet and are accounted for as held-for-investment. Conforming mortgage loans are generally originated as held-for-sale and then sold to the fulfillment partner, and we retain no mortgage servicing rights associated with those loans that are sold. Corporate Finance operations — Primarily provides senior secured leveraged cash flow and asset-based loans to mostly U.S.-based middle-market companies. Our primary focus is on businesses owned by private equity sponsors with loans typically used for leveraged buyouts, mergers and acquisitions, debt refinancing, restructurings, and working capital. In 2017, we introduced a commercial real estate product to serve companies in the healthcare industry. Corporate and Other primarily consists of centralized corporate treasury activities such as management of the cash and corporate investment securities and loan portfolios, short- and long-term debt, retail and brokered deposit liabilities, derivative instruments, original issue discount, and the residual impacts of our corporate funds-transfer pricing (FTP) and treasury asset liability management (ALM) activities. Corporate and Other also includes certain equity investments, which primarily consist of FHLB and FRB stock, the management of our legacy mortgage portfolio, which primarily consists of loans originated prior to January 1, 2009, and reclassifications and eliminations between the reportable operating segments. Additionally, financial results related to Ally Invest are currently included within Corporate and Other. We utilize an FTP methodology for the majority of our business operations. The FTP methodology assigns charge rates and credit rates to classes of assets and liabilities based on expected duration and the benchmark rate curve plus an assumed credit spread. Matching duration allocates interest income and interest expense to these reportable segments so their respective results are insulated from interest rate risk. This methodology is consistent with our ALM practices, which includes managing interest rate risk centrally at a corporate level. The net residual impact of the FTP methodology is included within the results of Corporate and Other. The information presented in our reportable operating segments is based in part on internal allocations, which involve management judgment. Financial information for our reportable operating segments is summarized as follows.
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Parent and Guarantor Condensed Consolidating Financial Statements |
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Organization, Consolidation and Presentation of Financial Statements [Abstract] | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Condensed Financial Statements [Text Block] | 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 June 30, 2018, 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
Condensed Consolidating Balance Sheet
Condensed Consolidating Statement of Cash Flows
The following table provides a reconciliation of cash and cash equivalents and restricted cash from the Condensed Consolidated Balance Sheet to the Condensed Consolidated Statement of Cash Flows.
The following table provides a reconciliation of cash and cash equivalents and restricted cash from the Condensed Consolidated Balance Sheet to the Condensed Consolidated Statement of Cash Flows.
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Contingencies and Other Risks |
6 Months Ended |
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Jun. 30, 2018 | |
Loss Contingency [Abstract] | |
Contingencies Disclosure [Text Block] | Contingencies and Other Risks Legal Matters Ally and its subsidiaries, including Ally Bank, are or may be subject to potential liability in connection with pending or threatened legal proceedings and other matters. These legal matters may be formal or informal and include litigation and arbitration with one or more identified claimants, certified or purported class actions with yet-to-be-identified claimants, and regulatory or other governmental information-gathering requests, examinations, investigations, and enforcement proceedings. Our legal matters exist in varying stages of adjudication, arbitration, negotiation, or investigation and span our business lines and operations. Claims may be based in law or equity—such as those arising under contracts or in tort and those involving banking, consumer-protection, securities, tax, employment, and other laws—and some can present novel legal theories and allege substantial or indeterminate damages. We accrue for a legal matter when a loss becomes probable and the amount of loss can be reasonably estimated. Accruals are evaluated each quarter and may be adjusted, upward or downward, based on our best judgment after consultation with counsel. No assurance exists that our accruals will not need to be adjusted in the future. When a probable or reasonably possible loss on a legal matter could be material to our consolidated financial condition, results of operations, or cash flows, we provide disclosure in this note as prescribed by ASC 450, Contingencies. The course and outcome of legal matters are inherently unpredictable. This is especially so when a matter is still in its early stages, the damages sought are indeterminate or unsupported, significant facts are unclear or disputed, novel questions of law or other meaningful legal uncertainties exist, a request to certify a proceeding as a class action is outstanding or granted, multiple parties are named, or regulatory or other governmental entities are involved. As a result, we often are unable to determine how or when threatened or pending legal matters will be resolved and what losses may be incurred. Actual losses may be higher or lower than any amounts accrued or estimated for those matters, possibly to a significant degree. Descriptions of our material legal matters follow. We do not believe, however, that an estimate of reasonably possible losses or a range of reasonably possible losses—whether in excess of any related accrual or where no accrual exists—can be made for any of these matters for some or all of the reasons identified in the preceding paragraph. Securities Litigation In October 2016, a purported class action—Bucks County Employees Retirement Fund v. Ally Financial Inc. et al.—was filed in the Circuit Court for Wayne County in the State of Michigan (Case No. 16-013616-CZ). This matter was removed to the U.S. District Court for the Eastern District of Michigan on November 18, 2016. The complaint alleges material misstatements and omissions in connection with Ally’s initial public offering in April 2014, including a failure to adequately disclose the severity of rising subprime automotive loan delinquency rates, deficient underwriting measures employed in the origination of subprime automotive loans, and aggressive tactics used with low-income borrowers. The request for relief includes an indeterminate amount of damages, fees, and costs and other remedies. In January 2017, another purported class action—National Shopmen Pension Fund v. Ally Financial Inc. et al.—was filed in the Circuit Court for Oakland County in the State of Michigan (Case No. 2017-156719-CB). This matter was removed to the U.S. District Court for the Eastern District of Michigan on January 30, 2017. In March 2017, a third purported class action—James McIntire v. Ally Financial Inc. et al.—was filed in the Circuit Court for Wayne County in the State of Michigan (Case No. 17-003811-CZ). This matter was removed to the U.S. District Court for the Eastern District of Michigan on March 15, 2017. The allegations and requested relief in the National Shopmen Pension Fund and James McIntire complaints are substantially similar to those included in the complaint filed by Bucks County Employees Retirement Fund. All three matters were remanded from the U.S. District Court for the Eastern District of Michigan to the state circuit courts on May 26, 2017, and have been consolidated for discovery in Wayne County Circuit Court as In re Ally Financial, Inc. Securities Litigation (Case No. 16-013616-CB). In November 2017, the plaintiffs filed a consolidated amended complaint. In April 2018, the court entered a scheduling order setting deadlines for briefing of defendants’ joint motion for summary disposition. We intend to vigorously defend against each of these actions. Automotive Subprime Matters In October 2014, we received a document request from the SEC in connection with its investigation related to subprime automotive finance and related securitization activities. Separately, in December 2014, we received a subpoena from the U.S. Department of Justice requesting similar information. In May 2015 and December 2016, we received information requests from the New York Department of Financial Services requesting similar information. We responded timely to each of the requests. Other Contingencies Ally and its subsidiaries, including Ally Bank, are or may be subject to potential liability under various other contingent exposures, including indemnification, tax, self-insurance, and other miscellaneous contingencies. We accrue for a contingent exposure when a loss becomes probable and the amount of loss can be reasonably estimated. Accruals are evaluated each quarter and may be adjusted, upward or downward, based on our best judgment. No assurance exists that our accruals will not need to be adjusted in the future, and actual losses may be higher or lower than any amounts accrued or estimated for those exposures, possibly to a significant degree. On the basis of information currently available, we do not believe that these other contingent exposures will be material to our consolidated financial condition, results of operations, or cash flows. Refer to Note 1 to the Consolidated Financial Statements in our 2017 Annual Report on Form 10-K for additional information related to our policy for establishing reserves for legal and regulatory matters. |
Subsequent Events |
6 Months Ended |
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Jun. 30, 2018 | |
Subsequent Events [Abstract] | |
Subsequent Events [Text Block] | Subsequent Events Declaration of Quarterly Dividend On July 13, 2018, the Board declared a quarterly cash dividend of $0.15 per share on all common stock. The dividend is payable on August 15, 2018, to stockholders of record at the close of business on August 1, 2018. |
Description of Business, Basis of Presentation, and Changes in Significant Accounting Policies (Policies) |
6 Months Ended |
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Jun. 30, 2018 | |
Organization, Consolidation and Presentation of Financial Statements [Abstract] | |
Basis of Accounting, Policy [Policy Text Block] | Our accounting and reporting policies conform to accounting principles generally accepted in the United States of America (GAAP). Additionally, where applicable, the policies conform to the accounting and reporting guidelines prescribed by bank regulatory authorities. The preparation of financial statements in conformity with GAAP requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities and disclosure of contingent assets and liabilities at the date of the financial statements and that affect income and expenses during the reporting period and related disclosures. In developing the estimates and assumptions, management uses all available evidence; however, actual results could differ because of uncertainties associated with estimating the amounts, timing, and likelihood of possible outcomes. |
Investment, Policy [Policy Text Block] | Our investment portfolio includes various debt and equity securities. Our debt securities include government securities, corporate bonds, asset-backed securities (ABS), and mortgage-backed securities (MBS). Debt securities are classified based on management’s intent to sell or hold the security. We classify debt securities as held-to-maturity only when we have both the intent and ability to hold the securities to maturity. We classify debt securities as trading when the securities are acquired for the purpose of selling or holding them for a short period of time. Debt securities not classified as either held-to-maturity or trading are classified as available-for-sale. Our portfolio includes debt securities classified as available-for-sale and held-to-maturity. Our available-for-sale debt securities are carried at fair value with unrealized gains and losses included in accumulated other comprehensive loss and are subject to impairment. Our held-to-maturity debt securities are carried at amortized cost and are subject to impairment. We assess our available-for-sale and held-to-maturity debt securities for potential other-than-temporary impairment. We employ a methodology that considers available evidence in evaluating potential other-than-temporary impairment of our debt securities. If the cost of an investment exceeds its fair value, we evaluate, among other factors, the magnitude and duration of the decline in fair value. We also evaluate the financial health of and business outlook for the issuer, the performance of the underlying assets for interests in securitized assets, and, for debt securities classified as available-for-sale, our intent and ability to hold the investment through recovery of its amortized cost basis. Once a decline in fair value of a debt security is determined to be other-than-temporary, an impairment charge for the credit component is recorded to other gain (loss) on investments, net, in our Condensed Consolidated Statement of Comprehensive Income, and a new cost basis in the investment is established. The noncredit loss component of an available-for-sale debt security continues to be recorded in other comprehensive (loss) income when we do not intend to sell the security and it is not more likely than not that we will have to sell the security prior to the security’s anticipated recovery. Both the credit and noncredit loss components are recorded in earnings when we intend to sell the security or it is more likely than not that we will have to sell the security prior to the security’s anticipated recovery. Subsequent increases and decreases to the fair value of available-for-sale debt securities are included in other comprehensive (loss) income, so long as they are not attributable to another other-than-temporary impairment. We amortize premiums and discounts on debt securities as an adjustment to investment yield generally over the stated maturity of the security. For ABS and MBS where prepayments can be reasonably estimated, amortization is adjusted for expected prepayments. Our investment in equity securities includes securities that are recognized at fair value with changes in the fair value recorded in earnings, and equity securities that are recognized using other measurement principles. Effective January 1, 2018, equity securities that have a readily determinable fair value, as well as certain investments that do not have a readily determinable fair value and are not eligible to be recognized using other measurement principles, are recorded at fair value with changes in fair value recorded in earnings and reported in other gain (loss) on investments, net in our Condensed Consolidated Statement of Comprehensive Income. These investments, which are primarily attributable to the investment portfolio of our Insurance operations, are included in equity securities on our Condensed Consolidated Balance Sheet. Refer to Note 6 for further information on our equity securities that have a readily determinable market value. Our equity securities recognized using other measurement principles include investments in Federal Home Loan Bank (FHLB) and Federal Reserve Bank (FRB) stock held to meet regulatory requirements, equity investments related to low income housing tax credits and the Community Reinvestment Act (CRA), which do not have a readily determinable fair value, and other equity investments that do not have a readily determinable fair value. Our low income housing tax credit investments are accounted for using the proportional amortization method of accounting for qualified affordable housing investments. Our obligations related to unfunded commitments for our low income housing tax credit investments are included in other liabilities. The majority of our CRA investments are accounted for using the equity method of accounting. Our investments in low income housing tax credits and CRA investments are included in other assets on our Condensed Consolidated Balance Sheet. Our investments in FHLB and FRB stock are carried at cost. Our remaining investments in equity securities are recorded at cost, less impairment and adjusted for observable price changes under the measurement alternative provided under GAAP. These investments, along with our investments in FHLB and FRB stock, are included in nonmarketable equity investments in other assets on our Condensed Consolidated Balance Sheet. As conditions warrant, we review these investments for impairment and adjust the carrying value of the investment if it is deemed to be impaired. Investments recorded under the measurement alternative are also reviewed at each reporting period to determine if any adjustments are required for observable price changes in identical or similar securities of the same issuer. Realized gains and losses on the sale of securities are determined using the specific identification method and are reported in other gain (loss) on investments, net in our Condensed Consolidated Statement of Comprehensive Income. |
Derivatives, Policy [Policy Text Block] | We use derivative instruments primarily for risk management purposes. We do not use derivative instruments for speculative purposes. Certain of our derivative instruments are designated as accounting hedges in qualifying relationships, whereas other derivative instruments have not been designated as accounting hedges. In accordance with applicable accounting standards, all derivative instruments, whether designated for hedge accounting or not, are required to be recorded on the balance sheet as assets or liabilities and measured at fair value. We have elected to report the fair value of derivative assets and liabilities on a gross basis—including the fair value for the right to reclaim cash collateral or the obligation to return cash collateral—arising from instruments executed with the same counterparty under a master netting arrangement where we do not have the intent to offset. For additional information on derivative instruments and hedging activities, refer to Note 18. At the inception of a hedge accounting relationship, we designate each qualifying hedge relationship as a hedge of the fair value of a specifically identified asset or liability (fair value hedge); as a hedge of the variability of cash flows to be received or paid, or forecasted to be received or paid, related to a recognized asset or liability (cash flow hedge); or as a hedge of the foreign-currency exposure of a net investment in a foreign operation (net investment hedge). We formally document all relationships between hedging instruments and hedged items, as well as the risk management objectives for undertaking various hedge transactions. Both at hedge inception and on an ongoing basis, we formally assess whether the derivatives that are used in hedging relationships are highly effective in offsetting changes in the fair values or cash flows of hedged items. Changes in the fair value of derivative instruments qualifying as fair value hedges, along with the gain or loss on the hedged asset or liability attributable to the hedged risk, are recorded in current period earnings. For qualifying cash flow hedges, the changes in fair value of the derivative financial instruments are recorded in accumulated other comprehensive loss and recognized in the income statement when the hedged cash flows affect earnings. For a qualifying net investment hedge, the gain or loss is reported in accumulated other comprehensive loss as part of the cumulative translation adjustment. Hedge accounting treatment is no longer applied if a derivative financial instrument is terminated, or if the hedge designation is removed or assessed to be no longer highly effective. For terminated fair value hedges, any changes to the hedged asset or liability remain as part of the basis of the hedged asset or liability and are recognized into income over the remaining life of the asset or liability. For terminated cash flow hedges, unless it is probable that the forecasted cash flows will not occur within a specified period, any changes in fair value of the derivative financial instrument previously recognized remain in accumulated other comprehensive loss, and are reclassified into earnings in the same period that the hedged cash flows affect earnings. Any previously recognized gain or loss for a net investment hedge continues to remain in accumulated other comprehensive loss until earnings are impacted by sale or liquidation of the associated foreign operation. In all instances, after hedge accounting is no longer applied, any subsequent changes in fair value of the derivative instrument will be recorded into earnings. Changes in the fair value of derivative financial instruments held for risk management purposes that are not designated as accounting hedges under GAAP are reported in current period earnings. |
Income Tax, Policy [Policy Text Block] | In calculating the provision for interim income taxes, in accordance with Accounting Standards Codification (ASC) 740, Income Taxes, we apply an estimated annual effective tax rate to year-to-date ordinary income. At the end of each interim period, we estimate the effective tax rate expected to be applicable for the full fiscal year. This method differs from that described in Note 1 to the Consolidated Financial Statements in our 2017 Annual Report on Form 10-K, which describes our annual significant income tax accounting policy and related methodology. |
New Accounting Pronouncements or Change in Accounting Principle [Line Items] | |
New Accounting Pronouncements, Policy [Policy Text Block] | Recently Adopted Accounting Standards Statement of Cash Flows — Restricted Cash (ASU 2016-18) As of December 31, 2017, we elected to early-adopt Accounting Standards Update (ASU) 2016-18. The amendments in this update require that amounts classified as restricted cash and restricted cash equivalents be included within the beginning-of-period and end-of-period amounts along with cash and cash equivalents on the statement of cash flows. The amendments were applied retrospectively to all periods presented within the statement of cash flows. The implementation of this guidance resulted in a change in presentation of our Condensed Consolidated Statement of Cash Flows and additional disclosures surrounding restricted cash balances, but did not result in a change to our Condensed Consolidated Statement of Comprehensive Income or Condensed Consolidated Balance Sheet. Revenue from Contracts with Customers (ASU 2014-09) In May 2014, the Financial Accounting Standards Board (FASB) issued ASU 2014-09. The purpose of this guidance is to streamline and consolidate existing revenue recognition principles in GAAP and to converge revenue recognition principles with International Financial Reporting Standards. The core principle of the amendments is that an entity should recognize revenue to depict the transfer of promised goods or services to customers in an amount that reflects the consideration to which the entity expects to be entitled to receive in exchange for those goods or services. The amendments include a five step process for consideration of the core principle, guidance on the accounting treatment for costs associated with a contract, and disclosure requirements related to the revenue process. The FASB issued several additional ASUs to clarify guidance and provide implementation support for ASU 2014-09. The clarifying guidance elaborates on the key concepts within ASU 2014-09 and clarifies how those concepts interact with other GAAP requirements. On January 1, 2018, we adopted ASU 2014-09 and all subsequent ASUs that modified ASU 2014-09 (collectively, the amendments to the revenue recognition principles), which have been codified in ASC 606, Revenue from Contracts with Customers, and ASC 610-20, Gains and Losses from the Derecognition of Nonfinancial Assets, respectively. We elected to adopt this guidance using the modified retrospective approach applied to all contracts with customers that were not completed as of January 1, 2018. The adoption of the amendments resulted in a reduction to our opening retained earnings of approximately $126 million, net of income taxes. Refer to Note 2 for further details. Financial Instruments — Recognition and Measurement of Financial Assets (ASU 2016-01) As of January 1, 2018, we adopted ASU 2016-01. The amendments in this update modify the requirements related to the measurement of certain financial instruments in the statement of financial condition and results of operations. The FASB subsequently issued ASU 2018-03 to clarify guidance and provide implementation support for ASU 2016-01, which we elected to early-adopt as of January 1, 2018, to align with the adoption of ASU 2016-01. For equity investments (other than investments accounted for using the equity method), entities must measure such instruments at fair value with changes in fair value recognized in net income. Changes in fair value for equity securities are no longer recognized through other comprehensive (loss) income, which creates additional volatility in our Condensed Consolidated Statement of Comprehensive Income. Reporting entities may continue to elect to measure certain equity investments that do not have a readily determinable fair value at cost with adjustments for impairment and observable changes in price. In addition, for a liability (other than a derivative liability) that an entity measures at fair value, any change in fair value related to the instrument-specific credit risk, that is the entity’s own-credit, should be presented separately in other comprehensive (loss) income and not as a component of net income. We adopted these amendments, as required, on a modified retrospective basis with a cumulative effect adjustment as of the beginning of the fiscal year of initial adoption. The adoption of the amendments resulted in a reduction to our opening retained earnings of approximately $20 million, net of income taxes. Derivatives and Hedging — Targeted Improvements to Accounting for Hedging Activities (ASU 2017-12) As of January 1, 2018, we elected to early-adopt ASU 2017-12. The amendments in this update enhance the financial reporting of hedging relationships to better align hedge accounting with an entity’s risk management activities. This update also makes certain targeted improvements to simplify the application of the hedge accounting guidance in current GAAP and better portrays economic results through changes to both the designation and measurement guidance for qualifying hedging relationships and presentation of hedge results. We adopted the amendments to all cash flow and net investment hedge relationships that existed on the date of adoption using a modified retrospective approach. No cumulative effect adjustment to our opening retained earnings was required as a result of the adoption. The presentation and disclosure requirements included in this update were adopted prospectively. Refer to Note 18 for further details. Accumulated Other Comprehensive Income — Reclassification of Certain Tax Effects (ASU 2018-02) In February 2018, the FASB issued ASU 2018-02. The amendments in this update provide guidance concerning the treatment of the impact of income tax effects resulting from the Tax Cuts and Jobs Act of 2017 (the Tax Act) on items included in accumulated other comprehensive income. Our policy is to use the portfolio method with respect to reclassification of stranded income tax effects in accumulated other comprehensive loss. The amendments in ASU 2018-02 provide entities an election to reclassify the income tax effect of the Tax Act from accumulated other comprehensive income to retained earnings. We elected to early-adopt this standard as of January 1, 2018, and reclassified the effect of the change in the federal corporate income tax rate on items included in accumulated other comprehensive loss. This election resulted in a reclassification of $42 million from accumulated other comprehensive loss to retained earnings. Recently Issued Accounting Standards Leases (ASU 2016-02) In February 2016, the FASB issued ASU 2016-02. The amendments in this update primarily replace the existing accounting requirements for operating leases for lessees. Lessee accounting requirements for finance leases and lessor accounting requirements for operating leases and sales type and direct financing leases (sales-type and direct financing leases were both previously referred to as capital leases) are largely unchanged. The amendments require the lessee of an operating lease to record a balance sheet gross-up upon lease commencement by recognizing a right-of-use asset and lease liability equal to the present value of the lease payments. The right-of-use asset and lease liability should be derecognized in a manner that effectively yields a straight line lease expense over the lease term. In addition to the changes to the lessee operating lease accounting requirements, the amendments also change the types of costs that can be capitalized related to a lease agreement for both lessees and lessors for all types of leases. The amendments also require additional disclosures for all lease types for both lessees and lessors. The amendments are effective on January 1, 2019, with early adoption permitted. The amendments must be applied on a modified retrospective basis with a cumulative adjustment to the beginning of the earliest fiscal year presented in the financial statements in the period of adoption. We are currently in the process of reviewing our lease contracts and examining the practical expedients and accounting policy elections provided in the amendments, as well as ensuring our control environment and reporting processes reflect the requirements of the amendments. Upon adoption, our balance sheet will include a right-of-use asset and lease liability for our operating leases where we are the lessee, which primarily include our facilities leases. In addition, we will no longer capitalize certain initial direct costs in connection with lease originations where we are the lessor. We do not anticipate the adoption of these amendments will have a material impact to our financial statements. We currently plan to adopt these amendments on January 1, 2019, and expect to use the modified retrospective approach as currently required. Financial Instruments — Credit Losses (ASU 2016-13) In June 2016, the FASB issued ASU 2016-13. The amendments in this update introduce a new accounting model to measure credit losses for financial assets measured at amortized cost. Credit losses for financial assets measured at amortized cost should be determined based on the total current expected credit losses over the life of the financial asset or group of financial assets. In effect, the financial asset or group of financial assets should be presented at the net amount expected to be collected. Credit losses will no longer be recorded under the current incurred loss model for financial assets measured at amortized cost. The amendments also modify the accounting for available-for-sale debt securities whereby credit losses will be recorded through an allowance for credit losses rather than a write-down to the security’s cost basis, which allows for reversals of credit losses when estimated credit losses decline. Credit losses for available-for-sale debt securities should be measured in a manner similar to current GAAP. The amendments are effective on January 1, 2020, with early adoption permitted as of January 1, 2019. The amendments must be applied using a modified retrospective approach with a cumulative-effect adjustment through retained earnings as of the beginning of the fiscal year upon adoption. The new accounting model for credit losses represents a significant departure from existing GAAP, and will likely materially increase the allowance for credit losses with a resulting negative adjustment to retained earnings. The amount of the change in the allowance for credit losses will also be impacted by the composition of our portfolio at the adoption date, as well as economic conditions and forecasts at that time. Management created a cross-functional working group to govern the implementation of these amendments, including consideration of model development, data integrity, technology, reporting and disclosure requirements, key accounting interpretations, control environment, and corporate governance. We are in the process of designing and building the models and procedures that will be used to calculate the credit loss reserves in accordance with these amendments. We currently plan to adopt these amendments on January 1, 2020, and expect to use the modified retrospective approach as required. Receivables — Nonrefundable Fees and Other Costs: Premium Amortization on Purchased Callable Debt Securities (ASU 2017-08) In March 2017, the FASB issued ASU 2017-08. The amendments in this update require premiums on purchased callable debt securities to be amortized to the security’s earliest call date. Prior to this ASU, premiums and discounts on purchased callable debt securities were generally required to be amortized to the security’s maturity date. The amendments do not require an accounting change for securities held at a discount. The amendments are effective on January 1, 2019, with early adoption permitted. The amendments must be applied using a modified retrospective approach with a cumulative-effect adjustment through retained earnings as of the beginning of the fiscal year upon adoption. While our assessment is not final, we do not expect the amendments to have a material impact to our financial statements and are currently in the process of ensuring our control environment and reporting processes reflect the requirements of the amendments. We currently plan to adopt these amendments on January 1, 2019, and expect to use the modified retrospective approach as required. |
Accounting Standards Update 2016-18 [Member] | |
New Accounting Pronouncements or Change in Accounting Principle [Line Items] | |
New Accounting Pronouncements, Policy [Policy Text Block] | As of December 31, 2017, we elected to early-adopt Accounting Standards Update (ASU) 2016-18. The amendments in this update require that amounts classified as restricted cash and restricted cash equivalents be included within the beginning-of-period and end-of-period amounts along with cash and cash equivalents on the statement of cash flows. The amendments were applied retrospectively to all periods presented within the statement of cash flows. The implementation of this guidance resulted in a change in presentation of our Condensed Consolidated Statement of Cash Flows and additional disclosures surrounding restricted cash balances, but did not result in a change to our Condensed Consolidated Statement of Comprehensive Income or Condensed Consolidated Balance Sheet. |
Accounting Standards Update 2014-09 [Member] | |
New Accounting Pronouncements or Change in Accounting Principle [Line Items] | |
New Accounting Pronouncements, Policy [Policy Text Block] | In May 2014, the Financial Accounting Standards Board (FASB) issued ASU 2014-09. The purpose of this guidance is to streamline and consolidate existing revenue recognition principles in GAAP and to converge revenue recognition principles with International Financial Reporting Standards. The core principle of the amendments is that an entity should recognize revenue to depict the transfer of promised goods or services to customers in an amount that reflects the consideration to which the entity expects to be entitled to receive in exchange for those goods or services. The amendments include a five step process for consideration of the core principle, guidance on the accounting treatment for costs associated with a contract, and disclosure requirements related to the revenue process. The FASB issued several additional ASUs to clarify guidance and provide implementation support for ASU 2014-09. The clarifying guidance elaborates on the key concepts within ASU 2014-09 and clarifies how those concepts interact with other GAAP requirements. On January 1, 2018, we adopted ASU 2014-09 and all subsequent ASUs that modified ASU 2014-09 (collectively, the amendments to the revenue recognition principles), which have been codified in ASC 606, Revenue from Contracts with Customers, and ASC 610-20, Gains and Losses from the Derecognition of Nonfinancial Assets, respectively. We elected to adopt this guidance using the modified retrospective approach applied to all contracts with customers that were not completed as of January 1, 2018. The adoption of the amendments resulted in a reduction to our opening retained earnings of approximately $126 million, net of income taxes. Refer to Note 2 for further details. |
Accounting Standards Update 2016-01 [Member] | |
New Accounting Pronouncements or Change in Accounting Principle [Line Items] | |
New Accounting Pronouncements, Policy [Policy Text Block] | As of January 1, 2018, we adopted ASU 2016-01. The amendments in this update modify the requirements related to the measurement of certain financial instruments in the statement of financial condition and results of operations. The FASB subsequently issued ASU 2018-03 to clarify guidance and provide implementation support for ASU 2016-01, which we elected to early-adopt as of January 1, 2018, to align with the adoption of ASU 2016-01. For equity investments (other than investments accounted for using the equity method), entities must measure such instruments at fair value with changes in fair value recognized in net income. Changes in fair value for equity securities are no longer recognized through other comprehensive (loss) income, which creates additional volatility in our Condensed Consolidated Statement of Comprehensive Income. Reporting entities may continue to elect to measure certain equity investments that do not have a readily determinable fair value at cost with adjustments for impairment and observable changes in price. In addition, for a liability (other than a derivative liability) that an entity measures at fair value, any change in fair value related to the instrument-specific credit risk, that is the entity’s own-credit, should be presented separately in other comprehensive (loss) income and not as a component of net income. We adopted these amendments, as required, on a modified retrospective basis with a cumulative effect adjustment as of the beginning of the fiscal year of initial adoption. The adoption of the amendments resulted in a reduction to our opening retained earnings of approximately $20 million, net of income taxes |
Accounting Standards Update 2017-12 [Member] | |
New Accounting Pronouncements or Change in Accounting Principle [Line Items] | |
New Accounting Pronouncements, Policy [Policy Text Block] | As of January 1, 2018, we elected to early-adopt ASU 2017-12. The amendments in this update enhance the financial reporting of hedging relationships to better align hedge accounting with an entity’s risk management activities. This update also makes certain targeted improvements to simplify the application of the hedge accounting guidance in current GAAP and better portrays economic results through changes to both the designation and measurement guidance for qualifying hedging relationships and presentation of hedge results. We adopted the amendments to all cash flow and net investment hedge relationships that existed on the date of adoption using a modified retrospective approach. No cumulative effect adjustment to our opening retained earnings was required as a result of the adoption. The presentation and disclosure requirements included in this update were adopted prospectively. Refer to Note 18 for further details. |
Accounting Standards Update 2018-02 [Member] | |
New Accounting Pronouncements or Change in Accounting Principle [Line Items] | |
New Accounting Pronouncements, Policy [Policy Text Block] | In February 2018, the FASB issued ASU 2018-02. The amendments in this update provide guidance concerning the treatment of the impact of income tax effects resulting from the Tax Cuts and Jobs Act of 2017 (the Tax Act) on items included in accumulated other comprehensive income. Our policy is to use the portfolio method with respect to reclassification of stranded income tax effects in accumulated other comprehensive loss. The amendments in ASU 2018-02 provide entities an election to reclassify the income tax effect of the Tax Act from accumulated other comprehensive income to retained earnings. We elected to early-adopt this standard as of January 1, 2018, and reclassified the effect of the change in the federal corporate income tax rate on items included in accumulated other comprehensive loss. This election resulted in a reclassification of $42 million from accumulated other comprehensive loss to retained earnings. |
Accounting Standards Update 2016-02 [Member] | |
New Accounting Pronouncements or Change in Accounting Principle [Line Items] | |
New Accounting Pronouncements, Policy [Policy Text Block] | In February 2016, the FASB issued ASU 2016-02. The amendments in this update primarily replace the existing accounting requirements for operating leases for lessees. Lessee accounting requirements for finance leases and lessor accounting requirements for operating leases and sales type and direct financing leases (sales-type and direct financing leases were both previously referred to as capital leases) are largely unchanged. The amendments require the lessee of an operating lease to record a balance sheet gross-up upon lease commencement by recognizing a right-of-use asset and lease liability equal to the present value of the lease payments. The right-of-use asset and lease liability should be derecognized in a manner that effectively yields a straight line lease expense over the lease term. In addition to the changes to the lessee operating lease accounting requirements, the amendments also change the types of costs that can be capitalized related to a lease agreement for both lessees and lessors for all types of leases. The amendments also require additional disclosures for all lease types for both lessees and lessors. The amendments are effective on January 1, 2019, with early adoption permitted. The amendments must be applied on a modified retrospective basis with a cumulative adjustment to the beginning of the earliest fiscal year presented in the financial statements in the period of adoption. We are currently in the process of reviewing our lease contracts and examining the practical expedients and accounting policy elections provided in the amendments, as well as ensuring our control environment and reporting processes reflect the requirements of the amendments. Upon adoption, our balance sheet will include a right-of-use asset and lease liability for our operating leases where we are the lessee, which primarily include our facilities leases. In addition, we will no longer capitalize certain initial direct costs in connection with lease originations where we are the lessor. We do not anticipate the adoption of these amendments will have a material impact to our financial statements. We currently plan to adopt these amendments on January 1, 2019, and expect to use the modified retrospective approach as currently required. |
Accounting Standards Update 2016-13 [Member] | |
New Accounting Pronouncements or Change in Accounting Principle [Line Items] | |
New Accounting Pronouncements, Policy [Policy Text Block] | In June 2016, the FASB issued ASU 2016-13. The amendments in this update introduce a new accounting model to measure credit losses for financial assets measured at amortized cost. Credit losses for financial assets measured at amortized cost should be determined based on the total current expected credit losses over the life of the financial asset or group of financial assets. In effect, the financial asset or group of financial assets should be presented at the net amount expected to be collected. Credit losses will no longer be recorded under the current incurred loss model for financial assets measured at amortized cost. The amendments also modify the accounting for available-for-sale debt securities whereby credit losses will be recorded through an allowance for credit losses rather than a write-down to the security’s cost basis, which allows for reversals of credit losses when estimated credit losses decline. Credit losses for available-for-sale debt securities should be measured in a manner similar to current GAAP. The amendments are effective on January 1, 2020, with early adoption permitted as of January 1, 2019. The amendments must be applied using a modified retrospective approach with a cumulative-effect adjustment through retained earnings as of the beginning of the fiscal year upon adoption. The new accounting model for credit losses represents a significant departure from existing GAAP, and will likely materially increase the allowance for credit losses with a resulting negative adjustment to retained earnings. The amount of the change in the allowance for credit losses will also be impacted by the composition of our portfolio at the adoption date, as well as economic conditions and forecasts at that time. Management created a cross-functional working group to govern the implementation of these amendments, including consideration of model development, data integrity, technology, reporting and disclosure requirements, key accounting interpretations, control environment, and corporate governance. We are in the process of designing and building the models and procedures that will be used to calculate the credit loss reserves in accordance with these amendments. We currently plan to adopt these amendments on January 1, 2020, and expect to use the modified retrospective approach as required. |
Accounting Standards Update 2017-08 [Member] | |
New Accounting Pronouncements or Change in Accounting Principle [Line Items] | |
New Accounting Pronouncements, Policy [Policy Text Block] | In March 2017, the FASB issued ASU 2017-08. The amendments in this update require premiums on purchased callable debt securities to be amortized to the security’s earliest call date. Prior to this ASU, premiums and discounts on purchased callable debt securities were generally required to be amortized to the security’s maturity date. The amendments do not require an accounting change for securities held at a discount. The amendments are effective on January 1, 2019, with early adoption permitted. The amendments must be applied using a modified retrospective approach with a cumulative-effect adjustment through retained earnings as of the beginning of the fiscal year upon adoption. While our assessment is not final, we do not expect the amendments to have a material impact to our financial statements and are currently in the process of ensuring our control environment and reporting processes reflect the requirements of the amendments. We currently plan to adopt these amendments on January 1, 2019, and expect to use the modified retrospective approach as required. |
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Fair Value Measurement, Policy [Policy Text Block] | GAAP specifies a three-level hierarchy that is used when measuring and disclosing fair value. The fair value hierarchy gives the highest priority to quoted prices available in active markets (i.e., observable inputs) and the lowest priority to data lacking transparency (i.e., unobservable inputs). An instrument’s categorization within the fair value hierarchy is based on the lowest level of significant input to its valuation. The following is a description of the three hierarchy levels.
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Revenue from Contracts with Customers (Tables) |
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Schedule of New Accounting Pronouncements and Changes in Accounting Principles | The following table presents the impact to our Condensed Consolidated Balance Sheet as of January 1, 2018, as a result of adopting the amendments to the revenue recognition principles.
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Impact of ASU 2014-09 on Balance Sheet and Income Statement [Table Text Block] | The following tables present the impact of adopting the amendments to the revenue recognition principles to our Condensed Consolidated Statement of Comprehensive Income and Condensed Consolidated Balance Sheet.
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Disaggregation of Revenue [Table Text Block] | The following table presents a disaggregated view of our revenue from contracts with customers included in other revenue that falls within the scope of the amendments to the revenue recognition principles.
In addition to the components of other revenue presented above, as part of our Automotive Finance operations, we recognized gains of $16 million and $34 million for the three months and six months ended June 30, 2018, respectively, on the sale of off-lease vehicles. These gains are included in depreciation expense on operating lease assets in our Condensed Consolidated Statement of Comprehensive Income. |
Other Income, Net of Losses (Tables) |
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Jun. 30, 2018 | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Other Nonoperating Income (Expense) [Abstract] | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Schedule of Other Nonoperating Income, by Component [Table Text Block] | Details of other income, net of losses, were as follows.
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Reserves for Insurance Losses and Loss Adjustment Expenses (Tables) |
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Reserves for Insurance Losses and Loss Adjustment Expense [Abstract] | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Short-Duration Insurance and Deposit Contracts [Text Block] | The following table shows a rollforward of our reserves for insurance losses and loss adjustment expenses.
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Other Operating Expenses (Tables) |
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Operating Expenses [Abstract] | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Schedule of Other Operating Cost and Expense, by Component [Table Text Block] | Details of other operating expenses were as follows.
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Investment Securities (Tables) |
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Investments, Debt and Equity Securities [Abstract] | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Marketable Securities [Table Text Block] | Our portfolio of available-for-sale and held-to-maturity debt securities includes bonds, asset-backed securities, commercial and residential mortgage-backed securities, and other investments. We also hold equity securities. The cost, fair value, and gross unrealized gains and losses on available-for-sale and held-to-maturity investment securities were as follows.
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Investments Classified by Contractual Maturity Date [Table Text Block] | The maturity distribution of debt securities outstanding is summarized in the following tables. Call or prepayment options may cause actual maturities to differ from contractual maturities.
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Investment Income [Table Text Block] | The following table presents interest and dividends on investment securities.
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Schedule of Realized Gain (Loss) [Table Text Block] | The following table presents gross gains and losses realized upon the sales of available-for-sale securities, and net gains or losses on equity securities held during the period. There were no other-than-temporary impairments of available-for-sale securities for either period.
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Schedule of Unrealized Loss on Investments [Table Text Block] | The table below summarizes available-for-sale and held-to-maturity securities in an unrealized loss position, which we evaluated for other than temporary impairment applying the methodology described in Note 1. As of June 30, 2018, we did not have the intent to sell the available-for-sale or held-to-maturity securities with an unrealized loss position and we do not believe it is more likely than not that we will be required to sell these securities before recovery of their amortized cost basis. As a result of this evaluation, we believe that the securities with an unrealized loss position are not considered to be other-than-temporarily impaired at June 30, 2018.
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Finance Receivables and Loans, Net (Tables) |
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Loans and Leases Receivable, Net Amount [Abstract] | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Schedule of Accounts, Notes, Loans and Financing Receivable [Table Text Block] | The composition of finance receivables and loans reported at gross carrying value was as follows.
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Allowance for Credit Losses on Financing Receivables [Table Text Block] | The following tables present an analysis of the activity in the allowance for loan losses on finance receivables and loans.
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Schedule Of Sales Of Financing Receivables And Loans [Table Text Block] | The following table presents information about significant sales of finance receivables and loans and transfers of finance receivables and loans from held-for-investment to held-for-sale based on net carrying value.
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Schedule of Purchases of Financing Receivables and Loans [Table Text Block] | The following table presents information about significant purchases of finance receivables and loans based on unpaid principal balance at the time of purchase.
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Past Due Financing Receivables [Table Text Block] | The following table presents an analysis of our past due finance receivables and loans recorded at gross carrying value.
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Schedule of Financing Receivables, Non Accrual Status [Table Text Block] | The following table presents the gross carrying value of our finance receivables and loans on nonaccrual status.
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Financing Receivable Credit Quality Indicators [Table Text Block] | The following table presents performing and nonperforming credit quality indicators in accordance with our internal accounting policies for our consumer finance receivables and loans recorded at gross carrying value. Nonperforming loans include finance receivables and loans on nonaccrual status when the principal or interest has been delinquent for 90 days or when full collection is not expected. Refer to Note 1 to the Consolidated Financial Statements in our 2017 Annual Report on Form 10-K for additional information.
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Schedule Of Pass And Criticized Credit Quality Indicators Of Finance Receivables [Table Text Block] | The following table presents pass and criticized credit quality indicators based on regulatory definitions for our commercial finance receivables and loans recorded at gross carrying value.
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Impaired Financing Receivables [Table Text Block] | The following table presents information about our impaired finance receivables and loans.
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Schedule of Average Balance And Interest Income Of Impaired Finance Receivables [Table Text Block] | The following tables present average balance and interest income for our impaired finance receivables and loans.
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Troubled Debt Restructurings on Financing Receivables [Table Text Block] | The following tables present information related to finance receivables and loans recorded at gross carrying value modified in connection with a TDR during the period.
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Finance receivables and loans redefaulted during the period [Table Text Block] | The following tables present information about finance receivables and loans recorded at gross carrying value that have redefaulted during the reporting period and were within 12 months or less of being modified as a TDR. Redefault is when finance receivables and loans meet the requirements for evaluation under our charge-off policy (refer to Note 1 to the Consolidated Financial Statements in our 2017 Annual Report on Form 10-K for additional information) except for commercial finance receivables and loans, where redefault is defined as 90 days past due.
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Investment in Operating Leases, Net (Tables) |
6 Months Ended | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
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Jun. 30, 2018 | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Leases, Operating [Abstract] | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Schedule of Property Subject to or Available for Operating Lease [Table Text Block] | Investments in operating leases were as follows.
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Depreciation Expense On Operating Lease Assets [Table Text Block] | Depreciation expense on operating lease assets includes remarketing gains and losses recognized on the sale of operating lease assets. The following summarizes the components of depreciation expense on operating lease assets.
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Securitizations and Variable Interest Entities (Tables) |
6 Months Ended | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
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Jun. 30, 2018 | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Securitizations And Variable Interest Entities [Abstract] | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Schedule of Variable Interest Entities [Table Text Block] | The following table presents our involvement in consolidated and nonconsolidated VIEs in which we hold variable interests. For additional detail related to the assets and liabilities of consolidated variable interest entities refer to the Condensed Consolidated Balance Sheet.
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Schedule Of Cash Flow Received And Paid To Nonconsolidated Securitization Entities [Table Text Block] | The following table summarizes cash flows received and paid related to securitization entities and asset-backed financings where the transfer is accounted for as a sale and we have a continuing involvement with the transferred consumer automotive assets (e.g., servicing) that were outstanding during the six months ended June 30, 2018, and 2017. Additionally, this table contains information regarding cash flows received from and paid to nonconsolidated securitization entities that existed during each period.
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Schedule of Quantitative Information and Net Credit Losses about Securitized and Other Financial Assets Managed Together [Table Text Block] | The following tables present quantitative information about delinquencies and net credit losses for off-balance sheet securitizations and whole-loan sales where we have continuing involvement.
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Servicing Activities (Tables) |
6 Months Ended | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
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Jun. 30, 2018 | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Servicing Asset [Abstract] | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Schedule Of Total Serviced Automobile Loans Outstanding [Table Text Block] | The current unpaid principal balance and any related unamortized deferred fees and costs of total serviced automotive finance loans and net investment in operating leases outstanding were as follows.
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Other Assets (Tables) |
6 Months Ended | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
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Jun. 30, 2018 | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Other Assets [Abstract] | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Schedule of Other Assets [Table Text Block] | The components of other assets were as follows.
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Deposit Liabilities (Tables) |
6 Months Ended | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
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Jun. 30, 2018 | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Deposits [Abstract] | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Deposit Liabilities, Type [Table Text Block] | Deposit liabilities consisted of the following.
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Debt (Tables) |
6 Months Ended | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
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Debt Disclosure [Abstract] | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Schedule of Short-term Debt [Table Text Block] | The following table presents the composition of our short-term borrowings portfolio.
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Long-term Debt [Text Block] | The following table presents the composition of our long-term debt portfolio.
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Scheduled of Maturities of Long-term Debt [Table Text Block] | The following table presents the scheduled remaining maturity of long-term debt at June 30, 2018, assuming no early redemptions will occur. The actual payment of secured debt may vary based on the payment activity of the related pledged assets.
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Pledged assets for the payment of the related secured borrowings and repurchase agreements [Table Text Block] | The following summarizes assets restricted as collateral for the payment of the related debt obligation primarily arising from securitization transactions accounted for as secured borrowings and repurchase agreements.
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Schedule Of Committed Funding Facilities [Table Text Block] |
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Accrued Expenses and Other Liabilities (Tables) |
6 Months Ended | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
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Jun. 30, 2018 | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Accounts Payable and Accrued Liabilities [Abstract] | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Schedule of Accrued Liabilities [Table Text Block] | The components of accrued expenses and other liabilities were as follows.
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Accumulated Other Comprehensive Loss (Tables) |
6 Months Ended | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
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Jun. 30, 2018 | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Other Comprehensive Income (Loss), Net of Tax [Abstract] | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Schedule of Accumulated Other Comprehensive Income (Loss) [Table Text Block] | The following table presents changes, net of tax, in each component of accumulated other comprehensive loss.
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Reclassification out of Accumulated Other Comprehensive Income [Table Text Block] | The following tables present the before- and after-tax changes in each component of accumulated other comprehensive (loss) income.
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Earnings per Common Share (Tables) |
6 Months Ended | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
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Earnings Per Share [Abstract] | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Schedule of Earnings Per Share, Basic and Diluted [Table Text Block] | The following table presents the calculation of basic and diluted earnings per common share.
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Regulatory Capital and Other Regulatory Matters (Tables) |
6 Months Ended | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
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Regulatory Capital Requirements [Abstract] | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Schedule of Compliance with Regulatory Capital Requirements under Banking Regulations [Table Text Block] | The following table summarizes our capital ratios under the U.S. Basel III capital framework.
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Schedule of Common Share Repurchase Activity [Table Text Block] | The following table presents information related to our common stock for each quarter since the commencement of our common stock repurchase programs and initiation of a quarterly cash dividend on common stock.
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Derivative Instruments and Hedging Activities (Tables) |
6 Months Ended | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
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Derivative Instruments and Hedging Activities Disclosure [Abstract] | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Schedule of Derivative Instruments in Statement of Financial Position [Table Text Block] | The following table summarizes the amounts of derivative instruments reported on our Condensed Consolidated Balance Sheet. The amounts are presented on a gross basis, are segregated by derivatives that are designated and qualifying as hedging instruments or those that are not, and are further segregated by type of contract within those two categories. Derivative contracts in a receivable and payable position exclude open trade equity on derivatives cleared through central clearing counterparties. Any associated collateral exchanged with our central clearing counterparties are treated as settlements of the derivative exposure, rather than collateral. Such payments are recognized as settlements of the derivatives contracts in a receivable and payable position on our Condensed Consolidated Balance Sheet. Notional amounts are reference amounts from which contractual obligations are derived and are not recorded on the balance sheet. In our view, derivative notional is not an accurate measure of our derivative exposure when viewed in isolation from other factors, such as market rate fluctuations and counterparty credit risk.
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Schedule of Fair Value Hedging Instruments, Statements of Financial Performance and Financial Position, Location [Table Text Block] | The following table presents amounts recorded on our Condensed Consolidated Balance Sheet related to cumulative basis adjustments for fair value hedges.
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Derivative Instruments, Gain (Loss) [Table Text Block] | The following table summarizes the location and amounts of gains and losses on derivative instruments not designated as accounting hedges reported in our Condensed Consolidated Statement of Comprehensive Income.
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Derivative Instruments Designated as FV Hedges, Gain (Loss) [Table Text Block] | The following table summarizes the location and amounts of gains and losses on derivative instruments designated as fair value hedges reported in our Condensed Consolidated Statement of Comprehensive Income. We had no gains or losses on derivative instruments designated as cash flow hedges for the periods shown.
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Schedule of Derivative Instruments [Table Text Block] | The following table summarizes the location and amounts of gains and losses related to interest and amortization on derivative instruments designated as fair value and cash flow hedges reported in our Condensed Consolidated Statement of Comprehensive Income.
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Schedule of Derivative Instruments, Effect on Other Comprehensive Income [Table Text Block] | The following table summarizes the effect of cash flow hedges on accumulated other comprehensive loss.
The following table summarizes the effect of net investment hedges on accumulated other comprehensive loss and the Condensed Consolidated Statement of Comprehensive Income.
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Fair Value (Tables) |
6 Months Ended | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
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Fair Value Disclosures [Abstract] | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Schedule of Fair Value, Assets and Liabilities Measured on a Recurring Basis [Table Text Block] | The following tables display the assets and liabilities measured at fair value on a recurring basis including financial instruments elected for the fair value option. We often economically hedge the fair value change of our assets or liabilities with derivatives and other financial instruments. The tables below display the hedges separately from the hedged items; therefore, they do not directly display the impact of our risk management activities.
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Fair Value, Assets Measured on a Recurring Basis, Unobservable Input Reconciliation [Table Text Block] | The following tables present the reconciliation for all Level 3 assets and liabilities measured at fair value on a recurring basis. We often economically hedge the fair value change of our assets or liabilities with derivatives and other financial instruments. The Level 3 items presented below may be hedged by derivatives and other financial instruments that are classified as Level 1 or Level 2. Thus, the following tables do not fully reflect the impact of our risk management activities.
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Fair Value Measurements - Nonrecurring Basis [Table Text Block] | The following tables display the assets and liabilities measured at fair value on a nonrecurring basis.
n/m = not meaningful
n/m = not meaningful
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Financial Instruments Disclosure [Table Text Block] | The following table presents the carrying and estimated fair value of financial instruments, except for those recorded at fair value on a recurring basis presented in the previous section of this note titled Recurring Fair Value. When possible, we use quoted market prices to determine fair value. Where quoted market prices are not available, the fair value is internally derived based on appropriate valuation methodologies with respect to the amount and timing of future cash flows and estimated discount rates. However, considerable judgment is required in interpreting current market data to develop the market assumptions and inputs necessary to estimate fair value. As such, the actual amount received to sell an asset or the amount paid to settle a liability could differ from our estimates. Fair value information presented herein was based on information available at June 30, 2018, and December 31, 2017.
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Offsetting Assets and Liabilities (Tables) |
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Offsetting Assets and Liabilities [Abstract] | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Offsetting Assets and liabilities [Table Text Block] | The composition of offsetting derivative instruments, financial assets, and financial liabilities was as follows.
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Segment Information (Tables) |
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Segment Reporting [Abstract] | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Schedule of Segment Reporting Information, by Segment [Table Text Block] | Financial information for our reportable operating segments is summarized as follows.
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Parent and Guarantor Condensed Consolidating Financial Statements (Tables) |
6 Months Ended | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
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Organization, Consolidation and Presentation of Financial Statements [Abstract] | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Condensed Income Statement [Table Text Block] | Condensed Consolidating Statements of Comprehensive Income
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Condensed Balance Sheet [Table Text Block] | Condensed Consolidating Balance Sheet
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Parent Guarantor Consolidating Statement of Cash Flows [Table Text Block] | Condensed Consolidating Statement of Cash Flows
The following table provides a reconciliation of cash and cash equivalents and restricted cash from the Condensed Consolidated Balance Sheet to the Condensed Consolidated Statement of Cash Flows.
The following table provides a reconciliation of cash and cash equivalents and restricted cash from the Condensed Consolidated Balance Sheet to the Condensed Consolidated Statement of Cash Flows.
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Description of Business, Basis of Presentation, and Changes in Significant Accounting Policies (Details) - USD ($) $ in Millions |
Jun. 30, 2018 |
Jan. 01, 2018 |
---|---|---|
Accounting Standards Update 2014-09 [Member] | ||
New Accounting Pronouncements or Change in Accounting Principle [Line Items] | ||
Cumulative Effect of New Accounting Principle in Period of Adoption | $ 126 | $ 126 |
Accounting Standards Update 2016-01 [Member] | ||
New Accounting Pronouncements or Change in Accounting Principle [Line Items] | ||
Cumulative Effect of New Accounting Principle in Period of Adoption | 20 | (7) |
Accounting Standards Update 2018-02 [Member] | ||
New Accounting Pronouncements or Change in Accounting Principle [Line Items] | ||
Cumulative Effect of New Accounting Principle in Period of Adoption | $ (42) | $ 0 |
Other Income, Net of Losses (Schedule of Other Income, Net of Losses) (Details) - USD ($) $ in Millions |
3 Months Ended | 6 Months Ended | ||
---|---|---|---|---|
Jun. 30, 2018 |
Jun. 30, 2017 |
Jun. 30, 2018 |
Jun. 30, 2017 |
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Other Nonoperating Income (Expense) [Abstract] | ||||
Fees and Commissions, Other | $ 25 | $ 25 | $ 54 | $ 52 |
Remarketing Fees | 21 | 27 | 44 | 56 |
Contractually Specified Servicing Fee, Late Fee, and Ancillary Fee Earned in Exchange for Servicing Financial Asset | 8 | 14 | 16 | 30 |
Income (Loss) from Equity Method Investments | 7 | 5 | 13 | 5 |
Other Income | 36 | 31 | 79 | 73 |
Noninterest Income, Other Operating Income | $ 97 | $ 102 | $ 206 | $ 216 |
Other Operating Expenses (Schedule Of Other Operating Expenses) (Details) - USD ($) $ in Millions |
3 Months Ended | 6 Months Ended | ||
---|---|---|---|---|
Jun. 30, 2018 |
Jun. 30, 2017 |
Jun. 30, 2018 |
Jun. 30, 2017 |
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Operating Expenses [Abstract] | ||||
Insurance Commissions | $ 109 | $ 104 | $ 219 | $ 203 |
Communications and Information Technology | 74 | 71 | 145 | 140 |
Lease And Loan Administration | 40 | 39 | 82 | 75 |
Marketing and Advertising Expense | 29 | 33 | 68 | 63 |
Professional Fees | 35 | 27 | 67 | 53 |
Federal Deposit Insurance Corporation Premium Expense | 35 | 28 | 65 | 55 |
Vehicle remarketing and repossession | 26 | 25 | 58 | 53 |
Depreciation, Nonproduction | 22 | 23 | 42 | 45 |
Occupancy, Net | 11 | 11 | 22 | 23 |
Taxes, Miscellaneous | 6 | 8 | 14 | 16 |
Amortization of Intangible Assets | 3 | 3 | 6 | 6 |
Other Cost and Expense, Operating | 56 | 48 | 103 | 93 |
Other Noninterest Expense | $ 446 | $ 420 | $ 891 | $ 825 |
Investment Securities (Investment Income) (Details) - USD ($) $ in Millions |
3 Months Ended | 6 Months Ended | ||
---|---|---|---|---|
Jun. 30, 2018 |
Jun. 30, 2017 |
Jun. 30, 2018 |
Jun. 30, 2017 |
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Taxable interest | $ 164 | $ 130 | $ 318 | $ 249 |
Taxable dividends | 3 | 3 | 6 | 5 |
Interest and dividends exempt from U.S. federal income tax | 6 | 6 | 12 | 11 |
Interest and Dividend Income, Securities, Operating, Available-for-sale | 188 | 146 | 364 | 280 |
Excludes Other Earning Assets [Member] | ||||
Interest and Dividend Income, Securities, Operating, Available-for-sale | $ 173 | $ 139 | $ 336 | $ 265 |
Investment Securities (Schedule Of Realized Gain (Loss)) (Details) - USD ($) $ in Millions |
3 Months Ended | 6 Months Ended | ||
---|---|---|---|---|
Jun. 30, 2018 |
Jun. 30, 2017 |
Jun. 30, 2018 |
Jun. 30, 2017 |
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Available-for-sale Securities [Abstract] | ||||
Other than Temporary Impairment Losses, Investments, Available-for-sale Securities | $ 0 | $ 0 | $ 0 | $ 0 |
Available-for-sale Securities, Gross Realized Gains | 1 | 24 | 7 | 51 |
Available-for-sale Securities, Gross Realized Losses | 0 | (1) | 0 | (1) |
Available-for-sale Securities, Gross Realized Gain (Loss) | 1 | 23 | 7 | 50 |
Net realized gain (loss) on equity securities | 18 | 40 | ||
Available-for-sale Equity Securities, Gross Unrealized Gain | (8) | 32 | ||
Gain (Loss) on Investments | $ 27 | $ 23 | $ 15 | $ 50 |
Finance Receivables and Loans, Net (Schedule of Sales of Financing Receivables and Loans) (Details) - USD ($) $ in Millions |
3 Months Ended | 6 Months Ended | ||
---|---|---|---|---|
Jun. 30, 2018 |
Jun. 30, 2017 |
Jun. 30, 2018 |
Jun. 30, 2017 |
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Accounts, Notes, Loans and Financing Receivable [Line Items] | ||||
Financing Receivable, Significant Sales and Transfers | $ 4 | $ 88 | $ 5 | $ 1,304 |
Consumer Portfolio Segment [Member] | Automobile Loan [Member] | ||||
Accounts, Notes, Loans and Financing Receivable [Line Items] | ||||
Financing Receivable, Significant Sales and Transfers | 0 | 85 | 0 | 1,298 |
Consumer Portfolio Segment [Member] | Residential Mortgage [Member] | ||||
Accounts, Notes, Loans and Financing Receivable [Line Items] | ||||
Financing Receivable, Significant Sales and Transfers | $ 4 | $ 3 | $ 5 | $ 6 |
Finance Receivables and Loans, Net (Schedule of Purchases of Financing Receivables and Loans) (Details) - USD ($) $ in Millions |
3 Months Ended | 6 Months Ended | ||
---|---|---|---|---|
Jun. 30, 2018 |
Jun. 30, 2017 |
Jun. 30, 2018 |
Jun. 30, 2017 |
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Accounts, Notes, Loans and Financing Receivable [Line Items] | ||||
Financing Receivable, Significant Purchases | $ 1,085 | $ 1,420 | $ 2,548 | $ 1,815 |
Consumer Portfolio Segment [Member] | Automobile Loan [Member] | ||||
Accounts, Notes, Loans and Financing Receivable [Line Items] | ||||
Financing Receivable, Significant Purchases | 233 | 611 | 401 | 679 |
Consumer Portfolio Segment [Member] | Residential Mortgage [Member] | ||||
Accounts, Notes, Loans and Financing Receivable [Line Items] | ||||
Financing Receivable, Significant Purchases | $ 852 | $ 809 | $ 2,147 | $ 1,136 |
Investment in Operating Leases, Net (Investments In Operating Leases) (Details) - USD ($) $ in Millions |
Jun. 30, 2018 |
Dec. 31, 2017 |
---|---|---|
Leases, Operating [Abstract] | ||
Property Subject to or Available for Operating Lease, Gross | $ 10,260 | $ 10,556 |
Property Subject to or Available for Operating Lease, Accumulated Depreciation | (1,621) | (1,815) |
Property Subject to or Available for Operating Lease, Net | $ 8,639 | $ 8,741 |
Investment in Operating Leases, Net (Schedule Of Depreciation Expense On Operating Lease Assets) (Details) - USD ($) $ in Millions |
3 Months Ended | 6 Months Ended | ||
---|---|---|---|---|
Jun. 30, 2018 |
Jun. 30, 2017 |
Jun. 30, 2018 |
Jun. 30, 2017 |
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Leases, Operating [Abstract] | ||||
Depreciation Expense On Operating Lease Assets | $ 281 | $ 353 | $ 572 | $ 739 |
Gross Remarketing (Gains) Losses | (16) | (32) | (34) | (29) |
Operating Leases, Income Statement, Depreciation Expense on Property Subject to or Held-for-lease | $ 265 | $ 321 | $ 538 | $ 710 |
Deposit Liabilities (Schedule of Deposit Liabilities) (Details) - USD ($) $ in Millions |
Jun. 30, 2018 |
Dec. 31, 2017 |
---|---|---|
Deposits [Abstract] | ||
Noninterest-bearing deposit liabilities | $ 153 | $ 108 |
Interest-bearing Deposit Liabilities, by Component [Abstract] | ||
Deposits, Savings Deposits | 50,958 | 49,267 |
Time Deposits | 47,617 | 43,869 |
Dealer deposits | 6 | 12 |
Deposits | 98,734 | 93,256 |
Time Deposits, $100,000 or More | 19,900 | 18,900 |
Time Deposits, at or Above FDIC Insurance Limit | $ 5,300 | $ 5,300 |
Debt (Narrative - Trust Preferred Securities) (Details) $ / shares in Units, $ in Billions |
Jun. 30, 2018
USD ($)
$ / shares
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Dec. 31, 2017
USD ($)
|
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Narrative - Trust Preferred Securities [Line Items] | ||
Trust preferred securities | $ 2.6 | $ 2.6 |
Debt Instrument, Interest Rate, Stated Percentage | 8.125% | |
Preferred Stock, Liquidation Preference Per Share | $ / shares | $ 25 | |
Distributions will be payable at an annual rate equal to three-month London interbank offer rate plus: | 5.785% | |
Ally has the right to defer payments of interest for a period not exceeding consecutive quarters of: | 20 | |
Percent of principle debt, plus accrued and unpaid interest is the redemption price if Ally redeems the Series 2 TRUPS at anytime on or before February 15, 2040. | 100.00% | |
Fixed Income Interest Rate [Member] | ||
Narrative - Trust Preferred Securities [Line Items] | ||
Trust preferred securities | $ 2.6 |
Accrued Expenses and Other Liabilities (Schedule of Accrued Expenses and Other Liabilities) (Details) - USD ($) $ in Millions |
Jun. 30, 2018 |
Dec. 31, 2017 |
Jun. 30, 2017 |
Dec. 31, 2016 |
---|---|---|---|---|
Accounts Payable and Accrued Liabilities [Abstract] | ||||
Accounts Payable | $ 369 | $ 746 | ||
Accrued Employee Benefits | 188 | 248 | ||
Liability for Claims and Claims Adjustment Expense | 149 | 140 | $ 179 | $ 149 |
Derivative Liability, Fair Value, Gross Liability | 65 | 41 | ||
Cash collateral received from counterparties | 39 | 17 | ||
Deferred Revenue | 28 | 32 | ||
Other Accrued Liabilities | 673 | 556 | ||
Accounts Payable and Accrued Liabilities | $ 1,511 | $ 1,780 |
Regulatory Capital and Other Regulatory Matters (Common Share Repurchases) (Details) - USD ($) $ / shares in Units, $ in Millions |
Jun. 30, 2018 |
Mar. 31, 2018 |
Dec. 31, 2017 |
Sep. 30, 2017 |
Jun. 30, 2017 |
Mar. 31, 2017 |
Dec. 31, 2016 |
Sep. 30, 2016 |
Jun. 30, 2016 |
---|---|---|---|---|---|---|---|---|---|
Accelerated Share Repurchases [Line Items] | |||||||||
Treasury Stock, Common, Value | $ 195 | $ 185 | $ 190 | $ 190 | $ 204 | $ 169 | $ 167 | $ 159 | |
Treasury Stock, Common, Shares | 7,280,000 | 6,473,000 | 7,033,000 | 8,507,000 | 10,485,000 | 8,097,000 | 8,745,000 | 8,298,000 | |
Common Stock, Shares, Outstanding | 437,053,936 | ||||||||
Dividends Payable, Amount Per Share | $ 0.13 | $ 0.13 | $ 0.12 | $ 0.12 | $ 0.08 | $ 0.08 | $ 0.08 | $ 0.08 | |
Beginning of Period [Member] | |||||||||
Accelerated Share Repurchases [Line Items] | |||||||||
Common Stock, Shares, Outstanding | 432,691,000 | 437,054,000 | 443,796,000 | 452,292,000 | 462,193,000 | 467,000,000 | 475,470,000 | 483,753,000 | |
End of Period [Member] | |||||||||
Accelerated Share Repurchases [Line Items] | |||||||||
Common Stock, Shares, Outstanding | 425,752,000 | 432,691,000 | 437,054,000 | 443,796,000 | 452,292,000 | 462,193,000 | 467,000,000 | 475,470,000 |
Derivative Instruments and Hedging Activities (Narrative) (Details) - USD ($) $ in Millions |
Jun. 30, 2018 |
Dec. 31, 2017 |
---|---|---|
Derivative Instruments and Hedging Activities Disclosure [Abstract] | ||
Cash Collateral Placed with Counterparties Excluding Cash Collateral Associated with Repurchase Agreements | $ 31 | $ 20 |
Securities Collateral Placed with Counterparties | 151 | 97 |
Cash Collateral Received from Counterparties, Excluding Collateral Associated with Repurchase Agreements | 38 | 17 |
Non-cash collateral received from Counterparties | $ 11 | $ 2 |
Derivative Instruments and Hedging Activities (Derivative Instruments Used in Net Investment Hedge Accounting Relationships) (Details) - USD ($) $ in Millions |
3 Months Ended | 6 Months Ended | ||
---|---|---|---|---|
Jun. 30, 2018 |
Jun. 30, 2017 |
Jun. 30, 2018 |
Jun. 30, 2017 |
|
Interest Rate Contract [Member] | Cash Flow Hedging [Member] | ||||
Derivative Instruments, Gain (Loss) [Line Items] | ||||
Derivative Instruments, Gain (Loss) Recognized in Other Comprehensive Income (Loss), Effective Portion, Net | $ 5 | $ 1 | $ 23 | $ 1 |
Foreign Exchange Contract [Member] | Net Investment Hedging [Member] | ||||
Derivative Instruments, Gain (Loss) [Line Items] | ||||
Derivative Instruments, Gain (Loss) Recognized in Other Comprehensive Income (Loss), Effective Portion, Net | $ 3 | $ (4) | $ 7 | $ (6) |
Income Taxes (Details) - USD ($) $ in Millions |
3 Months Ended | 6 Months Ended | |||
---|---|---|---|---|---|
Jun. 30, 2018 |
Jun. 30, 2017 |
Jun. 30, 2018 |
Jun. 30, 2017 |
Jan. 01, 2018 |
|
Income Tax Disclosure [Abstract] | |||||
Income Tax Expense (Benefit) | $ 113 | $ 122 | $ 189 | $ 235 | |
Accounting Standards Update 2018-02 [Member] | |||||
Tax Act Impacts [Line Items] | |||||
Cumulative Effect of New Accounting Principle in Period of Adoption | $ 42 | $ 42 | $ 0 |
Subsequent Events (Details) - $ / shares |
Jul. 13, 2018 |
Jun. 30, 2018 |
Mar. 31, 2018 |
Dec. 31, 2017 |
Sep. 30, 2017 |
Jun. 30, 2017 |
Mar. 31, 2017 |
Dec. 31, 2016 |
Sep. 30, 2016 |
---|---|---|---|---|---|---|---|---|---|
Subsequent Event [Line Items] | |||||||||
Dividends Payable, Amount Per Share | $ 0.13 | $ 0.13 | $ 0.12 | $ 0.12 | $ 0.08 | $ 0.08 | $ 0.08 | $ 0.08 | |
Subsequent Event [Member] | |||||||||
Subsequent Event [Line Items] | |||||||||
Dividends Payable, Amount Per Share | $ 0.15 |
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