Held-for-sale Operations

6 Months Ended

Jun. 30, 2025

Discontinued Operations and Disposal Groups [Abstract]

Held-for-sale Operations

Held-for-sale Operations

On January 20, 2025, we formally approved our commitment to divest our credit card operations, Ally Credit Card, and entered a definitive agreement with CardWorks, Inc. During the six months ended June 30, 2025, the assets and liabilities of Ally Credit Card were transferred to assets and liabilities of operations held-for-sale and sold. The sale occurred on April 1, 2025. Ally Credit Card was a component of our Corporate and Other segment. The related operating results have been presented within continuing operations in the Condensed Consolidated Statement of Comprehensive Income for all periods presented.

During the fourth quarter of 2024, we began exploring strategic alternatives for Ally Credit Card, which resulted in a triggering event for goodwill impairment purposes, and recognized an $118 million goodwill impairment charge.

In connection with the classification of the operations as held-for-sale, the disposal group was measured at the lower-of-cost or fair value. First, the finance receivables and loans, along with the remaining assets and liabilities, were classified as held-for-sale and measured at the lower-of-cost or fair value. The fair value was determined based on the sales agreement with the third-party purchaser. Next, the carrying value of the disposal group was compared to fair value, which resulted in a goodwill impairment charge. Lastly, we recorded a valuation allowance on other assets related to estimated selling expenses. As a result, we recognized a net pretax loss of $8 million during the six months ended June 30, 2025, which was comprised of a benefit of $306 million to our provision for credit losses, offset by a $2 million asset impairment related to Ally Credit Card branded plastics, a goodwill impairment charge of $305 million, and a valuation allowance on other assets of $7 million. We do not expect to recognize any significant incremental costs related to this transaction.