Best of the Bank: Ally Financial

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<b>Ally Financial Inc.</b>, previously known as <b>GMAC Inc.</b> (an acronym for <b>General Motors Acceptance Corporation</b>), is a bank holding company headquartered in Detroit, Michigan, United States at Tower 200 of the Renaissance Center.<br />
The bank has more than 15 million customers worldwide and provides a range of financial services including auto financing, corporate financing, insurance, mortgage services, and online banking. In 2009, Ally employed 18,900 people. In 2008, the firm provided financing to 75% of the 6,450 General Motors dealers.<br />
The company was bailed out by the US Government during the financial crisis of 2007â€“08 taking over from its previous owner General Motors. On 24 December 2008, the Federal Reserve accepted then-GMAC's application to become a bank holding company. Ally returned to profitability in 2010, posting a net profit of $1.075Â billion for the fiscal year. Ally planned but did not execute an initial public stock offering in 2011. Ally announced plans to launch an IPO in spring 2014, and the shares began to be traded as NYSE:ALLY on Apr 10, 2014. The US Government sold its remaining shares in December 2014.<br />
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<h2>
<span id="History">History</span></h2>
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The company was founded in 1919 by General Motors Corporation as the General Motors Acceptance Corporation (GMAC) to be a provider of financing to automotive customers. Over the following years the business has expanded to include insurance, online banking, mortgage operations, and commercial finance.<br />
In 1919, GMAC branches opened in Detroit, New York, Chicago, San Francisco, and Toronto.<br />
In 1985, GMAC formed GMAC Mortgage after it acquired the mortgage loan operations of the Colonial Mortgage Service companies and the servicing arm of the former Norwest Mortgage, Inc. In subsequent years, the division acquired additional mortgage-related operations, including ditech.com, and in 2005 the division was reorganized into Residential Capital (ResCap). By that time, the company was heavily into subprime lending.<br />
In 2000, GMAC was given conditional approval to form GMAC Bank.<br />
In 2006, General Motors Corporation sold a 51% interest in GMAC to Cerberus Capital Management, a private equity company. (The next year, Cerberus acquired Chrysler Corporation.) Also in 2006, GMAC divested a majority stake of GMAC Commercial Holdings, its real estate division, to a trio of investors â€” Goldman Sachs, KKR and Five Mile Capital Partners â€” thereby creating Capmark Financial Group Inc. Capmark later filed for bankruptcy and was acquired in part jointly by Leucadia and Berkshire Hathaway.<br />
On December 29, 2008, the United States Department of the Treasury invested $5Â billion in GMAC from its $700Â billion Troubled Asset Relief Program (TARP).<br />
On May 15, 2009, GMAC's banking unit changed its name to Ally Bank.<br />
On May 21, 2009, the U.S. Treasury announced it would invest an additional $7.5Â billion in GMAC LLC, which gave the U.S. government a majority stake in the company.<br />
On December 30, 2009, the U.S. Treasury department said that they would invest another $3.8Â billion in GMAC because the company had been unable to raise additional funds in the private sector. This raised the total government investment in GMAC to $16.3Â billion.<br />
On May 10, 2010, GMAC Inc. announced that it re-branded itself as Ally Financial Inc.<br />
On August 25, 2010, Ally briefs its customer Freddie Mac that it would hold a moratorium on foreclosures and evictions. "Ally Financial officials knew a large number of documents submitted in support of mortgage foreclosure proceedings were mishandled as early as August, but did not take action to stop the evictions until last week, according to a Bloomberg report" stated Washington Post reportage dated September 24, 2010.<br />
On September 20, 2010, Ally announces that, effective October 1, 2010, it will halt evictions on homes in 23 states due to 'an important but technical defect' in its foreclosure filings. (See "Robo Signing" below)<br />
On December 30, 2010, the U.S. Treasury announced it would be converting $5.5Â billion of interest-bearing preferred Ally stock into common equity.<br />
On March 31, 2011, Ally Financial filed with the SEC for an initial public offering, although was not pursued due to stock market volatility of summer 2011.<br />
On November 9, 2011, the bank announced it was considering filing for bankruptcy-protection for its ResCap mortgage unit, after the unit's loan write-downs of around half a billion dollars brought it close to the legally required net asset value threshold of $250Â million.<br />
As of January, 2012, TARP had about $12Â billion invested in Ally. The government stake represented a 74% ownership interest in Ally. In March, 2012, Ally failed the Federal Reserve's financial "stress test" for capital adequacy. The company said in a statement that the Fed's â€œanalysis dramatically overstates potential contingent mortgage riskâ€. A possible outcome would be a requirement to raise additional capital.<br />
On May 15, 2012, the company put its ResCap subsidiary into Chapter 11 bankruptcy after it failed to make an interest payment of $20 million on unsecured debt. ResCap had written off $22 billion in mortgages in 2009, 2010, and 2011 much of it subprime mortgages. The move was seen as attempt for the company to focus on its profitable core business of auto loans and direct banking (Ally showed a $2.72 billion profit in 2011 in its auto finance unit but had a $402 million loss at ResCap).<br />
In mid-2013, financial columnist Allan Sloan wrote that he thought the Ally bailout would yield a modest profit for the US Treasury.<br />
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By my conservative math, that [US] stake is worth $1.5 billion more than it cost. And Iâ€™m not including the $6.1 billion of dividends the government has collected from Ally. Taxpayers coming out ahead on a company that spent $8.3 billion, all of it lost, to keep ResCap afloat? That has committed another $2.3 billion to settle its ResCap liabilities? Yes, itâ€™s true.</blockquote>
Sloan also opined that Cerberus Capital and its private-equity investors were "down almost 75 percent on their $8.15 billion Ally investment". Sloan emphasized that his analyses were vulnerable to changing factors before final disposition.<br />
<h2>
<span id="Structure">Structure</span></h2>
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<img alt="Ally Asks: What's Your New Year's Resolution? | Straight Talk Blog ..." src="http://community.ally.com/straight-talk/wp-content/uploads/2013/01/Ally_Asks_word_cloud_v2.png" title="Ally Asks: What's Your New Year's Resolution? | Straight Talk Blog ..." /></div>
As of December 2010, 73.8% of Ally was owned by the United States Treasury, with the remainder divided between Cerberus Capital Management, General Motors, and other investors.<br />
The company's Global Automotive Services offer retail auto financing and leasing; dealer lines of credit for vehicle inventory, equipment or facilities; insurance coverages including retail vehicle service contracts and commercial insurance; and remarketing services through physical auctions and online services. Ally Financial also operates Ally Servicing (previously Semperian) within its Global Automotive Services division. Ally Servicing provides customer relationship management, servicing, and collection through several inbound call centers across the U.S.<br />
Ally Financial's mortgage subsidiaries include Residential Capital, LLC (ResCap) and the mortgage activities of Ally Bank and ResMor Trust. Through these divisions, the company focuses primarily on the residential real estate market in the U.S. Business activities include the origination, purchase, servicing, sale and securitization of residential mortgage loans.<br />
GMAC Home Services is the parent for GMAC Real Estate, formed by the purchase of Better Homes and Gardens Real Estate in 1998, and GHS Mortgage. Brookfield Residential Property Services purchased the GMAC Home Services business in September 2008. Brookfield is a wholly owned subsidiary of Brookfield Asset Management, a global asset manager located in Toronto, Canada.<br />
Ally Financial's subsidiary bank in the U.S., Ally Bank, offers savings products, including certificates of deposit (CDs), online savings accounts, interest checking accounts and money market accounts. ResMor Trust Company offers Ally-branded deposit products in Canada, including online savings, guaranteed investment certificates (GIC) and tax free products. Ally Bank and ResMor Trust Company are members of the Federal Deposit Insurance Corporation and Canadian Deposit Insurance Corporation respectively.<br />
<h2>
<span id="Legal_action_over_robo-signing">Legal action over robo-signing</span></h2>
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<img alt="Ally Auto Mobile Pay - Making Vehicle Payments Just Got Easier ..." src="https://www.ally.com/resources/pres/auto/images/AAOS_Services_Slide_One.jpg" title="Ally Auto Mobile Pay - Making Vehicle Payments Just Got Easier ..." /></div>
On October 6, 2010 Attorney General of Ohio Richard Cordray filed suit against Ally Financial Inc seeking $25,000 in penalties for each instance of fraud, in addition to undisclosed amount of consumer restitution. The action could potentially mean hundreds or thousands of individual penalties for each instance of robo-signing that occurred in the state of Ohio.<br />
<h2>
<span id="Sponsorships">Sponsorships</span></h2>
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<img alt="Why Ally Didn't Want Me - Andera Blog" src="http://blog.andera.com/wp-content/uploads/2013/11/Ally-Letter-2.jpg" title="Why Ally Didn't Want Me - Andera Blog" /></div>
<h3>
<span id="College_Bowl_Game">College Bowl Game</span></h3>
From 2001 to 2010, GMAC sponsored the GMAC Bowl played annually at Ladd Peebles Stadium in Mobile, Alabama.<br />
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<span id="NASCAR_Driver">NASCAR Driver</span></h3>
GMAC sponsored Ricky Hendrick in the NASCAR Busch Series in 2000, Brian Vickers in the #5 GMAC Chevrolet in the Busch Series in 2003 and in the #25 GMAC/ditech.com Chevrolet in the Nextel Cup Series in 2004. In 2007 GMAC sponsored Casey Mears with co-sponsorship from the United States National Guard.<br />
<h2>
<span id="See_also">See also</span></h2>
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<img alt="GM Financial Double Crosses Their Ally - The Truth About Cars" src="http://images.thetruthaboutcars.com/2013/05/GM-Establishes-GM-Financial-1024x539.jpg" title="GM Financial Double Crosses Their Ally - The Truth About Cars" /></div>
<ul>
<li>List of banks</li>
<li>List of banks in United States</li>
<li>John McNamara â€” former United States businessman, who was convicted of a Ponzi scheme fraud through gaining loans to a value of $6Bn from General Motors financing arm GMAC, to develop a $400M car sales and property development business.</li>
</ul>
<ul>
<li>Roger Smith â€” former Chairman & CEO of General Motors Corporation from 1981â€“1990.</li>
</ul>
<h2>
<span id="References">References</span></h2>
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<img alt="Ally Bank Reviews & Ratings - View Accounts, Interest Rates, & Fees" src="http://img1.findthebest.com/sites/default/files/765/media/images/Ally_Bank_6583211.jpg" title="Ally Bank Reviews & Ratings - View Accounts, Interest Rates, & Fees" /></div>
<h2>
<span id="External_links">External links</span></h2>
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<img alt="Ally Auto Mobile Pay - Making Vehicle Payments Just Got Easier ..." src="https://www.ally.com/resources/pres/auto/images/AAOS_Services_Slide_Four.jpg" title="Ally Auto Mobile Pay - Making Vehicle Payments Just Got Easier ..." /></div>
<ul>
<li>Ally Bank (U.S.), official website</li>
<li>Ally (Canada), official website</li>
<li>Vintage GMAC Commercial</li>
<li>Ally Auto (U.S.)</li>
</ul>
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Ally Financial - Who Owns Ally Bank

Ally Financial Inc. , previously known as GMAC Inc. (an acronym for General Motors Acceptance Corporation ), is a bank holding company ...

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