Ally Financial’s CET1 capital ratio increases to 9.4%

By Devika Patel

Knoxville, Tenn., Jan. 22 – Ally Financial Inc. reported that its Common Equity Tier 1 capital ratio increased slightly year over year, ending the year at 9.4%.

“[Our] CET1 of 9.4% increased quarter over quarter,” chief financial officer Russell Hutchinson said on the company’s fourth quarter and year ended Dec. 31 earnings conference call on Jan. 19.

“The [pending] sale of [Ally Lending] will add another 15 basis points upon closing in March.

“We expect a relatively flat CET1 ratio in the first quarter, as the Ally Lending sale benefit will be offset by CECL phase-in,” Hutchinson said.

The company deconsolidated $1.7 billion of retail auto loans to increase the CET1 ratio last quarter.

“Within the quarter, we deconsolidated $1.7 billion of retail auto loans from the balance sheet through securitization transactions, adding 9 basis points of CET1,” chief executive officer Jeffrey J. Brown said on the call.

The automotive financial services company is based in Detroit.

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