US digital lender Ally Financial posts Q1 2021 net income of £796m. This contrasts with a net loss of $319m for the corresponding period a year ago.
First quarter highlights include retail deposits up by 21% year-on-year to $128.4bn. Over the same period, total retail deposit customer numbers rise by 14% to 2.33 million.
Meantime, Ally Home direct-to-consumer mortgage originations soar by 145% y-o-y to $1.8bn. In addition, Ally Invest net customer assets rise by 93% y-o-y to $14.5bn.
And Ally self-directed accounts are ahead by 14% y-o-y to 425,000.
Ally Financial Q1 2021: other positive metrics
Auto finance pre-tax income of $803m is up by $976m y-o-y. Moreover, despite ongoing margin pressure, the net interest margin for Ally is up by 50 basis points y-o-y to 3.16%.
At the same time, provision for credit losses decreases by $916m y-o-y. This is primarily due to Covid-related reserve build in the first quarter of 2020 and lower auto charge-offs.
Consumer auto originations increase by 12% y-o-y to $10.2bn. Other highlights include corporate finance, with pre-tax income of $53m, up $121m y-o-y. Finally, mortgage pre-tax income of $23m is up by $11m year-over-year.
Less positive metrics include non-interest expenses, up by $23m y-o-y. This is driven primarily by increased staffing and investments to support business growth.
Ally CEO flags up Do it right culture
“Ally’s strong first quarter performance demonstrates our continued ability to navigate the complexities of the pandemic and emerge as a stronger and more resilient company,” says Ally CEO Jeffrey Brown.
“The impressive momentum we carried into 2021 was fuelled by our leading and adaptable auto and digital banking platforms. And a culture centred around our promise to ‘Do It Right’ for our customers, employees and communities. This disciplined approach, along with our focus on generating long-term value for all our stakeholders, guides our strategy and positions us for continued success.”
Ally Financial’s share price of $47.71 gives a market cap of about $17.8bn and is up 34% year-to-date.