Ally Financial Sees 2026 Margin Rebound, Targets Mid-Teens Returns at BofA Conference

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• Ally generated record application flow in 2025, decisioned $0.5 trillion in consumer loan and lease applications, and added nearly $44 billion to balance sheet at 9.7% yields

  80% confidence

• Ally's deposit franchise has produced 67 straight quarters of customer growth since bank launched in 2009

  80% confidence

• Ally is OEM-agnostic in Dealer Financial Services

  80% confidence

• Ally expects enough capital generation to support loan growth, dividends, continued improvement in CET1 ratio toward the nines over time, and buybacks

  80% confidence

• Ally's deposits franchise is a crown jewel

  80% confidence

• Ally experienced a one-in-200-year weather event in 2025 that pushed combined ratio above 100%, but still generated ROE approaching 20%

  80% confidence

• Ally would view 2026 as a success even if deposit balances remain more or less flat, provided customer retention, customer growth, and progress toward terminal deposit beta continue

  80% confidence

• Ally exited the year with net interest margin around 350 basis points

  80% confidence

• The consumer has remained resilient and portfolio performance has been encouraging

  80% confidence

• The vast majority of the lease portfolio is performing in line with expectations, but a handful of models—literally four models—are underperforming

  80% confidence

• Full-year 2026 margin guidance of 360-370 basis points implies a really solid degree of margin expansion the back half of the year

  80% confidence

• Ally effectively checked two of three boxes for mid-teens returns in 2025: retail auto credit losses of 1.97% and flat expenses

  80% confidence

• Ally views auto as core to its identity, not transactional or episodic

  80% confidence

• Ally expects margin to be flat for a quarter or two following Federal Reserve easing late last year

  80% confidence

• Ally is more than core-funded with vast majority of deposits FDIC-insured

  80% confidence

• Corporate Finance will grow over time but not at the expense of risk-adjusted returns

  80% confidence

• Ally's longer-term through-the-cycle loss view is 1.6-1.8%

  80% confidence

• Ally expects a small decline in net interest margin in Q1 2026

  80% confidence

• About $35 billion of CDs are maturing in 2026, with estimated 45-50 basis point refinancing benefit tailwind

  80% confidence

• Ally saw solid operational and execution across all businesses in 2025

  80% confidence

• Higher-yielding retail auto and Corporate Finance loans at 9% or greater will replace lower-yielding mortgage and investment securities around 3% or lower

  80% confidence

• Unemployment has increased by about 30 basis points over the past 12 months

  80% confidence

• Current retail auto net charge-off performance trends point to the midpoint of 1.8-2.0% guidance range

  80% confidence

• Since Ally went public in 2014, the average annualized loss rate in Corporate Finance has been about 30 basis points while the asset base has grown

  80% confidence

• Buyback approach is an 'and question,' not an 'or question,' and will be balanced against other strategic objectives

  80% confidence

• Ally generated lease termination losses in Q4 and expects that phenomenon to continue early in 2026

  80% confidence

• Ally's dealer and deposits value propositions are not easily replicable

  80% confidence

• Ally's bias is for more growth in insurance, citing dealer importance, capital efficiency, durable fee income diversification, and returns in excess of mid-teen target

  80% confidence

• Ally's recent strategic shift has centered on doubling down on the core franchises

  80% confidence

• Execution toward sustainable mid-teen returns should ultimately address investor skepticism around the company's valuation multiple

  80% confidence