Profit of Ally Financial more than doubles

Profit of Ally Financial more than doubles

According to Ally Financial Inc, its quarterly profit more than doubled and a one-time after-tax gain of about $400 million helped. The amount is associated with a stake sale in its joint venture with a Chinese auto lender.

Ally shares rose 1.4% at $20.59 in premarket trading. For the first quarter that ended on March 31, its net income increased to $576 million, or $1.06 per share, from $227 million, or 33 cents per share, a year ago. In January, Ally completed the sale of its 40% interest in the joint venture to General Motors Co for $1 billion.

Ally reported that core pre-tax income of $490 million, apart from repositioning items, increased from $339 million a year ago. The company earned 52 cents per share, on an adjusted basis.

According to Thomson Reuters I/B/E/S, analysts on average expected earnings of 42 cents per share. A pre-tax income of $331 million, down slightly from $339 million, a year ago has been reported by Ally's auto finance business.

Total non-interest expense decreased 2.5% to $695 million. The company employs approximately 800 people in the Charlotte area, where it has had an existence since 2009. According to the company, it became the favoured financing source for Mitsubishi Motors in the United States. It replaced the Japanese carmaker's captive finance company, Mitsubishi Motors Credit of America Inc.

Ally CEO Jeffrey Brown said in a statement, "First quarter results demonstrate that our efforts to diversify and expand our leading franchises, while improving shareholder returns, are already making significant inroads".