Ally Financial flags 'intensifying' credit challenges; shares slump (updated)

Ally Financial

10/09/2024 15:52

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       Sept 10 (Reuters) - Ally Financial's  ALLY.N  credit
challenges have intensified over the quarter as borrowers
struggled with high inflation and costs of living, the consumer
lender's chief financial officer Russell Hutchinson said on
Tuesday, sending its shares down 17%.
    Delinquencies in the company's retail auto business rose
about a cumulative 20 basis points in July and August compared
to its expectations, Hutchinson told investors at a financial
conference in New York.
    "Our borrower is struggling with high inflation and cost of
living, and now more recently, a weakening employment picture,"
Hutchinson said.
    Net charge-offs - or debts that are unlikely to be recovered
- in Ally's retail auto business were up about 10 basis points
in the same period compared to its expectations.
        

 (Reporting by Arasu Kannagi Basil in Bengaluru; Editing by
Janane Venkatraman)
 ((ArasuKannagi.Basil@thomsonreuters.com;))