Ally Financial reported its first-quarter net income fell 51% compared to the first quarter of 2022.
Even so, its $319 million in net income was an improvement over the fourth quarter.
Ally took the biggest hit in its auto lending business, its primary source of income, which recorded a significant drop year-over-year.
Pretax auto finance income fell 39% to $442 million. Ally attributed the decline to historically low net auto losses a year ago.
Ally reported its pretax auto finance income rose 1.1% compared with the fourth quarter.
"Ally's operating results amid this dynamic macro environment highlight the continued strength of our franchises," Ally CEO Jeffrey Brown said in a press release. "Despite the heightened volatility in markets, the team remained focused on what we can control and delivered another quarter of compelling operational results."
Ally reported writing $9.5 billion worth of auto loans and leases in the first quarter, down 18% from the same period in 2022. The company noted it had received 3.3 million applications for financing, compared to 3.2 million decisioned applications in the same quarter in 2022.
The company reported being more selective with approvals in this year's first quarter, approving 31% of customers compared to 34% in the first quarter of 2022.
But Brown stressed while discussing Ally's auto results on an earnings call, "Consumer demand remains strong."
Ally reported its provision for loan losses more than doubled in the quarter, growing to $446 million. The company reported credit is normalizing from historical lows and factors in a "modest reserve build to reflect the evolving macro environment."
Originally posted on Auto Dealer Today