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Ally Financial Swings to Profit for Third Quarter

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November 2, 2012 by   Comments Off on Ally Financial Swings to Profit for Third Quarter

Ally Financial Inc., the auto lender 74 percent-owned by the U.S. government, swung to a third-quarter profit, helped by its strong auto-lending and mortgage businesses.

Reuters reported that the Detroit-based lender said it earned $384 million in the quarter, compared with a loss of $210 million a year earlier. Ally entered the RV lending market in June of 2010.

The company’s mortgage operations, excluding Residential Capital, reported a pre-tax income of $354 million, compared to just $13 million a year ago.

The residential capital mortgage unit filed for Chapter 11 bankruptcy protection on May 14 to insulate the parent company from mortgage liabilities.

U.S. automotive earning assets rose 21% in the quarter and net financing revenue was up 22% in the United States.

Ally, previously known as GMAC Financial, was once the auto lending arm of what is now General Motors Co.

The company received $17 billion in bailouts from the U.S. government during the financial crisis and has been selling assets to repay the money.

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