ALLY FINANCIAL INC., 10-Q filed on 8/2/2021
Quarterly Report
v3.21.2
Cover Page - shares
6 Months Ended
Jun. 30, 2021
Jul. 29, 2021
Entity Information [Line Items]    
Document Type 10-Q  
Document Quarterly Report true  
Document Period End Date Jun. 30, 2021  
Document Transition Report false  
Entity File Number 1-3754  
Entity Registrant Name Ally Financial Inc.  
Entity Incorporation, State or Country Code DE  
Entity Tax Identification Number 38-0572512  
Entity Address, Address Description Ally Detroit Center  
Entity Address, Address Line One 500 Woodward Avenue  
Entity Address, Address Line Two Floor 10  
Entity Address, City or Town Detroit  
Entity Address, State or Province MI  
Entity Address, Postal Zip Code 48226  
City Area Code 866  
Local Phone Number 710-4623  
Entity Current Reporting Status Yes  
Entity Interactive Data Current Yes  
Entity Filer Category Large Accelerated Filer  
Entity Small Business false  
Entity Emerging Growth Company false  
Entity Shell Company false  
Entity Common Stock, Shares Outstanding   360,541,736
Entity Central Index Key 0000040729  
Current Fiscal Year End Date --12-31  
Document Fiscal Year Focus 2021  
Document Fiscal Period Focus Q2  
Amendment Flag false  
Common stock    
Entity Information [Line Items]    
Title of 12(b) Security Common Stock, par value $0.01 per share  
Trading Symbol ALLY  
Security Exchange Name NYSE  
Trust Preferred Securities Subject to Mandatory Redemption    
Entity Information [Line Items]    
Title of 12(b) Security 8.125% Fixed Rate/Floating Rate Trust Preferred Securities, Series 2 of GMAC Capital Trust I  
Trading Symbol ALLY PRA  
Security Exchange Name NYSE  
v3.21.2
Condensed Consolidated Statement of Comprehensive Income (unaudited) - USD ($)
$ in Millions
3 Months Ended 6 Months Ended
Jun. 30, 2021
Jun. 30, 2020
Jun. 30, 2021
Jun. 30, 2020
Financing revenue and other interest income        
Interest and fees on finance receivables and loans $ 1,588 $ 1,630 $ 3,170 $ 3,372
Interest on loans held-for-sale 4 4 9 6
Interest and dividends on investment securities and other earning assets 147 197 278 423
Interest on cash and cash equivalents 4 4 8 18
Operating leases 384 343 754 710
Total financing revenue and other interest income 2,127 2,178 4,219 4,529
Interest expense        
Interest on deposits 268 541 574 1,133
Interest on short-term borrowings 0 13 1 30
Interest on long-term debt 230 318 480 666
Total interest expense 498 872 1,055 1,829
Net depreciation expense on operating lease assets 82 252 245 500
Net financing revenue and other interest income 1,547 1,054 2,919 2,200
Other revenue        
Insurance premiums and service revenue earned 278 263 558 540
Gain on mortgage and automotive loans, net 19 14 55 2
Loss on extinguishment of debt (73) (1) (74) (1)
Other gain on investments, net 65 188 188 109
Other income, net of losses 249 91 376 171
Total other revenue 538 555 1,103 821
Total net revenue 2,085 1,609 4,022 3,021
Provision for credit losses (32) 287 (45) 1,190
Noninterest expense        
Compensation and benefits expense 446 334 841 694
Insurance losses and loss adjustment expenses 74 142 137 216
Goodwill impairment 0 50 0 50
Other operating expenses 555 459 1,040 945
Total noninterest expense 1,075 985 2,018 1,905
Income (loss) from continuing operations before income tax expense 1,042 337 2,049 (74)
Income tax expense from continuing operations 143 95 354 3
Net income (loss) from continuing operations 899 242 1,695 (77)
Income (loss) from discontinued operations, net of tax 1 (1) 1 (1)
Net income (loss) 900 241 1,696 (78)
Other comprehensive income (loss), net of tax 189 109 (415) 692
Comprehensive income $ 1,089 $ 350 $ 1,281 $ 614
Basic earnings per common share        
Net income (loss) from continuing operations (in dollars per share) [1] $ 2.43 $ 0.65 $ 4.55 $ (0.20)
Net income (loss) (in dollars per share) [1] 2.43 0.64 4.55 (0.21)
Diluted earnings per common share        
Net income (loss) from continuing operations (in dollars per share) [1],[2] 2.41 0.64 4.52 (0.20)
Net income (loss) (in dollars per share) [1],[2] 2.41 0.64 4.52 (0.21)
Cash dividends declared per common share (in dollars per share) [1],[2] $ 0.19 $ 0.19 $ 0.38 $ 0.38
[1] Figures in the table may not recalculate exactly due to rounding. Earnings per share is calculated based on unrounded numbers.
[2] Due to the antidilutive effect of the net loss from continuing operations for the six months ended June 30, 2020, basic weighted-average common shares outstanding was used to calculate basic and diluted earnings per share.
v3.21.2
Condensed Consolidated Balance Sheet (unaudited) - USD ($)
$ in Millions
Jun. 30, 2021
Dec. 31, 2020
Cash and cash equivalents    
Noninterest-bearing $ 653 $ 724
Interest-bearing 13,011 14,897
Total cash and cash equivalents 13,664 15,621
Equity securities 1,026 1,071
Available-for-sale securities (amortized cost of $33,781 and $28,936) [1] 34,161 29,830
Held-to-maturity securities (fair value of $1,173 and $1,331) 1,126 1,253
Loans held-for-sale, net 409 406
Finance receivables and loans, net    
Finance receivables and loans, net of unearned income 112,217 118,534
Allowance for loan losses (3,126) (3,283)
Total finance receivables and loans, net 109,091 115,251
Investment in operating leases, net 10,715 9,639
Premiums receivable and other insurance assets 2,773 2,679
Other assets 7,505 6,415
Total assets 180,470 182,165
Deposit liabilities    
Noninterest-bearing 149 128
Interest-bearing 138,955 136,908
Total deposit liabilities 139,104 137,036
Short-term borrowings 0 2,136
Long-term debt 16,896 22,006
Interest payable 365 412
Unearned insurance premiums and service revenue 3,536 3,438
Accrued expenses and other liabilities 3,039 2,434
Total liabilities 162,940 167,462
Contingencies (refer to Note 23)
Equity    
Common stock and paid-in capital ($0.01 par value, shares authorized 1,100,000,000; issued 504,118,452 and 501,237,055; and outstanding 362,638,597 and 374,674,415) 21,631 21,544
Preferred stock 2,324 0
Accumulated deficit (2,726) (4,278)
Accumulated other comprehensive income 216 631
Treasury stock, at cost (141,479,855 and 126,562,640 shares) (3,915) (3,194)
Total equity 17,530 14,703
Total liabilities and equity 180,470 182,165
On-balance sheet variable interest entities    
Finance receivables and loans, net    
Allowance for loan losses (252) (285)
Total finance receivables and loans, net 9,117 13,213
Other assets 761 983
Total assets 9,878 14,196
Deposit liabilities    
Long-term debt 1,847 4,158
Accrued expenses and other liabilities 3 3
Total liabilities 1,850 4,161
On-balance sheet variable interest entities | Consumer    
Finance receivables and loans, net    
Finance receivables and loans, net of unearned income 7,232 7,630
On-balance sheet variable interest entities | Commercial    
Finance receivables and loans, net    
Finance receivables and loans, net of unearned income $ 2,137 $ 5,868
[1] Refer to Note 6 for discussion of investment securities pledged as collateral.
v3.21.2
Condensed Consolidated Balance Sheet (unaudited) (Parenthetical) - USD ($)
$ in Millions
Jun. 30, 2021
Dec. 31, 2020
Common stock, par value per share (in dollars per share) $ 0.01 $ 0.01
Common stock, shares authorized (in shares) 1,100,000,000 1,100,000,000
Common stock, shares issued (in shares) 504,118,452 501,237,055
Common stock, shares outstanding (in shares) 362,638,597 374,674,415
Treasury stock, shares (in shares) 141,479,855 126,562,640
Available-for-sale debt securities | Available-for-sale securities    
Debt securities, available-for-sale, amortized cost $ 33,781 $ 28,936
Held-to-maturity securities    
Held-to-maturity securities, fair value 1,173 1,331
Held-to-maturity securities | Held-to-maturity securities    
Held-to-maturity securities, fair value $ 1,173 $ 1,331
v3.21.2
Condensed Consolidated Statement of Changes in Equity (unaudited) - USD ($)
$ in Millions
Total
Series B Preferred Stock
Series C Preferred Stock
Cumulative Effect, Period of Adoption, Adjustment
Cumulative Effect, Period of Adoption, Adjusted Balance
Common stock and paid-in capital
Common stock and paid-in capital
Cumulative Effect, Period of Adoption, Adjusted Balance
Preferred stock
Preferred stock
Series B Preferred Stock
Preferred stock
Series C Preferred Stock
Preferred stock
Cumulative Effect, Period of Adoption, Adjusted Balance
Accumulated deficit
Accumulated deficit
Cumulative Effect, Period of Adoption, Adjustment
Accumulated deficit
Cumulative Effect, Period of Adoption, Adjusted Balance
Accumulated other comprehensive income
Accumulated other comprehensive income
Cumulative Effect, Period of Adoption, Adjusted Balance
Treasury stock
Treasury stock
Cumulative Effect, Period of Adoption, Adjusted Balance
Increase (Decrease) in Stockholders' Equity [Roll Forward]                                    
Adoption of Accounting Standards Update 2016-13 $ 14,416     $ (1,017) $ 13,399 $ 21,438 $ 21,438 $ 0     $ 0 $ (4,057) $ (1,017) $ (5,074) $ 123 $ 123 $ (3,088) $ (3,088)
Beginning balance at Dec. 31, 2019 14,416     $ (1,017) $ 13,399 21,438 $ 21,438 0     $ 0 (4,057) $ (1,017) $ (5,074) 123 $ 123 (3,088) $ (3,088)
Increase (Decrease) in Stockholders' Equity [Roll Forward]                                    
Net income (loss) (78)                     (78)            
Share-based compensation 61         61                        
Other comprehensive income (loss) 692                           692      
Common stock repurchases (104)                               (104)  
Common stock dividends (144)                     (144)            
Ending balance at Jun. 30, 2020 13,826         21,499   0       (5,296)     815   (3,192)  
Increase (Decrease) in Stockholders' Equity [Roll Forward]                                    
Adoption of Accounting Standards Update 2016-13 13,519         21,470   0       (5,465)     706   (3,192)  
Beginning balance at Mar. 31, 2020 13,519         21,470   0       (5,465)     706   (3,192)  
Increase (Decrease) in Stockholders' Equity [Roll Forward]                                    
Net income (loss) 241                     241            
Share-based compensation 29         29                        
Other comprehensive income (loss) 109                           109      
Common stock dividends (72)                     (72)            
Ending balance at Jun. 30, 2020 13,826         21,499   0       (5,296)     815   (3,192)  
Increase (Decrease) in Stockholders' Equity [Roll Forward]                                    
Adoption of Accounting Standards Update 2016-13 13,826         21,499   0       (5,296)     815   (3,192)  
Adoption of Accounting Standards Update 2016-13 14,703         21,544           (4,278)     631   (3,194)  
Beginning balance at Dec. 31, 2020 14,703         21,544           (4,278)     631   (3,194)  
Increase (Decrease) in Stockholders' Equity [Roll Forward]                                    
Net income (loss) 1,696                     1,696            
Net proceeds from issuance of series preferred stock   $ 1,335 $ 989           $ 1,335 $ 989                
Share-based compensation 87         87                        
Other comprehensive income (loss) (415)                           (415)      
Common stock repurchases (721)                               (721)  
Common stock dividends (144)                     (144)            
Ending balance at Jun. 30, 2021 17,530         21,631   2,324       (2,726)     216   (3,915)  
Increase (Decrease) in Stockholders' Equity [Roll Forward]                                    
Adoption of Accounting Standards Update 2016-13 14,625         21,566   0       (3,555)     27   (3,413)  
Beginning balance at Mar. 31, 2021 14,625         21,566   0       (3,555)     27   (3,413)  
Increase (Decrease) in Stockholders' Equity [Roll Forward]                                    
Net income (loss) 900                     900            
Net proceeds from issuance of series preferred stock   $ 1,335 $ 989           $ 1,335 $ 989                
Share-based compensation 65         65                        
Other comprehensive income (loss) 189                           189      
Common stock repurchases (502)                               (502)  
Common stock dividends (71)                     (71)            
Ending balance at Jun. 30, 2021 17,530         21,631   2,324       (2,726)     216   (3,915)  
Increase (Decrease) in Stockholders' Equity [Roll Forward]                                    
Adoption of Accounting Standards Update 2016-13 $ 17,530         $ 21,631   $ 2,324       $ (2,726)     $ 216   $ (3,915)  
v3.21.2
Condensed Consolidated Statement of Changes in Equity (unaudited) (Parenthetical) - $ / shares
3 Months Ended 6 Months Ended
Jun. 30, 2021
Jun. 30, 2020
Jun. 30, 2021
Jun. 30, 2020
Statement of Stockholders' Equity [Abstract]        
Cash dividends declared per common share (in dollars per share) [1],[2] $ 0.19 $ 0.19 $ 0.38 $ 0.38
[1] Due to the antidilutive effect of the net loss from continuing operations for the six months ended June 30, 2020, basic weighted-average common shares outstanding was used to calculate basic and diluted earnings per share.
[2] Figures in the table may not recalculate exactly due to rounding. Earnings per share is calculated based on unrounded numbers.
v3.21.2
Condensed Consolidated Statement of Cash Flows (unaudited) - USD ($)
$ in Millions
6 Months Ended
Jun. 30, 2021
Jun. 30, 2020
Operating activities    
Net income (loss) $ 1,696 $ (78)
Reconciliation of net income (loss) to net cash provided by operating activities    
Depreciation and amortization 640 802
Goodwill impairment 0 50
Provision for credit losses (45) 1,190
Gain on mortgage and automotive loans, net (55) (2)
Other gain on investments, net (188) (109)
Loss on extinguishment of debt 74 1
Originations and purchases of loans held-for-sale (2,154) (1,329)
Proceeds from sales and repayments of loans held-for-sale 2,230 1,167
Net change in    
Deferred income taxes (675) 0
Interest payable (48) 56
Other assets 2 (420)
Other liabilities 231 (211)
Other, net (86) 45
Net cash provided by operating activities 1,622 1,162
Investing activities    
Purchases of equity securities (724) (740)
Proceeds from sales of equity securities 944 774
Purchases of available-for-sale securities (14,376) (7,696)
Proceeds from sales of available-for-sale securities 2,788 5,544
Proceeds from repayments of available-for-sale securities 6,539 4,440
Purchases of held-to-maturity securities (97) 0
Proceeds from repayments of held-to-maturity securities 223 177
Purchases of finance receivables and loans held-for-investment (3,500) (3,495)
Proceeds from sales of finance receivables and loans initially held-for-investment 376 1
Originations and repayments of finance receivables and loans held-for-investment and other, net 9,095 13,135
Purchases of operating lease assets (3,026) (1,949)
Disposals of operating lease assets 1,775 1,179
Net change in nonmarketable equity investments 93 148
Other, net (201) (213)
Net cash (used in) provided by investing activities (91) 11,305
Financing activities    
Net change in short-term borrowings (2,136) (1,842)
Net increase in deposits 2,060 10,272
Proceeds from issuance of long-term debt 194 2,372
Repayments of long-term debt (3,800) (7,434)
Repurchases of common stock (721) (104)
Preferred stock issuance 2,326 0
Trust preferred securities redemption (1,442) 0
Dividends paid (144) (144)
Net cash (used in) provided by financing activities (3,663) 3,120
Effect of exchange-rate changes on cash and cash equivalents and restricted cash 3 (3)
Net (decrease) increase in cash and cash equivalents and restricted cash (2,129) 15,584
Cash and cash equivalents and restricted cash at beginning of year 16,574 4,380
Cash and cash equivalents and restricted cash at June 30, 14,445 19,964
Supplemental disclosures    
Interest 1,057 1,722
Income taxes 1,212 7
Loans held-for-sale transferred to finance receivables and loans held-for-investment 5 70
Additions of property and equipment 46 0
Finance receivables and loans held-for-investment transferred to loans held-for-sale 414 0
In-kind distribution from equity-method investee 0 60
Equity consideration received in exchange for restructured loans 0 5
Additional Cash Flow Elements and Supplemental Cash Flow Information [Abstract]    
Cash and cash equivalents on the Condensed Consolidated Balance Sheet 13,664 19,131
Restricted cash included in other assets on the Condensed Consolidated Balance Sheet [1] 781 833
Total cash and cash equivalents and restricted cash in the Condensed Consolidated Statement of Cash Flows $ 14,445 $ 19,964
[1] Restricted cash balances relate primarily to Ally securitization arrangements. Refer to Note 10 for additional details describing the nature of restricted cash balances.
v3.21.2
Description of Business, Basis of Presentation, and Changes in Significant Accounting Policies
6 Months Ended
Jun. 30, 2021
Organization, Consolidation and Presentation of Financial Statements [Abstract]  
Description of Business, Basis of Presentation, and Changes in Significant Accounting Policies Description of Business, Basis of Presentation, and Changes in Significant Accounting Policies
Ally Financial Inc. (together with its consolidated subsidiaries unless the context otherwise requires, Ally, the Company, we, us, or our) is a digital financial-services company committed to its promise to “Do It Right” for its consumer, commercial, and corporate customers. Ally is composed of an industry-leading independent automotive finance and insurance operation, an award-winning digital direct bank (Ally Bank, Member FDIC and Equal Housing Lender, which offers mortgage lending, point-of-sale personal lending, and a variety of deposit and other banking products), a corporate finance business for equity sponsors and middle-market companies, and securities brokerage and investment advisory services. A relentless ally for all things money, Ally helps people save well and earn well, so they can spend for what matters. We are a Delaware corporation and are registered as a BHC under the BHC Act, and an FHC under the GLB Act.
Our accounting and reporting policies conform to U.S. GAAP. Additionally, where applicable, the policies conform to the accounting and reporting guidelines prescribed by bank regulatory authorities. Certain reclassifications may have been made to the prior periods’ financial statements and notes to conform to the current period’s presentation, which did not have a material impact on our Condensed Consolidated Financial Statements. The preparation of financial statements in conformity with GAAP requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities and disclosure of contingent assets and liabilities at the date of the financial statements and that affect income and expenses during the reporting period and related disclosures. In developing the estimates and assumptions, management uses all available evidence; however, actual results could differ because of uncertainties associated with estimating the amounts, timing, and likelihood of possible outcomes. Our most significant estimates pertain to the allowance for loan losses, valuations of automotive lease assets and residuals, fair value of financial instruments, and the determination of the provision for income taxes.
The Condensed Consolidated Financial Statements at June 30, 2021, and for the three months and six months ended June 30, 2021, and 2020, are unaudited but reflect all adjustments that are, in management’s opinion, necessary for the fair presentation of the results for the interim periods presented. All such adjustments are of a normal recurring nature. These unaudited Condensed Consolidated Financial Statements should be read in conjunction with the audited Consolidated Financial Statements (and the related Notes) included in our Annual Report on Form 10-K for the year ended December 31, 2020, as filed on February 24, 2021, with the SEC.
Significant Accounting Policies
Income Taxes
In calculating the provision for interim income taxes, in accordance with ASC 740, Income Taxes, we apply an estimated annual effective tax rate to year-to-date ordinary income. At the end of each interim period, we estimate the effective tax rate expected to be applicable for the full fiscal year. This method differs from that described in Note 1 to the Consolidated Financial Statements in our 2020 Annual Report on Form 10-K, which describes our annual significant income tax accounting policy and related methodology.
Refer to Note 1 to the Consolidated Financial Statements in our 2020 Annual Report on Form 10-K regarding additional significant accounting policies.
Recently Adopted Accounting Standards
Reference Rate Reform (ASU 2021-01)
In January 2021, the FASB issued ASU 2021-01, Reference Rate Reform (Topic 848): Scope, which clarified the scope of ASU 2020-04, Reference Rate Reform: Facilitation of the Effects of Reference Rate Reform on Financial Reporting, indicating that certain optional expedients and exceptions included in ASU 2020-04 are applicable to derivative instruments affected by the market-wide change in interest rates used for discounting, margining, or contract price alignment. We adopted the amendments in this ASU immediately upon issuance in January 2021 on a prospective basis and will apply this guidance, along with the guidance from ASU 2020-04, as contracts are modified through December 2022. The adoption did not have an immediate direct impact on our financial statements. We do not expect there to be a material impact to our financial statements.
v3.21.2
Revenue from Contracts with Customers
6 Months Ended
Jun. 30, 2021
Revenue from Contract with Customer [Abstract]  
Revenue from Contracts with Customers Revenue from Contracts with Customers
Our primary revenue sources, which include financing revenue and other interest income, are addressed by other GAAP and are not in the scope of ASC Topic 606, Revenue from Contracts with Customers. As part of our Insurance operations, we recognize revenue from insurance contracts, which are addressed by other GAAP and are not included in the scope of this standard. Certain noninsurance contracts within our Insurance operations, including VSCs, GAP contracts, and VMCs, are included in the scope of this standard. All revenue associated with noninsurance contracts is recognized over the contract term on a basis proportionate to the anticipated cost emergence. Further, commissions and sales expense incurred to obtain these contracts are amortized over the terms of the related policies and service contracts on the same basis as premiums and service revenue are earned, and all advertising costs are recognized as expense when incurred.
The following tables present a disaggregated view of our revenue from contracts with customers. For further information regarding our revenue recognition policies and details about the nature of our respective revenue streams, refer to Note 1 and Note 3 to the Consolidated Financial Statements in our 2020 Annual Report on Form 10-K.
Three months ended June 30, ($ in millions)
Automotive Finance operationsInsurance operationsMortgage Finance operationsCorporate Finance operationsCorporate and OtherConsolidated
2021
Revenue from contracts with customers
Noninsurance contracts (a) (b) (c)$ $158 $ $ $ $158 
Remarketing fee income27     27 
Brokerage commissions and other revenue    13 13 
Deposit account and other banking fees (d)    5 5 
Brokered/agent commissions 4    4 
Other6    2 8 
Total revenue from contracts with customers
33 162   20 215 
All other revenue
28 182 22 33 58 323 
Total other revenue (e)$61 $344 $22 $33 $78 $538 
2020
Revenue from contracts with customers
Noninsurance contracts (a) (b) (c)$— $142 $— $— $— $142 
Remarketing fee income15 — — — — 15 
Brokerage commissions and other revenue— — — — 14 14 
Deposit account and other banking fees (d)— — — — 
Brokered/agent commissions— — — — 
Other— — — — 
Total revenue from contracts with customers
18 146 — — 15 179 
All other revenue22 292 19 37 376 
Total other revenue (e)$40 $438 $19 $$52 $555 
(a)We had opening balances of $3.0 billion and $2.9 billion in unearned revenue associated with outstanding contracts at April 1, 2021, and April 1, 2020, respectively, and $228 million and $211 million of these balances were recognized as insurance premiums and service revenue earned in our Condensed Consolidated Statement of Comprehensive Income during the three months ended June 30, 2021, and June 30, 2020, respectively.
(b)At June 30, 2021, we had unearned revenue of $3.1 billion associated with outstanding contracts, and with respect to this balance we expect to recognize revenue of $423 million during the remainder of 2021, $789 million in 2022, $700 million in 2023, $531 million in 2024, and $628 million thereafter. At June 30, 2020, we had unearned revenue of $2.9 billion associated with outstanding contracts.
(c)We had deferred insurance assets of $1.8 billion and $1.9 billion at April 1, 2021, and June 30, 2021, respectively, and recognized $133 million of expense during the three months ended June 30, 2021. We had deferred insurance assets of $1.7 billion and $1.8 billion at April 1, 2020, and June 30, 2020, respectively, and recognized $121 million of expense during the three months ended June 30, 2020.
(d)Reflects various services fees we charge depositors. Effective May 25, 2021, we eliminated all overdraft fees for Ally Bank deposit accounts.
(e)Represents a component of total net revenue. Refer to Note 22 for further information on our reportable operating segments.
Six months ended June 30, ($ in millions)
Automotive Finance operationsInsurance operationsMortgage Finance operationsCorporate Finance operationsCorporate and OtherConsolidated
2021
Revenue from contracts with customers
Noninsurance contracts (a) (b)$ $313 $ $ $ $313 
Remarketing fee income54     54 
Brokerage commissions and other revenue    33 33 
Deposit account and other banking fees (c)    11 11 
Brokered/agent commissions 8    8 
Other12    2 14 
Total revenue from contracts with customers
66 321   46 433 
All other revenue
57 402 62 59 90 670 
Total other revenue (d)$123 $723 $62 $59 $136 $1,103 
2020
Revenue from contracts with customers
Noninsurance contracts (a) (b)$— $285 $— $— $— $285 
Remarketing fee income32 — — — — 32 
Brokerage commissions and other revenue— — — — 27 27 
Deposit account and other banking fees (c)— — — — 
Brokered/agent commissions— — — — 
Other— — — — 
Total revenue from contracts with customers
40 293 — — 32 365 
All other revenue47 282 29 19 79 456 
Total other revenue (d)$87 $575 $29 $19 $111 $821 
(a)We had opening balances of $3.0 billion and $2.9 billion in unearned revenue associated with outstanding contracts at January 1, 2021, and January 1, 2020, respectively, and $453 million and $425 million of these balances were recognized as insurance premiums and service revenue earned in our Condensed Consolidated Statement of Comprehensive Income during the six months ended June 30, 2021, and June 30, 2020.
(b)We had deferred insurance assets of $1.8 billion and $1.9 billion at January 1, 2021, and June 30, 2021, respectively, and recognized $265 million of expense during the six months ended June 30, 2021. We had deferred insurance assets of $1.7 billion and $1.8 billion at January 1, 2020, and June 30, 2020, respectively, and recognized $246 million of expense during the six months ended June 30, 2020.
(c)Reflects various services fees we charge depositors. Effective May 25, 2021, we eliminated all overdraft fees for Ally Bank deposit accounts.
(d)Represents a component of total net revenue. Refer to Note 22 for further information on our reportable operating segments.
In addition to the components of other revenue presented above, as part of our Automotive Finance operations, we recognized net remarketing gains of $128 million and $192 million for the three months and six months ended June 30, 2021, respectively, and net remarketing losses of $11 million and $9 million for the three months and six months ended June 30, 2020, respectively, on the sale of off-lease vehicles. These gains and losses are included in depreciation expense on operating lease assets in our Condensed Consolidated Statement of Comprehensive Income.
v3.21.2
Other Income, Net of Losses
6 Months Ended
Jun. 30, 2021
Other Nonoperating Income (Expense) [Abstract]  
Other Income, Net of Losses Other Income, Net of Losses
Details of other income, net of losses, were as follows.
Three months ended June 30,Six months ended June 30,
($ in millions)2021202020212020
Gain (loss) on nonmarketable equity investments, net$99 $(4)$103 $(4)
Late charges and other administrative fees29 16 60 37 
Remarketing fees27 15 54 32 
Income from equity-method investments31 53 45 52 
Other, net63 11 114 54 
Total other income, net of losses$249 $91 $376 $171 
v3.21.2
Reserves for Insurance Losses and Loss Adjustment Expenses
6 Months Ended
Jun. 30, 2021
Short-duration Insurance Contracts, Liability for Unpaid Claims and Allocated Claim Adjustment Expense, Net [Abstract]  
Reserves for Insurance Losses and Loss Adjustment Expenses Reserves for Insurance Losses and Loss Adjustment Expenses
The following table shows a rollforward of our reserves for insurance losses and loss adjustment expenses.
($ in millions)20212020
Total gross reserves for insurance losses and loss adjustment expenses at January 1,$129 $122 
Less: Reinsurance recoverable90 88 
Net reserves for insurance losses and loss adjustment expenses at January 1,39 34 
Net insurance losses and loss adjustment expenses incurred related to:
Current year136 215 
Prior years (a)1 
Total net insurance losses and loss adjustment expenses incurred137 216 
Net insurance losses and loss adjustment expenses paid or payable related to:
Current year(108)(178)
Prior years(27)(26)
Total net insurance losses and loss adjustment expenses paid or payable(135)(204)
Net reserves for insurance losses and loss adjustment expenses at June 30,41 46 
Plus: Reinsurance recoverable85 86 
Total gross reserves for insurance losses and loss adjustment expenses at June 30,$126 $132 
(a)There have been no material adverse changes to the reserve for prior years.
v3.21.2
Other Operating Expenses
6 Months Ended
Jun. 30, 2021
Operating Expenses [Abstract]  
Other Operating Expenses Other Operating Expenses
Details of other operating expenses were as follows.
Three months ended June 30,Six months ended June 30,
($ in millions)2021202020212020
Insurance commissions$138 $127 $274 $253 
Technology and communications81 80 159 159 
Lease and loan administration57 46 112 84 
Advertising and marketing45 32 86 76 
Property and equipment depreciation38 34 74 68 
Professional services28 28 61 59 
Charitable contributions54 55 
Vehicle remarketing and repossession17 11 38 34 
Regulatory and licensing fees17 29 35 58 
Occupancy18 13 33 29 
Non-income taxes9 15 14 
Amortization of intangible assets4 9 10 
Other49 44 89 97 
Total other operating expenses$555 $459 $1,040 $945 
v3.21.2
Investment Securities
6 Months Ended
Jun. 30, 2021
Investments, Debt and Equity Securities [Abstract]  
Investment Securities Investment Securities
Our investment portfolio includes various debt and equity securities. Our debt securities, which are classified as available-for-sale or held-to-maturity, include government securities, corporate bonds, asset-backed securities, and mortgage-backed securities. The cost, fair value, and gross unrealized gains and losses on available-for-sale and held-to-maturity securities were as follows.
June 30, 2021December 31, 2020
Amortized costGross unrealized
Fair value
Amortized costGross unrealized
Fair value
($ in millions)gainslossesgainslosses
Available-for-sale securities
Debt securities
U.S. Treasury and federal agencies$2,153 $12 $(17)$2,148 $783 $20 $— $803 
U.S. States and political subdivisions989 37 (2)1,024 1,046 50 (1)1,095 
Foreign government181 4 (1)184 167 — 176 
Agency mortgage-backed residential
20,615 343 (123)20,835 18,053 538 (3)18,588 
Mortgage-backed residential2,890 25 (5)2,910 2,595 49 (4)2,640 
Agency mortgage-backed commercial4,355 109 (59)4,405 4,063 139 (13)4,189 
Asset-backed552 3  555 420 — 425 
Corporate debt2,046 63 (9)2,100 1,809 105 — 1,914 
Total available-for-sale securities (a) (b) (c) (d) (e)
$33,781 $596 $(216)$34,161 $28,936 $915 $(21)$29,830 
Held-to-maturity securities
Debt securities
Agency mortgage-backed residential$1,126 $57 $(10)$1,173 $1,253 $79 $(1)$1,331 
Total held-to-maturity securities (e) (f)$1,126 $57 $(10)$1,173 $1,253 $79 $(1)$1,331 
(a)Certain entities related to our Insurance operations are required to deposit securities with state regulatory authorities. These deposited securities totaled $13 million at both June 30, 2021, and December 31, 2020.
(b)Certain available-for-sale securities are included in fair value hedging relationships. Refer to Note 18 for additional information.
(c)Available-for-sale securities with a fair value of $151 million and $145 million at June 30, 2021, and December 31, 2020, respectively, were pledged for purposes as required by contractual obligation or law. Under these agreements, we granted the counterparty the right to sell or pledge the underlying investment securities.
(d)Totals do not include accrued interest receivable, which was $90 million at both June 30, 2021, and December 31, 2020. Accrued interest receivable is included in other assets on our Condensed Consolidated Balance Sheet.
(e)There was no allowance for credit losses recorded at June 30, 2021, or December 31, 2020, as management determined that there were no expected credit losses in our portfolio of available-for-sale and held-to-maturity securities.
(f)Totals do not include accrued interest receivable, which was $3 million at both June 30, 2021, and December 31, 2020. Accrued interest receivable is included in other assets on our Condensed Consolidated Balance Sheet.
The maturity distribution of debt securities outstanding is summarized in the following tables based upon contractual maturities. Call or prepayment options may cause actual maturities to differ from contractual maturities.
TotalDue in one year or lessDue after one year through five yearsDue after five years through ten yearsDue after ten years
($ in millions)AmountYieldAmountYieldAmountYieldAmountYieldAmountYield
June 30, 2021
Fair value of available-for-sale securities (a)
U.S. Treasury and federal agencies$2,148 1.1 %$12 1.6 %$510 0.9 %$1,626 1.2 %$  %
U.S. States and political subdivisions1,024 3.0 51 2.5 102 2.4 212 2.7 659 3.2 
Foreign government184 1.9 13 2.1 106 2.0 65 1.8   
Agency mortgage-backed residential20,835 2.6     31 2.0 20,804 2.6 
Mortgage-backed residential2,910 2.8     28 2.9 2,882 2.8 
Agency mortgage-backed commercial4,405 1.9     1,753 2.3 2,652 1.7 
Asset-backed555 2.1   350 2.5 194 1.4 11 3.2 
Corporate debt2,100 2.4 103 2.7 849 2.4 1,147 2.4 1 1.7 
Total available-for-sale securities$34,161 2.4 $179 2.5 $1,917 2.0 $5,056 1.9 $27,009 2.5 
Amortized cost of available-for-sale securities
$33,781 $178 $1,874 $4,945 $26,784 
Amortized cost of held-to-maturity securities
Agency mortgage-backed residential$1,126 2.9 %$  %$  %$  %$1,126 2.9 %
Total held-to-maturity securities
$1,126 2.9 $  $  $  $1,126 2.9 
December 31, 2020
Fair value of available-for-sale securities (a)
U.S. Treasury and federal agencies$803 1.2 %$13 0.1 %$708 1.1 %$82 1.7 %$— — %
U.S. States and political subdivisions1,095 3.0 49 1.4 103 2.3 228 2.7 715 3.3 
Foreign government176 2.1 1.7 86 2.3 81 1.9 — — 
Agency mortgage-backed residential18,588 3.1 — — — — 37 2.0 18,551 3.1 
Mortgage-backed residential2,640 3.1 — — — — 36 2.9 2,604 3.1 
Agency mortgage-backed commercial4,189 1.9 — — — — 1,628 2.3 2,561 1.7 
Asset-backed425 2.9 — — 349 3.0 49 1.8 27 3.1 
Corporate debt1,914 2.7 155 2.7 625 2.9 1,077 2.6 57 2.1 
Total available-for-sale securities$29,830 2.8 $226 2.3 $1,871 2.2 $3,218 2.4 $24,515 3.0 
Amortized cost of available-for-sale securities
$28,936 $224 $1,808 $3,022 $23,882 
Amortized cost of held-to-maturity securities
Agency mortgage-backed residential
$1,253 3.0 %$— — %$— — %$— — %$1,253 3.0 %
Total held-to-maturity securities
$1,253 3.0 $— — $— — $—