Ally Financial Inc. · NYSE:ALLY
Ally Financial — General Motors Acceptance — Investor Presentation (January 2006)
40 slides from Ally Financial's investor presentation, Jan 20, 2006
Slide 1: 2006 Business Outlook
Sanjiv Khattri Executive Vice President & Chief Financial Officer January 20, 2006 2006 Business Outlook
Slide 2: GMAC Forward Looking Statements
GMAC Forward Looking Statements In the presentation that follows and in related comments by General Motors Acceptance Corporation management, our use of the words "expect", "anticipate", "estimate", "forecast", "objective", "plan", "goal", "project", "outlook", "priorities," "targets", "intend", "ev
Slide 3: Consolidated Net Income
Consolidated Net Income $ Millions
Slide 4: Consolidated Operating Earnings
Consolidated Operating Earnings $ Millions
Slide 5: Consolidated Operating Earnings and 2005 Dividends
Consolidated Operating Earnings $ Millions 2005 Dividends $2.5 Billion
Slide 6: 2005 Challenges
2005 Challenges Credit rating downgraded below investment grade Several additional GM / GMAC rating downgrades incurred GMAC borrowing spreads climbed to unprecedented levels Short-term interest rates ended upward Yield curve flattened
Slide 7: Earnings Mix - Business Diversification
Earnings Mix - Business Diversification 2001 2005 Estimate Financing Mortgage / Insurance * * Excluding goodwill impairment charges
Slide 8: Earnings Mix - Geographic Diversification
Earnings Mix - Geographic Diversification 2001 2005E CAGR Financing 192 400 20% Mortgage 72 190 27% Insurance 9 50 57% Total 273 640 24% $ Millions International Net Income* * Income outside U.S. and Canada ** Compound Annual Growth Rate **
Slide 9: Strategic Vision
Strategic Vision Leadership positions across all major sectors #1 in Auto Finance Top 10 player in Mortgage #1 provider of Extended Warranty #1 provider of Dealer Inventory Insurance Tremendous asset origination capability World-class servicing operations Well-managed risk profile Global franchise s
Slide 10: Strategic Vision
Strategic Vision Leadership positions across all major sectors Tremendous asset origination capability World-class servicing Well-managed risk profile Global franchise Create Premier Global Finance Company Business Strengths Achieved Business Strengths Lacking Investment grade rating Balance sheet c
Slide 11: Strategic Vision
Strategic Vision Leadership positions across all major sectors Tremendous asset origination capability World-class servicing Well-managed risk profile Global franchise Create Premier Global Finance Company Strategic Partner Strengths GMAC Business Strengths Investment grade rating Balance sheet capa
Slide 12: GMAC 2006 Mission
GMAC 2006 Mission With or without an investment grade rating, GMAC is well-positioned to carry out its dual mission this year Strategic mission Support GM vehicle sales with wholesale and retail auto financing Economic Mission Provide GM with a favorable return on its capital invested in GMAC
Slide 13: Business Outlook -- 2006
Business Outlook -- 2006 Financing Operations Mortgage Operations Insurance Operations
Slide 14: Business Outlook -- 2006: Insurance Operations
Business Outlook -- 2006 Financing Operations Mortgage Operations Insurance Operations Insurance Operations
Slide 15: Insurance Premium / Revenue
Insurance Premium / Revenue 2001 2002 2003 2004 2005E 2.7 3.6 3.9 4.1 4.2 International (%) 3.0 11.6 11.8 14.2 14.2 $ Billions Memo:
Slide 16: Insurance Business Lines - Competitive Advantages
Insurance Business Lines - Competitive Advantages Extended warranty Leverage GMAC's link to the manufacturer Dealer inventory insurance Leverage GMAC's deep and long-standing dealer relationships Bundling of insurance with floorplan financing Personal lines Niche marketing to affinity groups includi
Slide 17: Insurance Business Lines - Competitive Advantages
Insurance Business Lines - Competitive Advantages Extended warranty Leverage GMAC's link to the manufacturer Dealer inventory insurance Leverage GMAC's deep and long-standing dealer relationships Bundling of insurance with floorplan financing Personal lines Niche marketing to affinity groups includi
Slide 18: Insurance Operations
Insurance Operations Insurance Premium Growth Underwriting Performance Growth in International Markets Income From Investment Portfolio Operating Trends G G G G G G ($ Billions) 1/1/03 1/1/04 1/1/05 1/1/06E Market Value of Investment Portfolio $5.0 $6.2 $7.3 $7.7
Slide 19: Insurance Net Income
Insurance Net Income $ Millions
Slide 20: Business Outlook -- 2006
Business Outlook -- 2006 Financing Operations Mortgage Operations Insurance Operations
Slide 21: ResCap Net Income
ResCap Net Income Industry Volume* 2.2 2.8 3.8 2.7 2.7 ($ Trillions) * Source: Fannie Mae 2001 2002 2003 2004 2005E 152 319 912 904 904 $ Millions
Slide 22: U.S. Residential Mortgage Market: Industry Originations
2001 2002 2003 2004 2005E 2006E 2007E 2008E Net Income 2.2 2.8 3.8 2.7 2.7 2.2 2.2 2.2 $ Trillions Industry Originations U.S. Residential Mortgage Market Source: Fannie Mae
Slide 23: U.S. Residential Mortgage Market: Originations and Debt Outstanding
2001 2002 2003 2004 2005E 2006E 2007E 2008E Net Income 2.2 2.8 3.8 2.7 2.7 2.2 2.2 2.2 5.6 6.3 7.1 8.1 9 9.7 9.7 9.7 $ Trillions Industry Originations Mortgage Debt Outstanding $ Trillions U.S. Residential Mortgage Market Source: Fannie Mae
Slide 24: ResCap Stand-Alone Credit Rating
ResCap Stand-Alone Credit Rating GMAC ResCap Investment Grade Rating Firewall: Governance & Dividend Limitation Non-Investment Grade Rating 100% - owned
Slide 25: Business Outlook -- 2006
Business Outlook -- 2006 Financing Operations Mortgage Operations Insurance Operations
Slide 26: Financing Net Income
Financing Net Income 2001 2002 2003 2004 2005E 1254 1239 1360 1476 1300 $ Millions
Slide 27: Financing Operations -- 2006
Financing Operations -- 2006 Asset Base Net Margins Financing Net Income Capital Required RoE Decline Likely To Be Mitigated
Slide 28: U.S. Retail Credit Quality
U.S. Retail Credit Quality 1995 1996 1997 1998 1999 2000 2001 2002 2003 2004 2005E New 0.0109 0.0177 0.0156 0.0097 0.0067 0.0069 0.0083 0.0086 0.01 0.0091 0.0088 U.S. Net Charge-offs as % of Retail Managed Assets * Includes Retail and SmartBuy *
Slide 29: U.S. Retail / Lease Credit Quality
U.S. Retail / Lease Credit Quality 1995 1996 1997 1998 1999 2000 2001 2002 2003 2004 2005E 30-Day Delinquencies 0.0264 0.0296 0.03 0.0244 0.0202 0.0187 0.0207 0.0206 0.0201 0.0206 0.02 Repossessions 0.0275 0.0322 0.0285 0.0215 0.0177 0.0161 0.0182 0.0183 0.0178 0.0173 0.0166 (%) Frequency of Loss *
Slide 30: Sales Proceeds on Scheduled U.S. Lease Terminations
Sales Proceeds on Scheduled U.S. Lease Terminations Adjusted for Vehicle Mix 2000 2001 2002 2003 2004 2005E 36-Month Leases 13437 13558 13237 13313 14182 14392 Memo: Total SmartLease 460 580 738 611 465 287 Terminations (Units 000's)
Slide 31: GMAC Liquidity
GMAC FINANCIAL SERVICES GMAC LIQUIDITY
Slide 32: Strong Liquidity Position
Strong Liquidity Position Large cash balance maintained $20 billion* at year-end 2005 Cultivated large market for auto whole loan sales across the full credit spectrum Up to $64 billion of purchase commitments secured for the next five years Many other innovative funding channels established * Inclu
Slide 33: 2005 U.S. Term Funding
2005 U.S. Term Funding Secured Funding & Whole Loan Sales Unsecured Funding Secured Funding & Whole Loan Sales 0.9 0.1 $41 Billion Note: Represents domestic auto finance only
Slide 34: 2005 U.S. Term Funding
2005 U.S. Term Funding Money Market Investors Term Investors Whole Loans Unsecured Funding 0.42 0.13 0.35 0.1 $41 Billion Secured Funding & Whole Loan Sales (90%) (10%) Note: Represents domestic auto finance only
Slide 35: Consolidated Asset and Liability Maturities
Consolidated Asset and Liability Maturities Note: Includes cash, excludes on-balance sheet secured debt and the related assets, as of September 30, 2005
Slide 36: Summary
Summary GMAC continues to post strong earnings despite difficult challenges Business outlook for Financing, Insurance and Mortgage remains bright Major operating metrics trending favorably
Slide 37: Summary (cont.)
Summary (cont.) GMAC continues to maintain adequate liquidity position Funding needs being met through various forms of secured funding and whole loan sales In 2006, GMAC will seek to execute a business plan under which: GMAC would support GM vehicle sales with a broad range of auto financing activi
Slide 38: SmartNotes Website
SmartNotes Website WWW.SMARTNOTES.COM
Slide 39: Q&A
GMAC FINANCIAL SERVICES Q&A 8
Slide 40: GMAC Financial Services
GMAC FINANCIAL SERVICES
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