Ally Financial Inc. · NYSE:ALLY
Ally Financial — General Motors Acceptance — Debt Investor Presentation (October 2005)
43 slides from Ally Financial's debt investor presentation, Oct 24, 2005
Slide 1: General Motors Acceptance Corp. Madrid / Paris
General Motors Acceptance Corp. Madrid / Paris October 24-25, 2005 Sanjiv Khattri - EVP & CFO
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: General Motors Corporation
GM General Motors Corporation
Slide 4: 2005 Third Quarter Highlights
2005 Third Quarter Highlights Adjusted EPS ($1.92), ($1,083) million Net Loss, $47.2 billion Revenue - excludes special items Reported EPS ($2.89), ($1,633) million Net Loss Significant loss at GMNA highlights need for acceleration of turnaround plan Restructuring efforts continue to improve GME per
Slide 5: Third Quarter Adjusted Results Net Income
2004 2005 2005 Fav/(Unfav) 2004 ---------------- $ Millions ----------------- GMNA ($88) ($1,627) ($1,539) GME (236) (150) 86 GMLAAM 27 25 (2) GMAP 78 176 98 Total Automotive (219) (1,576) (1,357) GMAC 620 675 55 Corporate Other (86) (182) (96) Total Net Income 315 (1,083) (1,398) EPS (excl. special
Slide 6: Aggressive GM Turnaround Actions
Aggressive GM Turnaround Actions Tentative GM/UAW agreement, subject to ratification and final documents, to significantly reduce GM's health care costs Projected $15 billion reduction to health care liability Annual health care expense reduction of approximately $3 billion Annual cash savings of ap
Slide 7: Revenue Growth Initiatives Also Important
Revenue Growth Initiatives Also Important Intense focus on our goal of improving both revenue and contribution margin Intend to maintain our product-related capital spending Continue to improve the execution of our new products Reallocated capital and engineering to support more fuel efficient vehic
Slide 8: General Motors Acceptance Corporation
General Motors Acceptance Corporation
Slide 9: GMAC Highlights
GMAC Highlights 2005 Earnings GMAC net income through September closely tracking last year's record results Earnings through Q3 of 2005 totaled $2.2 billion YTD RoE of 13.1% GMAC likely to exceed its 2005 target net income of $2.5 billion 2005 Liquidity Position At end of Q3, GMAC had global cash po
Slide 10: Recent / Pending Funding Developments
Recent / Pending Funding Developments Residential Capital (ResCap) Secured investment grade credit rating from all rating agencies Raised $4 billion through private bond issuance at borrowing spreads well- below those of GMAC Received aggregate commitments for $3.5 billion of bank credit lines GMAC
Slide 11: Recent / Pending Funding Developments (cont.)
Recent / Pending Funding Developments (cont.) Executed 5-year auto whole loan agreement with BoA to sell full spectrum of active retail loans of up to $55 billion $5 billion whole loan sale in July Up to $10 billion annually for the next 5 years GMAC's U.S. term funding program for 2005 already comp
Slide 12: Consolidated Earnings Trend
Consolidated Earnings Trend $ millions Non-Financing 16% 22% 24% 30% 26% 31% 34% 30% 34% 51% 49% % of Income Financing Mortgage / Insurance
Slide 13: 2005 Net Income
2005 Net Income Financing Operations Mortgage Operations Insurance Operations In Excess of $2.5 Billion
Slide 14: Net Income - First Nine Months
Net Income - First Nine Months Commercial 229 135 94 243 ResCap 902 681 221 796 Mortgage Memo:
Slide 15: Net Income - Third Quarter
2004 2005 2005 Fav/(Unfav) 2004 ------------ $ Millions -------------- ------------ $ Millions -------------- ------------ $ Millions -------------- ------------ $ Millions -------------- ------------ $ Millions -------------- ------------ $ Millions -------------- ------------ $ Millions ----------
Slide 16: GMAC Insurance Operations
GMAC INSURANCE OPERATIONS
Slide 17: Insurance Net Income
Insurance Net Income $ millions
Slide 18: Insurance Premium / Revenue
Insurance Premium / Revenue Automotive Care Extended Service Contracts Maintenance Contracts GAP Insurance Commercial Automotive Dealer Inventory Property & Casualty Reinsurance Personal Vehicle Automobile Recreational Vehicle Motorcycle $ billions International (%) 3.2% 3.0% 11.6% 11.8% 14.2% 15.1%
Slide 19: GMAC Mortgage Operations
GMAC MORTGAGE OPERATIONS
Slide 20: Mortgage Group 2005 Outlook
Mortgage Group 2005 Outlook Residential Mortgage Industry Volume Lending Margins GMAC Mortgage Profitability
Slide 21: Mortgage Group 2005 Outlook
Mortgage Group 2005 Outlook Growth in Residential Market Share 9th consecutive year Higher Mortgage Servicing Income Profitable Expansion Overseas Substantial Increase in Commercial Mortgage Loan Production G G G G
Slide 22: Mortgage Net Income
Mortgage Net Income $ millions Memo: ($trillions) Industry Volume 2.0 2.6 3.8 2.8 ^ 2.7
Slide 23: ResCap
ResCap Successfully achieved investment grade ratings for ResCap Positioned to be "self-funding" over medium term Raised $4 billion in private placement of bonds at spreads well below those of GMAC - Exchange Offer in October Received aggregate commitments from its bank syndicate to provide credit l
Slide 24: GMAC Commercial Mortgage
GMAC Commercial Mortgage GMAC executed definitive binding agreement to sell majority stake in GMAC Commercial Mortgage By introducing equity partners, Commercial Mortgage operations will have adequate capital to sustain profitable growth Terms of transaction will provide GMAC with: $5 billion dollar
Slide 25: GMAC Financing Operations
GMAC FINANCING OPERATIONS
Slide 26: Financing Net Income
Financing Net Income $ millions
Slide 27: 2005 Financing Outlook
2005 Financing Outlook 2005 Outlook R Y Rising Market Interest Rates Widening GMAC Borrowing Spreads Balance Sheet Capacity Limitations Y G G Credit Losses Gains on Off-Lease Vehicles
Slide 28: Transforming Auto Finance Business Model
Transforming Auto Finance Business Model Transition from "Storage Business" to "Moving Business" Historical Model: "Storage Business" Originate auto loans Store on GMAC balance sheet Earn net interest margin New Model: "Moving Business" Originate auto loans Sell auto loans to financial institutions
Slide 29: Originate/Sell Auto Finance Model
Originate/Sell Auto Finance Model GMAC "Front-End" Financial Institutions "Back-End" Unique Origination Platform Captive Financing for GM's Subvented Business Auto Loan Underwriting Expertise Loan Servicing Expertise Low Cost of Funds Balance Sheet Capacity
Slide 30: GMAC / Bank of America $55 Billion Whole Loan Agreement
GMAC / Bank of America $55 Billion Whole Loan Agreement - - Origination - - Underwriting - - Servicing Competencies $5 billion sold at closing BofA Up to $10 billion annually through 2010 - - Low-Cost Funding - - B/S Capacity Competencies
Slide 31: Capital Allocation Strategy
Capital Allocation Strategy Free-up capital at Auto Financing Operations by transitioning to an "originate / sell" business model Redeploy capital to ResCap and Insurance Free-up capital from sale of majority equity stake in Commercial Mortgage Redeploy capital to ResCap and Insurance Remit majority
Slide 32: GMAC Global Liquidity
GMAC Global Liquidity Strong global liquidity position 3Q 2005 cash balance of $24.3 B* Over $100 B of unutilized bank lines, auto whole loan and conduit capacity 2005 U.S. term funding completed GMAC will seek to raise additional financing this year opportunistically Such borrowings will represent
Slide 33: GMAC Liquidity Profile
GMAC Liquidity Profile *Includes cash, excludes on-balance sheet secured debt and the related assets Maturities of interest-earning assets exceed maturities of interest- bearing liabilities for any given period
Slide 34: New Funding Sources
New Funding Sources Cultivating many new funding channels Automotive Whole Loan Sales Agreements Bi-lateral flow agreements Syndicated multi-investor whole loan transactions Sale of subordinated tranches in the capital markets Non-traditional asset securitization Sub-prime auto assets Sale of sub-pr
Slide 35: GM / GMAC Relationship
GMAC GM / GMAC Relationship
Slide 36: Strategic Challenges
Strategic Challenges GMAC facing challenging funding environment Access to unsecured debt market impaired Borrowing costs have increased sharply GMAC currently meeting all of its financing needs through wide variety of funding channels Medium-term liquidity outlook remains strong However, if access
Slide 37: GMAC Strategic Alternatives
GMAC Strategic Alternatives GM plans to take action intended to provide GMAC separate credit ratings GM exploring the possible sale of a controlling interest in GMAC to a strategic partner Transaction intended to: Restore GMAC's investment-grade credit rating Renew GMAC's access to low-cost funding
Slide 38: Summary
GMAC Summary
Slide 39: Summary and Conclusion
Summary and Conclusion GMAC expects to exceed 2005 target net income of $2.5 billion Results through 3Q05 closely tracking 2004's record results Accomplished many key strategic initiatives ResCap successfully accessing cost-effective unsecured funding and providing liquidity relief to GMAC Five-year
Slide 40: GMAC
GMAC
Slide 41: General Motors Acceptance Corporation
General Motors Acceptance Corporation
Slide 42: GMAC Supplemental Chart
GMAC _ supplemental Chart Reconciliation to Adjusted Net Revenue, Net Income / EPS 93 - 2004 & 2008
Slide 43: General Motors Acceptance Corporation
General Motors Acceptance Corporation
General Motors Acceptance — Debt Investor Presentation (October 2005) on 6ix