Ally Financial Inc. · NYSE:ALLY
Ally Financial — Merger or Acquisition (February 2020)
21 slides from Ally Financial's merger presentation, Feb 19, 2020
Slide 1: Announcing Ally's acquisition of CardWorks
Exhibit 99.1 Ally Financial Inc. Announcing Ally’s acquisition of CardWorks February 19, 2020 Contact Ally Investor Relations at (866) 710-4623 or investor.relations@ally.com 1Exhibit 99.1 Ally Financial Inc. Announcing Ally’s acquisition of CardWorks February 19, 2020 Contact Ally Investor Relation
Slide 2: Forward-Looking Statements and Additional Information
Forward-Looking Statements and Additional Information This presentation and related communications contain forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1995. These statements can be identified by the fact that they do not relate strictly to histori
Slide 3: Acquisition of CardWorks by Ally Financial
Acquisition of CardWorks by Ally Financial CardWorks is a leading non-prime credit card and consumer finance provider in the U.S. with servicing capabilities across the credit spectrum Top-20 U.S. Credit 3.8 million Experienced, Card Issuer Active Accounts Tenured Top-15 U.S. Merchant (2) Workforce
Slide 4: Transaction Highlights
Transaction Highlights > Acquisition aligned with Ally’s long-term strategic objectives ▪ Advances Ally’s evolution in becoming a leading full-service financial partner for our customers > Complements Ally’s existing offerings, adding a core banking product Strategic ▪ Adds proven unsecured capabili
Slide 5: Transaction Summary
Transaction Summary (1) ▪ Aggregate price of $2.65 billion, subject to final closing equity and other adjustments (2) ▪ 51% cash ($1.35 billion) | 49% stock ($1.30 billion) or 39.5 million shares of Ally common stock − Stock Consideration: 38.15 million shares to CardWorks employees | 1.35 million s
Slide 6: CardWorks: Scalable Engine for Future Growth
CardWorks: Scalable Engine for Future Growth Customer-centric culture & disciplined risk management drive solid execution CardWorks Avg. Tenure of Established 2.8 M 1.7 K Employees w/ Top 40 20% 15+ Years 1987 Customers Employees 10+ year tenure Managers > Credit Card: Market leading, data-driven ca
Slide 7: CardWorks: Total Addressable Market
CardWorks: Total Addressable Market Growing credit card market with meaningful expansion opportunities (1) (1) U.S. Credit Card Industry: Balances U.S. Credit Card Industry: Accounts ($ billions) (# millions) 5% CAGR 4% CAGR $927 $870 $834 508 $779 479 $733 469 453 $700 $683 424 413 399 ~30-35% 550-
Slide 8: CardWorks: Financial Profile
(1) CardWorks: Financial Profile Credit Card Steady Growth, Positioned for Ongoing Expansion (3) RoA Profile CardWorks Balance Sheet ($ billions) $4.7 $4.6 Credit Card $4.1 22-24% $0.6 $0.7 Recreational Lending $3.5 $0.5 Net Margin $0.7 Other Assets $0.5 $2.8 $0.4 $0.3 $0.3 $2.4 $0.3 $0.2 $0.3 $0.2
Slide 9: Ally + CardWorks: Pro forma Combination (2019)
Ally + CardWorks: Pro forma Combination (2019) Significantly Expands Customers Diversifies & Expands Revenues (1) Total Customers Adjusted Total Net Revenue (# millions) ($ billions) +33% +17% 11M+ $7.4 B $6.3 B 8.5M Ally Ally + CardWorks Ally Ally + CardWorks 2019 EoP 2019 Pro forma 2019 FY 2019 Pr
Slide 10: CardWorks: Profitable Across Cycles
CardWorks: Profitable Across Cycles > CardWorks has generated solid returns across a variety of macroeconomic environments > Growth trends reflect operating discipline and proactive balance sheet management > Credit and underwriting utilize decades of experience in disciplined, data-first approach (
Slide 11: Ally: Enhanced Profitability Metrics
Ally: Enhanced Profitability Metrics CardWorks acquisition to be accretive to Ally’s return profile ▪ Loan Mark: Credit card portfolio at par, including appropriate reserve ▪ CECL Reserve: Increase ALLL to 160% of NCO’s (1)(2) (2) ▪ Ally Adjusted TBVPS Dilution : 10% | Ally GAAP BVPS Dilution : 6% D
Slide 12: Ally: Steady and Improved 2020 Financial Outlook
Ally: Steady and Improved 2020 Financial Outlook 2020 Outlook Ally Stand-Alone Ally + CardWorks (1) Adjusted EPS % % ↑ 10 - 15 YoY ↑ 10 - 15 YoY Growth Metrics reflect steady coverage rate assumption under CECL methodology (1) % % Core ROTCE 12 - 13 12 - 13 Adjusted Total % % ↑ 6 - 9 YoY ↑ 10 - 15 Y
Slide 13: Ally: Disciplined Capital Management
Ally: Disciplined Capital Management Dynamic and effective deployment of shareholder capital Ally: Q1 2014 → Q4 2019 % $3.3B 33 Increase in Ally’s Increase in Ally’s Adjusted (1) Adjusted Tangible Tangible Book Value (1) Book Value to $13.1B Ally: Since Mid-2016 % $3.8B 22.6 Net Decrease in Common C
Slide 14: Ally: Strategic Priorities
Ally: Strategic Priorities Relentless Customer Focus and ‘Do It Right’ Culture Ongoing optimization of market leading Auto Lending and Insurance business lines Consumer & Commercial Sustained growth in customers and optimization Savings & Insurance of deposit funding profile Checking Expand consumer
Slide 15: Supplemental
Supplemental 15Supplemental 15
Slide 16: CardWorks: Stand-alone Financial Statements
Supplemental (1) CardWorks: Stand-alone Financial Statements CardWorks Stand-alone Financials ($ millions) 2014 2015 2016 2017 2018 2019 Net Financing Revenue $ 422 $ 504 $ 636 $ 756 $ 811 $ 859 Other Revenue 166 157 199 219 249 230 Total Revenue $ 588 $ 661 $ 835 $ 974 $ 1,061 $ 1,088 Provision for
Slide 17: Notes on Non-GAAP and Other Financial Measures
Supplemental Notes on Non-GAAP and Other Financial Measures The following are non-GAAP financial measures which Ally believes are important to the reader of the Consolidated Financial Statements, but which are supplemental to, and not a substitute for, GAAP measures: Core Net Income Attributable to
Slide 18: Notes on Non-GAAP and Other Financial Measures
Supplemental Notes on Non-GAAP and Other Financial Measures 1) Adjusted efficiency ratio is a non-GAAP financial measure that management believes is helpful to readers in comparing the efficiency of its core banking and lending businesses with those of its peers. In the numerator of Adjusted efficie
Slide 19: Ally: GAAP to Core Results – Adjusted TBVPS
Supplemental Ally: GAAP to Core Results – Adjusted TBVPS Adjusted Tangible Book Value per Share ( Adjusted TBVPS ) FY 2019 1Q 2014 Inc. / (Dec.) Numerator ($ billions) GAAP shareholder's equity $ 14.4 $ 14.5 $ (0.0) Preferred equity - (1.3) 1.3 GAAP common shareholder's equity $ 14.4 $ 13.2 $ 1.2 Go
Slide 20: Ally: GAAP to Core Results
Supplemental Ally: GAAP to Core Results ($ millions) FY 2019 Change in the Core OID & fair value of (1) GAAP Repositioning Non-GAAP equity Items securities Consolidated Ally Net financing revenue $ 4,633 $ 29 $ - $ 4,662 Total other revenue 1 ,761 - (89) 1 ,672 Total net revenue $ 6,394 $ 29 $ (89)
Slide 21: CardWorks: GAAP to Adjusted Results
Supplemental CardWorks: GAAP to Adjusted Results CardWorks: Adjusted Return on Average Assets 2003 2004 2005 2006 2007 2008 2009 2010 2011 2012 2013 2014 2015 2016 2017 2018 2019 ($ millions) Numerator GAAP pretax income / (loss) $ (93) $ 286 $ 277 Legacy expense related to strategic capital raise a
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