Ally Financial Inc. (NYSE: ALLY) reported Monday morning its first quarter 2020 financial results. According to the report, the digital financial services provider recorded a total net revenue of $1.41 billion, down 12% year over year (YoY). And adjusted total net revenue of $1.61 billion, an increase of 5% YoY – total net revenue includes mark-to-market on equity portfolio of $185 million. The results also include $903 million provision expense. Reserve increase reflects forecasted macroeconomic changes associated with the Coronavirus Disease 2019 (COVID-19) pandemic – implemented current expected credit losses (CECL) framework.
Ally Chief Executive Officer Jeffrey Brown commented on the quarter: “The emergence of the COVID-19 pandemic and its impact on the global economy has resulted in heightened uncertainty and challenges for consumers and businesses around the world. Against this difficult backdrop, I am proud of how the Ally team has resolutely focused on our customers while embracing our core values. “As this public health crisis unfolded, we took decisive and comprehensive actions to support our people, customers and communities. In addition to rapidly mobilizing 99% of our company with work-from-home capabilities and a $1,200 financial assistance payment for employees earning less than $100,000, we materially expanded health and family care benefits to ensure our employees were safe and optimally positioned to focus on our customers.”
Ally indicates that net loss attributable to common shareholders was $319 million in the quarter, compared to net income attributable to common shareholders of $374 million in the first quarter of 2019, driven by higher provision for loan losses due to reserve build driven by forecasted macroeconomic changes associated with the COVID-19 pandemic as well as the decline in the fair value of equity securities given the overall decline in equity markets in March.