Ally 2Q loss widens to $927M on charges

Ally posts slightly larger 2nd-qtr loss on hefty charges related to former mortgage division

Associated Press

NEW YORK (AP) -- Ally Financial Inc. said Wednesday its second-quarter loss widened slightly, pulled down by more than $1 billion in charges related to its former mortgage banking division.

Ally said its loss totaled $927 million compared with a loss of $898 million in the same quarter of 2012.

The recent quarter's results included a $1.6 billion charge related to its settlement in the bankruptcy protection case of Residential Capital, or ResCap. Those expenses were partially offset by about $600 million in tax benefits related to the settlement charge and the sales of certain international businesses.

Ally, the former finance arm of automaker General Motors, now operates as an auto finance company and bank. It remains 74 percent government-owned after a bailout.

The company said income from its automotive finance operations fell 13 percent to $382 million, while insurance income more than doubled to $45 million. Its mortgage business posted a loss of $27 million versus income of $102 million a year ago.

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