Ally Financial Reaches Settlements with the FHFA and the FDIC
Oct 29, 2013
DETROIT, Oct. 29, 2013 -- Ally Financial Inc. (Ally) has reached settlements with the Federal Housing Finance Agency (FHFA) and the Federal Deposit Insurance Corporation, as receiver for certain failed banks (FDIC), for all pending litigation and related claims. The settlements require pending litigation against Ally to be dismissed, and the FHFA and the FDIC released claims will no longer be exceptions to the third party releases related to the Residential Capital, LLC (ResCap) settlement. Ally expects to record a charge of $170 million in the third quarter in connection with the FHFA and the FDIC settlements.
"These settlements are key steps in Ally addressing its remaining legacy mortgage risks," said Chief Executive Officer Michael A. Carpenter. "We are pleased to be able to put these matters behind us and continue to focus on our leading automotive finance and direct banking operations."
As part of the settlement with the FHFA, the ResCap Chapter 11 Plan (the Plan) will be amended to add Freddie Mac, and the FHFA, as conservator for Freddie Mac and Fannie Mae, as exceptions to the third party releases only with respect to certain ordinary-course claims against Ally Bank, as a former mortgage seller and servicer.
The FHFA and the FDIC settlements are not conditioned on the Plan becoming effective. The FHFA and the FDIC have agreed not to object to final confirmation of the ResCap Chapter 11 Plan. The Plan confirmation hearing is currently scheduled for Nov. 19, 2013.
About Ally Financial
Ally Financial Inc. is a leading automotive financial services company powered by a top direct banking franchise. Ally's automotive services business offers a full suite of financing products and services, including new and used vehicle inventory and consumer financing, leasing, inventory insurance, commercial loans and vehicle remarketing services. Ally Bank, the company's direct banking subsidiary and member FDIC, offers an array of deposit products, including certificates of deposit, savings accounts, money market accounts, IRA deposit products and interest checking. Ally's Commercial Finance unit provides financing to middle-market companies across a broad range of industries.
With approximately $150.6 billion in assets as of June 30, 2013, Ally operates as a bank holding company. For more information, visit the Ally media site at http://media.ally.com or follow Ally on Twitter: @Ally.