Michael Carpenter, who retired as CEO of Ally Financial on Monday, can leave saying, “Mission accomplished.”
On Carpenter’s watch, Ally repaid its U.S. government bailout plus a profit for taxpayers and freed itself of government ownership, effective in December.
At the tail end of 2008 the U.S. Treasury rescued Ally’s predecessor company, GMAC, in the runup to General Motors’ bankruptcy restructuring in 2009.
Carpenter, 67, joined Ally’s board of directors in May 2009 and became CEO that November.
According to the U.S. Treasury, taxpayers invested $17.2 billion in Ally over time and recovered $19.6 billion -- generating a profit of about $2.4 billion.
Ally was grateful for the help, but government ownership had been a migraine headache for six years, Carpenter said in an interview in San Francisco last month. It turned out to be his last sit-down with Automotive News as Ally’s CEO.
“There were so many ways we had been handcuffed,” by government ownership, Carpenter said.
For instance, he said, the government wouldn’t allow Ally to fund loans for customers with credit scores below 660 using money from Ally’s online bank, which would have been cheaper to use. Ally did fund subprime loans, he said, but it had to use higher-cost funds, he said.
Carpenter has used the phrase “free at last” to describe Ally’s status post the bailout, and he used the expression a couple of times during the interview. Carpenter’s successor as CEO, Jeffrey Brown, 41, also sat in, but Carpenter did most of the talking. Brown at the time was CEO of Ally’s Dealer Financial Services unit.
Carpenter’s retirement hadn’t been announced at the time. In a statement Monday, Carpenter said he had been communicating with Ally’s board of directors about succession planning for “several months.”
He leaves on a high note.
“We go into 2015 very confident and very strong,” Carpenter told Automotive News. “The market environment is strong. Interest rates are low. The company is in better shape, with a stronger capital base, a lower cost of funds and greater liquidity than it has ever had. Dealer relationships have never been stronger.
“The one issue the board had was government ownership. Every time we got together, they’d say, ‘We hate it.’”