DETROIT — Ally Financial Inc.'s net income surged in the third quarter as the lender generated its highest level of auto loan and lease originations in five years.
The Detroit company reported net income of $476 million in the third quarter, a 25 percent increase from last year's third quarter and nearly double the $241 million in net income reported in the second quarter. Revenue rose 5 percent year over year to $1.68 billion.
The latest quarter's results were markedly better for Ally, one of the largest U.S. auto lenders, than in the second quarter, which suffered a greater impact from the coronavirus pandemic.
Still, Ally executives warned investors Friday that while current credit metrics are benefiting the lender, uncertainty remains as the nation moves through the pandemic without a firm plan for further government intervention.
"The U.S. consumer entered 2020 on solid footing and demonstrated a higher degree of resiliency despite significant and ongoing challenges aided by meaningful and necessary fiscal stimulus," Ally CEO Jeffrey Brown said on a call with analysts and investors. "While recent trends suggest a broader recovery is underway in various pockets of the economy, we're mindful of the currently expired stimulus benefits and the ongoing uncertainty on the outlook of COVID."
Ally's auto originations during the latest period — $9.8 billion — represented a 5.4 percent increase over third-quarter 2019 levels and a 36 percent jump from the second quarter. Auto originations were sourced from 3.2 million applications.