Ally Financial reported net income of $268 million. This compares to net income of $182 million in the prior quarter and $423 million for Q3 2014, which included $130 million in income from discontinued operations.
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The company reported core pre-tax income of $431 million, excluding repositioning items, in the third quarter of 2015, compared to $435 million in the prior quarter and $467 million in the comparable prior year period.
Adjusted earnings per diluted common share for the quarter were $0.51, compared to $0.46 in the previous quarter and $0.53 in the prior year period. Ally reported generally accepted accounting principles (GAAP) earnings of $0.47 per common share in the third quarter of 2015.
Improved net financing revenue, excluding original issue discount (OID), continued to drive strong results and totaled $981 million in the third quarter of 2015, up from $936 million a year ago. Revenue from retail auto loan growth more than offset a decline in net lease revenue.
Further, Ally continued to reduce its cost of funds, resulting in a quarter-over-quarter 9 basis point increase to net interest margin (NIM), excluding OID, and ended the quarter at 2.67 percent. Credit performance during the quarter was in line with expectations with strong retail auto loan growth primarily driving $211 million of provision expense for the quarter, up from $102 million in the third quarter of 2014.
Non-interest expenses declined by $68 million, or 9 percent year-over-year, resulting from continued expense reduction efforts and lower weather-related losses in the insurance operations. The adjusted efficiency ratio improved to 44 percent for the quarter, from 46 percent in the prior quarter and 49 percent in the prior year period.
Consumer auto originations remained robust at $11.1 billion for the quarter, increasing from $10.8 billion last quarter and down from $11.8 billion in the same period last year, with the company on track to exceed its originations target in the high $30 billions for 2015.
Gains in the Growth and Chrysler channels continued to drive consumer auto originations, and excluding GM lease and subvented, originations increased 36 percent year-over-year. Separate from originations, during the quarter the company also completed a previously announced purchase of $607 million of consumer loans and leases from Mitsubishi Motors Credit of America. ■