Ally Bank 2011 Annual Report Download - page 14

Table of Contents
Ally Financial Inc. • Form 10−K
• Community Reinvestment Act — Under the Community Reinvestment Act (CRA), a bank has a continuing and affirmative obligation, consistent
with the safe−and−sound operation of the institution, to help meet the credit needs of its entire community, including low− and moderate−income
neighborhoods. The CRA does not establish specific lending requirements or programs for financial institutions. However, institutions are rated
on their performance in meeting the needs of their communities.
• Other — Our U.S. mortgage business has subsidiaries that are required to maintain regulatory capital requirements under agreements with the
GSEs and the Department of Housing and Urban Development.
Employees
We had approximately 14,800 and 14,400 employees worldwide at December 31, 2011 and 2010, respectively.
Additional Information
The results of operations for each of our reportable operating segments and the products and services offered are contained in the individual business
operations sections of Management's Discussion and Analysis of Financial Condition and Results of Operations. Financial information related to reportable
operating segments and geographic areas is provided in Note 28 to the Consolidated Financial Statements.
Our Annual Report on Form 10−K, Quarterly Reports on Form 10−Q, and Current Reports on Form 8−K (and amendments to these reports) are
available on our internet website, free of charge, as soon as reasonably practicable after the reports are electronically filed with or furnished to the SEC.
These reports are available at www.ally.com. Choose Investor Relations, Financial Information, and then SEC Filings (under About Ally). These reports can
also be found on the SEC website at www.sec.gov.
Item 1A. Risk Factors
Our businesses face many risks and uncertainties, any of which could result in a material adverse effect on our results of operations or financial
condition. We believe that the most significant of the risks and uncertainties that we face are described below. This Form 10−K is qualified in its entirety by
these risk factors.
Risks Related to Regulation
Our business, financial condition, and results of operations could be adversely affected by regulations to which we are subject as a result of our bank
holding company status.
We are a bank holding company under the Bank Holding Company Act of 1956 (BHC Act). Many of the regulatory requirements to which we are
subject as a bank holding company were not previously applicable to us and have and will continue to require significant expense and devotion of resources
to fully implement necessary policies and procedures to ensure compliance. Compliance with such laws and regulations involves substantial costs and may
adversely affect our ability to operate profitably. Recent events, particularly in the financial and real estate markets, have resulted in bank regulatory
agencies placing increased focus and scrutiny on participants in the financial services industry, including us. For a description of our regulatory
requirements, see Certain Regulatory Matters in Item 1. Business.
Ally is subject to ongoing supervision, examination and regulation by the FRB, and Ally Bank by the FDIC and the Utah DFI, in each case, through
regular examinations and other means that allow the regulators to gauge management's ability to identify, assess, and control risk in all areas of operations
in a safe−and−sound manner and to ensure compliance with laws and regulations.
Ally is currently required by its banking supervisors to make improvements in areas such as board and senior management oversight, risk
management, regulatory reporting, internal audit planning, capital adequacy process, stress testing, and Bank Secrecy Act / anti−money−laundering
compliance, and to continue to reduce problem assets. Separately, Ally Bank is currently required by its banking supervisors to make improvements in areas
such as compliance management and training, consumer protection monitoring, consumer complaint resolution, internal audit program and residential
mortgage loan pricing, and fee monitoring. These requirements are judicially enforceable, and if we are unable to implement and maintain these required
actions, plans, policies and procedures in a timely and effective manner and otherwise comply with the requirements outlined above, we could become
subject to formal supervisory actions which could subject us to significant restrictions on our existing business or on our ability to develop any new
business. Such forms of supervisory action could include, without limitation, written agreements, cease and desist orders, and consent orders and may,
among other things, result in restrictions on our ability to pay dividends, requirements to increase capital, restrictions on our activities, the imposition of
civil monetary penalties, and enforcement of such action through injunctions or restraining orders. We could also be required to dispose of certain assets and
liabilities within a prescribed period. The terms of any such supervisory action could have a material adverse effect on our business, operating flexibility,
financial condition, and results of operations.
Our ability to engage in certain activities may be adversely affected by our status as a bank holding company.
As a bank holding company, Ally's activities are generally limited to banking or to managing or controlling banks or to other activities deemed
closely related to banking or otherwise permissible under the BHC Act and related regulations. Likewise, subject to certain exceptions, Ally is not permitted
to acquire more than 5% of any class of voting shares of any nonaffiliated bank or bank holding company, directly or indirectly, or to acquire control of any
other company, directly or indirectly (including by acquisition of 25% or more of a class of voting shares). Upon our bank holding company approval, we
were permitted an initial two−year grace period to bring our activities and investments into conformity with these restrictions. This grace period expired in
December 2010. The FRB initially granted a one−year extension that expired in December 2011, and recently granted a second one−year extension that
expires in December 2012. We will be
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