Ally Bank 2011 Annual Report Download - page 76

Table of Contents
Management's Discussion and Analysis
Ally Financial Inc. • Form 10−K
Consumer loan originations retained on−balance sheet as held−for−investment increased $9.5 billion to $44.6 billion at December 31, 2011, compared
to 2010. The increase was primarily due to improved automotive industry sales and higher GM and Chrysler market share.
The following table shows the percentage of the total consumer finance receivables and loans recorded at historical cost reported at carrying value
before allowance for loan losses by state and foreign concentration. Total automobile loans were $63.5 billion and $51.3 billion at December 31, 2011 and
2010, respectively. Total mortgage and home equity loans were $10.0 billion and $10.7 billion at December 31, 2011 and 2010, respectively.
2011(a) 2010
December 31, Automobile
1st Mortgage
and home
equity Automobile
1st Mortgage
and home
equity
Texas 9.5% 5.5% 9.2% 4.4%
California 4.6 25.7 4.6 24.5
Florida 4.8 4.0 4.4 4.1
Michigan 4.0 4.8 3.7 5.0
Illinois 3.1 5.0 2.8 4.7
New York 3.5 2.3 3.4 2.4
Pennsylvania 3.6 1.6 3.2 1.7
Ohio 2.9 1.0 2.5 1.0
Georgia 2.5 1.8 2.2 1.8
North Carolina 2.2 2.1 2.0 2.0
Other United States 32.9 45.9 29.4 44.7
Canada 11.8 0.2 14.2 3.6
Brazil 4.7 — 5.2 —
Germany 4.3 — 5.7 —
Other foreign 5.6 0.1 7.5 0.1
Total consumer finance receivables and loans 100.0% 100.0% 100.0% 100.0%
(a) Presentation is in descending order as a percentage of total consumer finance receivables and loans at December 31, 2011.
We monitor our consumer loan portfolio for concentration risk across the geographies in which we lend. The highest concentrations of loans in the
United States are in Texas and California, which represented an aggregate of 16.4% of our total outstanding consumer finance receivables and loans at
December 31, 2011.
Concentrations in our Mortgage operations are closely monitored given the volatility of the housing markets. Our consumer mortgage loan
concentrations in California, Florida, and Michigan receive particular attention as the real estate value depreciation in these states has been the most severe.
Repossessed and Foreclosed Assets
We classify an asset as repossessed or foreclosed (included in other assets on the Consolidated Balance Sheet) when physical possession of the
collateral is taken. We dispose of the acquired collateral in a timely fashion in accordance with regulatory requirements. For more information on
repossessed and foreclosed assets, refer to Note 1 to the Consolidated Financial Statements.
Repossessed assets in our Automotive Finance operations at December 31, 2011, increased $10 million to $56 million from December 31, 2010.
Foreclosed mortgage assets at December 31, 2011, decreased $61 million to $77 million from December 31, 2010.
Higher−risk Mortgage Loans
During the year ended December 31, 2011, we primarily focused our origination efforts on prime conforming and government−insured residential
mortgages in the United States and high−quality government−insured residential in Canada. Refer to Note 2 to the Consolidated Financial Statements for
additional information on our commitment to sell our Canadian residential mortgage portfolio. However, we continued to hold mortgage loans originated in
prior years that have features that expose us to potentially higher credit risk including high original loan−to−value mortgage loans (prime or nonprime),
payment−option adjustable−rate mortgage loans (prime nonconforming), interest−only mortgage loans (classified as prime conforming or nonconforming
for domestic production and prime nonconforming or nonprime for international production), and teaser−rate mortgages (prime or nonprime).
73