Ally Bank 2012 Annual Report Download - page 55

53
expense was less favorable in 2012 due to a greater decline in portfolio-level reserves in 2011 associated with higher recoveries on
nonperforming exposures, combined with the runoff of the majority of our higher-risk non-core portfolio.
2011 Compared to 2010
Loss from continuing operations before income tax expense for Corporate and Other was $2.0 billion for the year ended December 31,
2011, compared to $2.7 billion for the year ended December 31, 2010. Corporate and Other's loss from continuing operations before income
tax expense for both periods was driven by net financing losses, which primarily represents original issue discount amortization expense and
the net impact of our FTP methodology, which includes the unallocated cost of maintaining our liquidity and investment portfolios.
The improvement in the loss from continuing operations before income tax expense for the year ended December 31, 2011, was
primarily due to a decrease in original issue discount amortization expense related to bond maturities and normal monthly amortization and
favorable net impact of the FTP methodology. The net FTP methodology improvement was primarily the result of favorable unallocated
interest costs due to lower non-earning assets and unamortized original issue discount balance. Additionally, 2011 was favorably impacted by
a $121 million gain on the early settlement of a loss holdback provision related to certain historical automotive whole-loan forward flow
agreements, a reduction in debt fees driven by the restructuring of our secured facilities and the termination of our automotive forward flow
agreements, and by a lower loss on the extinguishment of certain Ally debt (which included accelerated amortization of original issue
discount of $50 million for the year ended December 31, 2011, compared to $101 million in 2010).
Corporate and Other also includes the results of our Commercial Finance Group. Our Commercial Finance Group earned income from
continuing operations before income tax expense of $141 million for the year ended December 31, 2011, compared to $182 million for the
year ended December 31, 2010. The decrease was primarily due to lower asset levels partially offset by lower expenses and favorable loss
provisions.
Cash and Securities
The following table summarizes the composition of the cash and securities portfolio held at fair value by Corporate and Other.
December 31, ($ in millions) 2012 2011
Cash
Noninterest-bearing cash $ 944 $ 1,768
Interest-bearing cash 5,942 9,781
Total cash 6,886 11,549
Trading securities
Mortgage-backed —589
Total trading securities —589
Available-for-sale securities
Debt securities
U.S. Treasury and federal agencies 1,124 1,051
U.S. states and political subdivisions —1
Foreign government —106
Mortgage-backed 6,191 6,722
Asset-backed 2,332 2,520
Other debt (a) —305
Total debt securities 9,647 10,705
Equity securities 44
Total available-for-sale securities 9,651 10,709
Total cash and securities $ 16,537 $ 22,847
(a) Includes intersegment eliminations.
Table of Contents
Management's Discussion and Analysis
Ally Financial Inc. • Form 10-K