This move aligns with Ally's mission to focus on its core services, including approximately 10 million customers in banking, brokerage, and auto financing. CardWorks, with its 38-year history in credit and payments, along with Merrick Bank's focus on non-prime and near-prime consumers, positions the acquisition to bolster its presence in the credit card market. Notable among Ally's achievements is its 10-year track record of consistent dividend payments, demonstrating strong commitment to shareholder returns. The company maintains a FAIR Financial Health Score of 2.21, according to InvestingPro metrics. Notable among Ally's achievements is its 10-year track record of consistent dividend payments, demonstrating strong commitment to shareholder returns. The company maintains a FAIR Financial Health Score of 2.21, according to InvestingPro metrics.
This move aligns with Ally's mission to focus on its core services, including approximately 10 million customers in banking, brokerage, and auto financing. CardWorks, with its 38-year history in credit and payments, along with Merrick Bank's focus on non-prime and near-prime consumers, positions the acquisition to bolster its presence in the credit card market. Notable among Ally's achievements is its 10-year track record of consistent dividend payments, demonstrating strong commitment to shareholder returns. The company maintains a FAIR Financial Health Score of 2.21, according to InvestingPro metrics.
On the other side of the deal, CardWorks CEO Dan Pillemer expressed enthusiasm for the acquisition, which he described as a natural expansion of their near-prime credit card operations. CardWorks has been a servicing partner to Ally's credit card platform since its inception.
Both companies have committed to a seamless transition for customers and employees affected by the sale. The completion of the deal is subject to customary closing conditions.
J.P. Morgan Securities LLC and Sullivan & Cromwell LLP advised Ally on the financial and legal aspects of the deal, respectively. CardWorks was advised by Cravath, Swaine & Moore LLP.
This move aligns with Ally's mission to focus on its core services, including approximately 10 million customers in banking, brokerage, and auto financing. CardWorks, with its 38-year history in credit and payments, along with Merrick Bank's focus on non-prime and near-prime consumers, positions the acquisition to bolster its presence in the credit card market.
The information for this article is based on a press release statement.
In other recent news, Ally Financial (NYSE:ALLY) has announced robust third-quarter earnings, with an adjusted earnings per share (EPS) of $0.95, largely due to tax credits from electric vehicle leases. This figure exceeded estimates from various financial firms including Citi, TD Cowen, and Janney. Despite this, TD Cowen maintained a hold rating on Ally Financial shares, citing near-term earnings risk due to credit and margin pressures.
In addition to the earnings report, Ally Financial declared quarterly cash dividends for its common and preferred stock shareholders. The common stock dividend is set at $0.30 per share, while preferred stock shareholders are set to receive payments amounting to $11.75 per share. These dividends underline Ally Financial's commitment to its shareholders.
In recent analyst activity, Truist Securities initiated coverage on Ally Financial's stock, assigning a Buy rating and setting a price target of $42.00. Citi also updated its financial model for Ally Financial, leading to a new price target of $55.00, increased from the previous $50.00, while maintaining a Buy rating on the stock.
In other developments, Ally Financial announced an executive transition, with Jason E. Schugel stepping down as Chief Risk Officer to become Senior Operating Adviser, and Stephanie N. Richard filling his previous role. Furthermore, Ally Financial's insurance segment reached a record $384 million in premiums. However, the company saw a decline of $600 million in retail deposits in the quarter. These recent developments provide important insights into the operations and strategies of Ally Financial.
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