NEW YORK (Reuters) – Ally Financial Inc, the United States’ largest maker of car loans, hopes that people have forgotten the time when “subprime” became a synonym for “disaster.”
Ally, once known as GMAC Financial Services, is getting ready to go public this year, and is making the case that subprime loans for used car buyers are not about to produce the same results that they did in the housing market a few years ago — a near-collapse of the financial system.
Auto loans performed relatively well during the downturn, and demand for cars is up, so auto lending is one of the few types of consumer debt that is growing.
Ally wants to show investors that this makes it different from many other banks, which are struggling with weak loan demand and their own soured mortgages.
The company is making more loans to subprime borrowers, and financing more purchases of used cars, both
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