Jeffrey Brown to Step Down as Ally Financial’s CEO

  Ally Financial

Jeffrey Brown, the long-serving CEO of Ally Financial, is set to leave the bank in January 2024 for a new position at used car company Hendrick Automotive Group, based in Charlotte, North Carolina. The announcement was made in a press release by the bank on Wednesday, but a successor for Brown has not yet been named. Brown is expected to address the transition during Ally’s third-quarter earnings call on Oct. 18.

Brown’s Legacy at Ally Financial

Brown joined Ally Financial in 2009 as a corporate treasurer, shortly after the bank had been rebranded from GMAC Bank, a division of General Motors. By 2015, he had ascended to the position of CEO, a year after the U.S. government sold its $1.28 billion stake in the company. Brown’s tenure at the bank was marked by a significant financial turnaround, transforming GMAC into a bank that mattered in the industry.

Brown’s Move to Hendrick Automotive

Brown will stay at Ally until Jan. 31, 2024, though he could potentially leave earlier if deemed necessary for a smooth transition. He expressed enthusiasm about joining Hendrick Automotive, a longtime customer of Ally, and hopes to continue building on Hendrick’s relationship with Ally.

Challenges in the Auto Lending Sector

The auto lending sector, a key focus for Ally since it was established as GMAC in 1919, is currently facing several challenges. Delinquencies and defaults in auto loans have been on the rise, and several banks are pulling back from the sector. Despite these challenges, Ally has remained committed to auto financing, though recent job cuts have seen the company’s workforce reduced by 5%.

Potential Impact on Ally Financial

The departure of Brown could potentially impact the earnings outlook for Ally Financial, with rising interest rates being a key concern. Brown has been praised by Franklin Hobbs, chair of Ally’s board, for his exceptional leadership and commitment to excellence throughout his time at the bank.