盟友金融 (ALLY) 2026年第三季度业绩电话会议：营收增长9%，上调资产增长预期lg...

核心要点

• Ally Financial公布2026年第三季度调整后每股收益（EPS）为1.34美元，同比增长16%；调整后净营收增长9%至23亿美元。
• 净息差（NIM）环比上升3个基点至3.66%。管理层预计全年净息差为3.60%–3.65%，第四季度约为3.70%。
• 由于申请量增长20%至480万笔，零售汽车贷款发放量同比增长10%至129亿美元。本季度零售汽车资产组合增长了24亿美元。
• 拨备费用同比增长1.14亿美元至5.29亿美元，主要原因是资产增长推动了近9000万美元的CECL准备金计提。该计提使季度每股收益减少约0.20美元，有形普通股回报率（ROTCE）下降200个基点。
• 在零售汽车和企业融资业务增长的支持下，Ally将2026年平均生息资产增长预期从3%–5%上调至5%–6%。
• 信贷表现总体符合管理层预期，但2025年晚期和2026年早期发放的汽车贷款表现出较高的早期逾期率。

关键财务数据

业务与经营表现

经销商金融服务

Ally对480万笔汽车贷款申请做出了审批决定，同比增加20%，并实现了129亿美元的消费贷款发放量，增长10%。期末零售汽车资产同比增长8%。

第三季度新发放贷款收益率为9.4%，比第二季度高出约35个基点。定价举措贯穿整个季度，Ally在第三季度结束时新发放贷款收益率处于9%的高段区间。管理层预计，随着较新发行的贷款进入组合，组合收益率（不含对冲为9.2%）将逐步走高。

资产负债表外通道发放额连续第二个季度突破10亿美元。该业务在产生贷款发放和服务费收入的同时，使Ally能够支持经销商而无需将贷款计入资产负债表。汽车业务其他收入同比增长20%。

保险业务

核心税前利润同比增长2300万美元至7500万美元。签单保费为3.88亿美元，增加300万美元，而保险损失减少600万美元至1.35亿美元。今年迄今保险业务ROE约为30%。

企业融资业务

企业融资业务产生9800万美元税前利润，ROE为22%。资产组合规模达到158亿美元，同比增长40%，本季度大部分增长来自现有客户贷款关系。

本季度新承诺的贷款中，近90%由Ally担任牵头代理行。该资产组合完全由第一受偿权、高级担保浮动利率贷款组成，非应计贷款和关注类资产仍处于历史低位。

数字银行

Ally服务的客户数量达到360万，同比增长7%，创下连续第70个季度客户增长的纪录。管理层表示，客户群依然集中在千禧一代和Z世代。

管理层业绩指引

尽管预计年底联邦基金利率比1月份采用的假设高出约100个基点，且租赁残值持续承压，管理层仍维持了净息差预期。

Ally表示，短期内其资产负债表略呈资产敏感型，因为约600亿美元的浮动利率敞口重新定价上升。随着零售存款重新定价，这一效益预计将有所放缓，中期内资产负债表将变得更加负债敏感。管理层继续以随着时间的推移将净息差维持在3%高段区间为目标。

风险与关注领域

• 第三季度租赁终止产生了1600万美元的损失，反映出与Stellantis车辆及召回相关问题带来的拍卖价格和残值压力。管理层预计这一压力将持续到第四季度，随后随着投资组合转向更多元化的汽车制造商组合，将在2027年逐渐缓解。
• 2025年晚期和2026年早期发放的零售汽车贷款表现出较高的早期逾期率。管理层将这一增加的大部分归因于这些新发贷款的信用组合结构，并表示2026年第二和第三季度的贷款风控标准相对更紧。
• 30天以上的综合逾期率达到4.96%，同比上升6个基点。
• 管理层继续密切关注持续的高通胀、偿付能力压力、高油价、个人储蓄率下降以及失业对消费信贷的潜在影响。
• 资产负债表的持续增长带来了前置的CECL准备金计提要求，这可能会在相关资产产生收入之前拖累近期盈利。
• 较高的利率最初可能会支持浮动利率资产收益和汽车定价，但随后的存款重新定价可能会限制中期的净息差收益。

分析师问答要点

分析师高度关注信贷趋势以及 Ally 实现 1.6%–1.8% 长期零售汽车净核销率目标的路径。管理层表示资产组合表现符合预期，并将向该区间靠拢的过程描述为渐进趋势而非突变。正式的2027年指引预计将于1月发布。

关于汽车金融竞争，管理层表示未观察到竞争状况出现明显恶化。良好的经销商关系和更高的申请量使 Ally 能够保持选择性、调整核保标准并继续提高新发贷款收益率。

资本分配也是重点之一。Ally 在过去一年中回购了近 5 亿美元的股票，并将季度股息提高至 0.35 美元，这是自 2022 年以来的首次加息（提息）。其 2026 年的第二次信用风险转移（CRT）交易在发行时创造了超过 25 个基点的 CET1 资本。

管理层表示，资本优先事项在支持盈利性增长、维持健康的资本充足率以及向股东回报资本之间保持平衡。管理层还强调信用风险转移、通道发放和选择性资产出售是降低汽车业务资本密集度的工具。

在费用和人工智能方面，管理层表示 Ally 在维持支出纪律的同时，增加了对技术和营销的投资。公司正在关注代理商务和凭据共享风险，但表示观察到的活动仍处于低位。

业绩电话会完整文本

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完整财报电话会议逐字稿

管理层陈述

Operator

Good day, and thank you for standing by. Welcome to the Q3 2026 Ally Financial Earnings Conference Call. [Operator Instructions] Please be advised that today's conference is being recorded. I would now like to hand the conference over to your speaker today, Dan Ignacio, Executive Director Corporate FP&A, Investor Relations. Please go ahead.

Unknown Executive

Thank you, Daniel. Good morning, and welcome to Ally Financial's Third Quarter 2026 Earnings Call. This morning, our CEO, Michael Rhodes; and our CFO, Russ Hutchinson, will review Ally's results before taking questions. Presentational reference can be found on the Investor Relations section of our website, ally.com. Forward-looking statements and risk factor language governing today's call are on Page 2. GAAP and non-GAAP measures pertaining to our operating performance and capital results are on Page 3. As a reminder, non-GAAP or core metrics are supplemental to and not a substitute for U.S. GAAP measures. Definitions and reconciliations can be found in the appendix. And with that, I'll turn the call over to Michael. .

Michael Rhodes

Thank you, Dan, and good morning, everyone. I appreciate you joining us today for our third quarter earnings call. While I'll discuss the quarter in more detail in a moment, I'd like to take a step back and start with the bigger picture. We delivered another quarter of meaningful progress against the priorities we have laid out, and those results reflect a broader story unfolding across Ally. Ally is a stronger company today than it was just a few years ago. We have made deliberate choices about where to invest and grow and our results reinforce that we are on the right path. Over the past 2 years, retail auto and corporate finance assets have grown nearly 15%. Core ROTC has increased from 5% to 13%. Retail NCOs have declined by more than 30 basis points. And we have returned meaningful capital to shareholders while also building our capital base.

Taken together, we build an Ally to deliver stronger returns, greater resilience and sustainable growth. Now let me be clear, this isn't the finish line. I am proud of what we have achieved. Simply put, our strategy backed by disciplined execution is working. Moving to financial results. Third quarter adjusted EPS of $1.34 was up 16% year-over-year. Adjusted net revenue of $2.3 billion increased 9% year-over-year, and with noninterest expenses flat, we delivered another quarter of meaningful operating leverage. CET1 of 10.2% was up 10 basis points year-over-year and we remain pleased with our ability to execute a story of and, not or. That is, we are growing our core businesses, maintaining strong capital levels and returning capital to shareholders.

Our Focus 4 strategy remains simple, yet powerful. Importantly, none of this happens without our people and our differentiated brand and culture continue to amplify that strategy. Our teammates bring our promise to do it right to life every day with an unwavering commitment to show our customers, communities and each other. Our Life Today campaign continues to highlight Ally's unique ability to meet customers for life and money intersect in today's world. Building on our history of disruption and innovation, last month, we announced loyally, our first-ever loyalty experience. Moving beyond complexity to deliver meaningful value through discounts and seamless experiences with the simple fee-free model our customers know and love. More importantly, initiatives like loyalty demonstrate the investments we're making to strengthen customer relationships and position Ally for the future.

Ultimately, our folks is not on delivering compelling results in any single quarter. It's about ensuring the progress they are delivering today translates into a company that is stronger more resilient and capable of generating higher returns for years to come. While I'm pleased with this quarter's results, [indiscernible] grounded momentum we see across our franchise and the opportunities ahead of us. We know the path will not always be linear, but the direction is clear. And with that, let's turn to Slide 5. Our market-leading franchises continue to be a source of strength, underpinned by deep customer relationships, differentiated capabilities, relevant scale, and disciplined execution that continue to position us well in the markets we compete.

We continue to build on the momentum across each business with execution translate to accretive growth and improved returns. In Dealer Financial Services, our dealer-centric through-the-cycle approach is paying dividends. In auto, we decisioned 4.8 million applications, up 20% year-over-year as a refined go-to-market strategy continues to expand the top of the funnel and further our region in our industry. That application flow translates to $12.9 billion of originations, up 10% year-over-year. As we leverage the scale and infrastructure we've built, the focus remains on maximizing risk-adjusted returns. That means paring attractive growth with a disciplined credit posture. Our data-driven approach to portfolio management and dynamic underwriting continues to translate into more durable credit performance.

Importantly, Consumers have continued to demonstrate resilience as they navigate an evolving macro backdrop, and we remain encouraged by the performance we're seeing across the portfolio. Within insurance, written premiums of $388 million increased $3 million year-over-year and a 75% increase year-over-year in conquest activity reflects continued momentum across the business. Insurance continues to generate diversified, capital-efficient accretive earnings, evidenced by a year-to-date ROE of approximately 30%. More broadly, our differentiated go-to-market strategy in dealer financial services allows us to support dealers across the entire ecosystem, strengthen relationships, expanding our opportunity set and enhancing the value of the franchise. Corporate Finance delivered another impressive quarter, generating a 22% return on equity. Our portfolio now stands at $15.8 billion of 40% year-over-year.

Nonaccrual loans and criticized assets remain at historic lows, underscoring the credit first mindset that's long defined our business. Our established partnerships underwriting expertise and speed and certainty of execution remain core strength of the franchise and support attractive, consistent returns. At the digital bank, our differentiated value proposition and ability to provide exceptional products and experiences continues to drive customer growth that consistently outpaces industry averages. We now serve 3.6 million customers, up 7% year-over-year and marking our 70th consecutive quarter of growth. We continue to track highly engaged customers who skew towards millennial and Gen Z. Our national brand, digital first operating model and unmatched experience position us exceptionally well as consumer preferences continue to evolve.

In aggregate, these results reflect the strength of our franchises and the benefits of the investments we've made to expand products, build capabilities and create long-term value. We've been clear about what we have set out to accomplish, and our results today represent another step on our path to mid-teens returns. While that path may not always be linear, our convicty continues to grow. My confidence is based not only in this quarter's results, the momentum we see across our businesses and the opportunities ahead of us. And with that, I'll turn it over to Russ to walk through the financials in more detail.

Russell Hutchinson

Thank you, Michael. I'll begin by walking through third quarter performance on Slide 7. Net financing revenue, excluding OID, of $1.8 billion was up 10% year-over-year. Growth was in our core portfolios and lower funding costs supported continued NII expansion. Adjusted other revenue of $579 million was up 4% year-over-year. We continue to see solid momentum across our diversified revenue stream, insurance, smart option and pass-through program. Provision expense of $529 million was up $114 million year-over-year, primarily due to CECL reserve builds associated with continuing strength in asset growth. .

Our retail auto portfolio grew $2.4 billion in the quarter, which led to nearly $90 million of CECL reserve build in the period. Over time, this growth contributes to future earnings but presented a 3Q or $0.20 to EPS and 200 basis points to ROTCE. We saw 9% operating leverage as adjusted noninterest expense of $1.2 billion was relatively flat year-over-year, reflecting ongoing discipline and weather losses, which were slightly favorable to our baseline expectations. Let's move to Slide 7 to discuss margin in detail. Net interest margin of 3.66% increased 3 basis points quarter-over-quarter as the full benefit of second quarter deposit pricing actions was largely offset by losses on lease termination. Retail auto portfolio yield, excluding the impact from hedges of 9.2% was down sequentially, but given current originated yields, we anticipate the portfolio yield to migrate higher over time.

Consistent with commentary at an industry conference last month, lease yields in the quarter included a $16 million loss on lease terminations, reflecting continued pressure on Volantis auction prices and residual value stemming from broader brand and recall-related overhang. Given the current mix of our lease portfolio coming to termination, we expect the resulting pressure that persist into 4Q. Looking beyond that, we would expect the headwind to abate as we move through 2027, and the portfolio continues to shift towards a more diversified OEM MAX. Importantly, since announcing our partnership with a Pure battery electric OEM in March 2024, approximately half of our lease origination volume includes residual value guarantees, reducing the proportion of the portfolio is subject to volatility and residual value.

We continue to deliver strong earning asset growth, supporting the ongoing remixing of our balance sheet into higher return assets. Average earning assets were up 7% year-over-year with growth continuing to be concentrated in retail auto and corporate finance. Ending retail auto assets were up 8%, while corporate finance loans were up 40%. Growth in these asset classes continues to replace the runoff of lower-yielding mortgages, providing a structural tailwind to net interest margin over time. On the liability side, Cost of funds decreased 3 basis points quarter-over-quarter, driven by the full impact of deposit pricing actions taken during the second quarter. Deposit customers grew for a 70th consecutive quarter and are up 70% year-over-year, reflective of the strength of our brand and unique value proposition that Michael highlighted earlier.

Given the expectations for a series of Fed hikes, I want to provide color on how we expect our margin trajectory to unfold given the composition of our balance sheet. Movement in benchmark rates impact the pace and magnitude of remaining NIM expansion to our upper 3s target, but we remain confident across the range of beta. In the near term, our balance sheet is slightly asset sensitive as our roughly $60 billion in floating rate exposures reprice higher. That benefit moderates as our retail deposit portfolio reprices higher, ultimately inflecting towards liability sensitive over the medium term. Over time, the retail auto portfolio reprices higher with benchmark rates supporting NIM expansion.

In addition, the tailwind from asset remixing will continue to drive margin expansion toward our upper 3s target. I'll cover guidance in more detail later, but despite the evolving rate environment and near-term lease dynamics, we remain confident in the full year guide and a path to exit the year around the high end of the range we provided in January. Turning to Page 8. CET1 of 10.2% is up approximately 10 basis points versus the prior year. Under the current proposal for RSA, our CET1 would be 8.8% when fully phasing in AOCI, with RBA providing roughly 30 basis points of additional benefit. During the quarter, we executed our second credit risk transfer of 2026, generating more than 25 basis points of CET1 at issuance. We continue to execute on the story of And. We're supporting accretive, disciplined growth across our core franchises, maintaining healthy capital levels and returning capital to shareholders.

We've grown the retail auto and corporate finance portfolios 12% year-over-year and have repurchased nearly $500 million in shares over that period, further demonstrating our ability to deliver on our capital priorities. Earlier this week, we announced our quarterly dividend of $0.35 for the fourth quarter. This was the first increase to our quarterly dividend since 2022, reflecting our improved earnings power, strengthened capital position confidence in the path ahead and commitment to returning capital to shareholders. Additionally, at the end of the quarter, adjusted tangible book value per share was $41, up 5% over the past year. underscoring our continued focus on delivering long-term shareholder value. Our capital levels were influenced by rate movement during the quarter. However, the magnitude of that impact was mitigated by deliberate actions we have taken to lower our exposure to rate volatility.

Over the past several years, we proactively repositioned a portion of the securities portfolio, reinvesting into shorter duration instruments and continue to strategically hedge the balance sheet. Our strategic actions are working, resulting in a more resilient balance sheet and a more durable capital base. On Slide 9, we'll review asset quality trends. Consolidated net charge-offs of 117 basis points were up 6 basis points sequentially due to seasonality and were roughly flat year-over-year. Within retail auto, net charge-offs of 189 basis points were up 32 basis points quarter-over-quarter and roughly flat to a year ago. On the top right of the page, 30-plus all-in delinquencies of 4.96% were up 6 basis points from the prior year.

Reserve detail is included at the bottom of the page. The consolidated coverage rate of 2.49% was flat quarter-over-quarter, while retail auto coverage of 3.74% was down 1 basis point. Our coverage levels continue to balance stable credit trends across our portfolios against broader macroeconomic uncertainty. Consumers have continued to demonstrate resilience that we monitor several factors, including persistent inflation, affordability pressure, elevated oil prices and lower personal savings rate. It is important to note that our underwriting approach is not status. We continuously leverage our merchant data and insights to refine our buy box for the operating environment. We continuously curtail, reprice and made changes to automated decisioning for segments we may like Glass and vice versa.

While the portfolio is performing largely in line with our expectations, our late 2025 and early 2026 vintages are showing higher early life delinquency, which are being closely monitored. We noted a richer origination mix in 1Q in terms of yield and credit which comes with higher delinquency. The 2Q and 3Q vintages are comparatively tighter in yield and credit, which we expect to exhibit lower levels of delinquency. Vintage performance can fluctuate quarterly as we calibrate alongside evolving conditions in the market and with seasonal patterns. That is why we think it's important to look at full year vintages, which better reflect our discipline through the cycle approach. We remain confident in the buyer guide and importantly, the portfolio overall.

Moving to Slide 10 to review Auto segment highlights. Pretax income of $337 million was lower year-over-year, primarily due to CECL reserve build associated with continued strong retail assets. On the bottom line, we've highlighted the trajectory of retail oil portfolio yields. Excluding the impact from hedges, yields were slightly down quarter-over-quarter. Third quarter originated yield of 9.4% was up approximately 35 basis points quarter-over-quarter, reflecting continued pricing actions on like-for-like segments, higher benchmark rates and a modest decline in next year. We took pricing actions throughout 3Q, exiting the quarter with originated yields in the upper 9% range. On the bottom right of the page, $12.9 billion of consumer originations were up 10% year-over-year as we continue to benefit from our strategic efforts to align dealer incentives to drive record application flow.

Sustained strength in application volume remains a key competitive advantage, and we continue to believe there is runway ahead. Our expansion at the top of the funnel is providing increased opportunities to assess credit, enabling us to be selective and underwriting to optimize risk-adjusted returns. The application flow has enabled further growth in our pass-through program where we generated a second consecutive quarter with more than $1 billion of off-balance sheet origination volume. Given this momentum, we've grown our service portfolio, which contributes accretive fee income, evidenced by the 20% year-over-year increase in auto other revenue. Turning to Insurance from Slide 11. Core pretax income was $75 million up $23 million year-over-year. Total written premiums of $388 million were up $3 million year-over-year. Insurance losses of $135 million were down $6 million year-over-year.

Insurance continues to provide durable capital-efficient revenue and remains a key driver of our long-term growth strategy. We continue to leverage synergies with auto finances to sustain momentum in the business and deepen our all-in dealer value proposition, supporting our dealer partners in all aspects of their business. Turning to Corporate Finance on Slide 12. The business delivered another strong quarter with pretax income of $98 million and a 22% ROE. The team continues to demonstrate their ability to scale responsibly with the portfolio ending the quarter at $15.8 billion, up 40% over the past year. Most of the growth during the quarter was driven by existing lending relationships, and we served as lead agent on nearly 90% of the commitments originated in the quarter.

The team exercised a conservative risk management approach supported by a relationship-based model grounded in a deep understanding of our clients' businesses. We're pleased with the momentum as we leverage a consistent strategy that focuses on disciplined credit risk management and has delivered annual losses of less than 30 basis points since our IPO. The portfolio is comprised of 100% first lien senior secured floating rate loans. The power of our model is evident in the consistent credit performance of the portfolio, which remains strong and in the compelling returns delivered by the business. On Page 13, I'll conclude with a brief update on our financial outlook. With only 1 quarter remaining, we are updating our outlook to provide a more defined range while continuing to reflect our confidence in achieving or exceeding all aspects of the full year guide we laid out in January.

Despite an evolving rate environment with Fed funds expected to end the year roughly 100 basis points above our January guidance assumption as well as acute lease residual pressures throughout the year, we continue to expect NIM to remain within our initial guide and are now expecting full year NIM to fall between 3.6% and 3.65%. As we look to the fourth quarter, we see NIM around 3.7%. Turning to other revenue. We are tightening our outlook to be up 2% to 4% compared to our prior guide of flat to up 5%. Our outlook for retail NCOs remains consistent as we track toward the midpoint of our guidance range. At the consolidated level, this translates to an NCO rate at the low end of our guidance range and reflects the strong performance of our commercial portfolios.

Given our disciplined approach to expense management, adjusted noninterest expense is now expected to be flat to up 1%, slightly lower than the prior guide. Looking at growth. We've seen strong momentum in our retail auto and corporate finance originations. We are once again increasing the outlook for average earning asset growth. We now anticipate 5% to 6% growth year-over-year up from 3% to 5% previously and 2% to 4% at the start of the year. As a reminder, this growth carries CECL reserve build upfront. Our tax rate guidance remains unchanged, and we continue to expect our full year rate to land in the 20% to 22% range. In total, our focused strategy and disciplined execution continue to drive improving in operational and financial performance. While we have made significant progress, our focus remains on sustaining our momentum and executing on the meaningful opportunities ahead to deliver telling long-term value for our shareholders. And with that, I will turn it over to Dan for Q&A.

Unknown Executive

Thank you, Russ. As we head into Q&A, we do ask that participants limit yourself to 1 question and 1 follow-up. Daniel, please begin the Q&A.

Operator

[Operator Instructions] Our first question comes from Ryan Nash with Goldman Sachs.

分析师问答

Ryan Nash

Good morning, Russ. So clearly, you guys had a strong PPNR performance this quarter. However, we did see delinquencies flip from down year-over-year to up and charge-offs seem to be tracking with the middle of your guidance. Russ, I know we'll get formal guidance at some point next year, but -- maybe just talk about the pluses and minuses on credit into 2027, whether it's around the vintages. I know you highlighted pieces of late '25 and early '26 or it's other factors. And -- do you expect to make progress towards your long-term target of 1.6% to 1.8%? Or do you think we could go sideways or even increase given the recent portfolio trends.

Russell Hutchinson

Great. Thanks, Ryan. Thanks for your question. Very good question, as usual. And maybe as I start out, I just like to say, I guess, first of all, we're pleased to see the portfolio performing this year according to our expectations. We started the year, we talked about a guide of 1.8% to 2%. We're very much performing towards the middle of the guide, which is exactly where we pointed people. As you think about flow to loss and used vehicle prices, we talked earlier in the year about the support that we were getting from favorable flow to loss and strong used car prices in the market.

And we also talked at the time about the fact that we expected those factors to continue to be supportive, but less supportive as we work through the year, and that's played out pretty much as we expected. And so we talked about earlier in the year, the fact that we expected the year-over-year comparisons to look much like they did in the third quarter. with NCOs flattening out and with the possibility of delinquencies being [indiscernible]. And so as far as working soon as we see the portfolio is playing out it's playing out very much as we expected it to play out.

You mentioned vintages, and I know vintage will get a lot of attention when we release the Q in a little bit. And as we've said before, when we look at the portfolio overall, performing awarding to expectations. When we look at the '25 and '26 vintages, from a delinquency perspective, they're moving ahead of the 2024. And as we've said before, that a 2024 vintage performed better than expectation. And so we expected to see the normalization in terms of the performance of the '25 and '26 vintages. And we underwrote for that. As you look at and as we said in the prepared remarks a couple of minutes ago, if you look at the '25 and '26 vintages a little bit more closely, we are seeing elevated delinquency in kind of the late 2025 and early 2026 vintages. And I'd just remind you, we try to focus people on the annual vintages.

Quarter-to-quarter, there's a lot that goes on. And so for example, as I look at the first quarter 2026 vintage, even at the time we originated it, we talked pretty transparently about the fact that it was rich, both in terms of credit content as well as in terms of yield. When we reported back in April, we talked about a measured posture given a lot of what was going on as well as seasonal dynamics that would drive our origination mix cleaner as we move through the year. And that's certainly what played out as we move through second quarter and third quarter. And so as we look at the vintages, we understand people will spend a lot of time looking at those curves. But from our perspective, they're playing out very much as expected, just given the credit content that we have in those various vintages.

And I'd remind you, if you think about full year 2026, we very much appointed people towards the expectation that we're going to originate an ester mix that's probably in the low to mid-40s, and that's still very much our expectation. And so as we look forward, we're again pleased to see credit evolving through 2026, in line with our expectations and again, in line with the midpoint of the range that we provided back in January. Now as you pointed out, it's early to give 2027 guidance. We learned a lot as we move through the course of the fourth quarter. And as you know from prior years, we typically provide guidance early in 2027, so in January, we provide guidance for 2027 having the benefit of all the stuff that we learned going through the close out of the year. We expect to learn a lot. We're certainly not going to give 2027 guidance right now at this point. But I would say just kind of sitting here today, our expectation is for '27 to look a lot like 2026 from an NPL perspective.

Now you mentioned in your question, our origination appetite are kind of 1.6% to 1.8% range and the trajectory and the time line that moves towards that. And I just want to make sure I remind you that our approach to underwriting is pretty dynamic as you destock. And as we mentioned earlier in the prepared remarks, we're constantly looking at our origination mix and looking at our portfolio on a pretty granular segmented basis. And we're looking for pretty granular segments where we either curtail or we reprice or in some cases, we just make changes to automated decisioning in order to readjust the composition of our goal, and as we think about our risk appetite in that 1.6% to 1.8% range, I would say if you look over the course of, certainly, the later part of 2025, if you look at where we're originating today, we're very much originated towards the higher end of that appetite.

And so when I think about the trajectory to get from kind of where we're operating today in 2026 to kind of getting under -- getting into that range, we don't expect a step function change just given the proximity there. We expect it to be more of a drift. And Michael pointed this out in his remarks earlier, when we talked about a drift, it's not necessarily a straight line. We could be impacted positively or negatively in any given quarter just based on the seasoning of their vintages as well as what's playing out in the macro.

Ryan Nash

Got it. That was a great color, Russ. And -- just speaking of color, I think you gave a lot of color earlier on how to think about the impact of hikes. Obviously, expectations of rates have moved a lot with 3 more hikes in the curve. But I guess, based on what you know today, do you think the negatives over the next 4 or 5 quarters outweigh the positives. Do you expect them to take a step back before taking a step forward and then eventually making meaningful progress or can you hold the line? Maybe just discuss the key drivers and what you think it will mean for the margin over the next few quarters. .

Russell Hutchinson

It's another great question, Ryan. And I do appreciate your question seem to follow the path of your note earlier this morning that you published.

Ryan Nash

Trying to keep it simple.

Russell Hutchinson

Yes. I'm going to go back to something I said in the prepared remarks. And maybe before I start there, and maybe just to start, nothing's changed from our perspective as we think about our trajectory for the [indiscernible] but going back to my remarks more specifically and about fourth quarter, we pointed you towards an exit rate for 2026. That's around the high end of the range that we gave at the beginning of the year, the 3.6% to 3.7%. Obviously, as you pointed out, a lot has changed over the course of the year in terms of the rate trajectory. We've talked about headwinds we have related to Stellantis vehicles coming back for lease as well that certainly cost us more than a few basis points over the course of this quarter.

But again, I want to make sure you understand, when we talk about that stuff when I point you towards the high end of the range, it's not pointing towards kind of basis point precision in terms of where we expect to end up because you know as well as I do on $1.8 million of net financing revenue in a given quarter, $4 million can move us a basis point in 1 quarter. So I don't want you to put a too high degree of precision. on kind of where we are. But what I do want you to understand is the direction, right? And so as Michael pointed out earlier, this is one of those areas where it's not going to be a straight line, but the direction is pretty clear. And so when I think about the direction, the things that are driving our NIM upwards on a sustainable basis, it's really what's going on in our business on both the asset and the liability side.

The way we've remixed our liability mix towards deposits, the way that we're exercising discipline in the pricing on the deposit side of our cost -- and then it's on the asset side as we're moving our balance sheet more towards our higher earning assets. And so you've seen that strong growth in retail auto and corporate finance, continued runoff of the mortgage book as well as lower yielding legacy mortgage securities, we continue to move our balance sheet towards the place that's going to support higher net interest margin on a go-forward basis. And I don't want the quarter-to-quarter volatility or quarter-to-quarter moves of a few basis points here or there to change your perception of what's going on a longer-term basis.

I mean, if I look at 3Q '26 versus 3Q '27 and I looked at net interest margin up 34 basis points. Obviously, a lot has changed in the way we run our business and how we manage our rate risk. If I look at it in terms of risk-adjusted margin, net interest margin minus consolidated NCOs were up 67 basis points on a risk-adjusted spread basis over the course of the last 2 years. I think that's important to point out, as you think about Michael's comment earlier about the fact that it's not a straight line, but the direction is pretty clear. And I think we continue to feel pretty good about our medium-term objective of getting to a high 3s net.

Operator

Our next question comes from Rob Wildhack with Autonomous Research.

Robert Wildhack

To start on competition in retail auto, I just wonder what you're seeing there. I know some peers have called out heightened competition pressuring returns. Others have said something different. So just wanted to get your latest thoughts on how you're seeing that. and if there's any difference across income or credit cohorts? And is the competitive environment in any way, a driver in the early delinquency formation you're seeing in the late '25 and early '26 originations?

Russell Hutchinson

Great. Thanks, Rob. Great question. From a competitive perspective, we haven't -- we haven't noticed any measurable changes in the competitive dynamic. Our business continues to have a ton of traction. We've got long-standing relationships with our dealers. They have they have rewarded us through application flow. And you can see over the course of the last several quarters, we've continued to bring really strong application flow. It's allowed us to be strategic in terms of how we think about risk-adjusted return and it supported vintages in terms of size, that again, have been really strong. So we feel that the competitive dynamic continues to be favorable for us. We've certainly noticed as we look at other players have been entering and exiting as we look over the course of the last couple of years. obviously, over the course of the last quarter or 2, we've seen some folks who are pulling back somewhat.

But again, I think as we look at the competitive environment, we feel pretty good -- and I'd say maybe another proof point as we look at -- as we look at our originated yields over the course of the last couple of quarters, and over the course of third quarter, originated yield has been pretty strong. We had a pretty nice increase in originated yield going from second quarter to third quarter. But importantly, we were able to continue putting price into the market throughout the third quarter. And so if I look at where we exited the third quarter, it was at an originated yield in the high 9s above what we printed for the quarter overall. So again, for all those reasons, I continue to feel good about the petite dynamic. And I feel great about our franchise and all the work that our colleagues are dealing to maintain and to build strong relationships with our dealer partners.

Michael Rhodes

Ross, I might even double-click on this is, I mean, you look at our application flow, the strength of application flow on a year-over-year basis, yes, it's a competitive marketplace and pulp coming in and out. But we find that our dealers are doing basically more and more business with us and sans more and more volume -- and this gets to kind of a fundamental of why we like this business so much. It is 1 we're so relevant to our partners, which is important. But second, with that flow, it gives us the constant ability to reprice and tweak and understand which segments we like and which segments we like a little less and how we price. And it's just a constant opportunity to optimize the business recognized into the macro environment keeps on shifting as well it's got to optimize our underwriting to reflect that.

But just I'd underscore the attractiveness of the business that you get to reprice on a basic continual basis. with the combination of the really strong flows that we're seeing. And also, if you talk about competition, I can't help but give a shout out to our corporate finance folks and the volumes that they're seeing -- and there, again, I think there's competition in the marketplace, but we're growing with our partners. And we have the benefit there that we have a number of financial sponsors that are doing extremely well, and when those sponsors do well, we're growing with them, both in terms of velocity of transactions, the size of the transactions and we're pleased to be with them on their journey. And again, it's a competitive marketplace. But we find the places that were very relevant and we do very well there.

Robert Wildhack

Okay. And then on capital return, you've stepped up the buyback in the third quarter versus the first half, also increased the dividend, also increased the earning asset growth outlook. You've got higher rates. So just a lot of moving parts with respect to capital. And I -- the message had been low and slow, but this is kind of a less low and less slow trajectory right now. So I just wanted to get your updated thoughts there and sustaining the buyback at this pace or even increasing it. .

Russell Hutchinson

Yes. No, it's a good question, Rob. And I'd say maybe, first of all, from our perspective, nothing has changed in our approach to capital. and we very much are executing on our story of And. As you can imagine, when we restarted our share repurchase I guess, December of last year, we thought very much about just the volatility that AOCI brings to the new [indiscernible] capital requirements. And we thought about all that before we embarked on it. And that was very much why we started with our low and slow approach. And so we did feel like from the get-go we were taking our capital level in that we thought we were kind of managing around what we thought were kind of that kind of long-term kind of volatility that we'd expect in our book with AOCI and -- and also just mindful of kind of where the business is in terms of profitability and capital generation and maintaining healthy capital levels.

And so where we sit today -- as Michael pointed out, it's very much about the story of And. It's about maintaining healthy capital levels. It's about supporting the growth of our businesses and it's about returning capital to shareholders. And maybe if I double click on those a little bit. and start on the maintaining healthy capital levels. Where we sit today, we feel the heavy lifting around our capital build is behind us. Our CET1 under the current candidized approach is north of 10%. When you look at our capital from a revised standardized approach under B3 or an enhanced risk-based approach or above, and we expect that to be finalized with the transition period, but we'd expect, given where we're starting from, we'll be able to manage very nicely towards getting those capital ratios to where we want them to be.

We can effectively allow our capital to drift up. And so we sit where we think we are maintaining healthy capital levels. In terms of supporting the growth of our businesses, I think you've seen that over the course of this year as we've grown our retail auto and corporate finance book, in particular. We are not growing for the sake of growing. We're growing where we're getting accretive returns that or our profitability aspirations long term. And so again, I think we feel pretty good about our ability to support the growth of those businesses. And then you mentioned capital -- and then there's the capital return of the third piece of that.

And again, I think as you mentioned, through our share repurchase program and our dividend, we're aiming to get our capital return where we think it should be based on the profitability of the enterprise, our ability to generate capital and mindful of our need to maintain healthy capital ratios under kind of whatever the prevailing regime is going to be, whether it's current standardized approach or it's RSA or an interest-based capital.

Operator

Our next question comes from Sanjay Sakhrani with KBW.

Sanjay Sakhrani

Maybe just to go back to the credit quality questions. I guess, Michael, you've talked about this healthy paranoia about the health of the consumer. And obviously, the consumers been quite resilient and against all odds and extremely well, and that's been reflected in your credit quality. But is there anything you're seeing that gives you any pause? I mean I know these later vintages have seen slightly elevated delinquencies. Was there anything specific in the underwriting of those vintages -- that part of the vintage that kind of is creating that and maybe price for it. But maybe you could just give us a little bit more on big picture, consumer and then those specific vintages.

Russell Hutchinson

Yes. Maybe I'll kick off and then Michael, you can chime in here. I guess, first of all, I'd say, SP29093187 Credit, again, performing as expected. And so we're pleased to see that. And Sanjay, as you pointed out, consumer is resilient, and I think that's supported by what you see in terms of relatively low unemployment levels. But we're still watching. There are a number of things we're monitoring, right? And we're looking in particular at gas prices as general affordability and inflation as personal savings and real wage growth, and so we're looking at all those factors in terms of what we see. As you pointed out, we are seeing elevated delinquency in some of those kind of late '25 early '26 vintages. A lot of that, in our view, is just reflective of the credit content that's in those books.

And so nothing we're seeing gives us a ton of concern right now. But -- as you'd expect, we're watching a number of factors. And we're adjusting our underwriting on a very real-time basis. So you can rest assure that we're constantly looking through our book and picking through segments that are overperforming or underperforming relative to credit and making the adjustments that we need to make on a real-time basis. So hopefully, that gives you a sense of kind of how we're thinking about it. But those are all factors that we're looking at right now.

Michael Rhodes

And then, Russ, I might add, the higher end consumers seem to have plenty of discretionary expenses, and I think they're fueling part of the consumer economy. There is a segment of customers that are probably involved what I call kind of cash sorting. Other kind of prioritizing a triage on a monthly basis where they're putting their dollars. Against that backdrop, unemployment is quite destructive. And so we feel good about that. And as I said, the consumer has been resilient and I think I might have said it was probably close to a year ago, it's like the consumers don't read the headlines. And -- and that's so there's kind of a wall of worry, and yet the consumer keeps on being resilient through this process. And so that's kind of what we're seeing.

Sanjay Sakhrani

Well, that's great. And maybe just 1 other clarification question. Obviously, the rate outlook has changed and you guys talked a lot about it. But as we think about the originated yield that obviously saw some increase. And you guys continue to believe that, that can move higher as the rates move higher even sort of keeping the same standard of underwriting that you guys have had before? And then maybe just alongside that, a lot of discussion around agentic commerce and use, et cetera. I'm just curious, as we think about consumers having more access to information and financial alternatives, is there something we need to think about in terms of that and how Ally's positioned?

Russell Hutchinson

Sure. I didn't quite catch your originated yield question, Sanjay. And I think what you're looking at is just kind of how we think about originated yield as we see an evolving rate environment. And I think as we've said in prior discussions, when we think about pricing on the origination side, we obviously -- we look a lot at kind of where Fed funds is. We also look at swaps at the 2- and 3-year mark as we think about just how we and various competitors think about profitability of the overall portfolio -- and so I'd say, look, the changing rate environment has been constructive in terms of moving portfolio yield up, but we are very much focused on the spreads that we're getting, whether it's the Fed funds or to swaps.

And there I'd say we feel encouraged in terms of our ability to drive to maintain and to drive to potentially a stronger originated yield spread as we move forward. So again, we feel like the competitive environment, the traction that we have with dealers, the strength of our franchise are all supportive of us on the pricing side.

Michael Rhodes

And then maybe I'll touch on -- you mentioned us. and these genetic agents that are out there. Needless to say, we're spending a lot of time watching that and monitoring our activity. I think so far, the activity level, we've seen activity, but it's actually been quite low. And so I put this in the kind of monitoring and watching phase. I would underscore that there is effort that kind of we and probably many financial institutions have in educating our consumers about credential sharing and some of the risks that are associated with that. And so you imagine we'll spend some time thinking about that. But this is a watch and monitor. And I'll say the tools for price discovery or nothing new -- and so this is a watch right now.

Operator

Our next question comes from Sanjay Sakhrani with KBW. Our next question comes from Moshe Orenbuch with TD Cowen.

Moshe Orenbuch

Great. Maybe just following up on the discussion, both of the competitive environment and your pricing actions. What was interesting about the third quarter is that you had for probably the second half of the quarter, a pretty big increase in treasury yields much faster than, obviously, short-term rates. And at the very end of the quarter, kind of an increase in credit spreads. So your capital markets funded competitors, whether they're captives or securitization players probably disadvantaged. So can you talk about how much of an impact that might have had on your ability to take price both in Q3 and kind of going forward? It seems like it should be constructive.

Russell Hutchinson

Yes. It's certainly constructive. And I think even kind of beyond near-term rate moves, I feel like our platform is advantaged based on the strength of our relationships. I would say, as you think about it, as you think about kind of pricing in the industry generally, I guess, number one, I think the capital markets anticipated certainly, some of what we saw in rates in terms of the swap markets have been moving all year long, effectively. And I think as we think about some of our competitors, they're not -- they may not be as quick to react as you might tend -- so I think we got a lot of support just from the strength of the franchise. I do think the changing rate environment is also constructive for us from a pricing perspective, but again, it doesn't take the pressure off of us to aggressively invest in our relationships and to manage our business and to exercise discipline as we go to market every week.

Michael Rhodes

If you think how the quarter unfolded. I mean, the premise of the question is, look, we were pleased with our ability to put rate into the marketplace during the quarter.

Moshe Orenbuch

Just on the -- you mentioned at the beginning of your remarks, Russ, that the big charge essentially related to growth and CECL. Is there a way to kind of think about some of your off-balance sheet activities kind of in ways to somewhat mitigate that? And maybe just if you could kind of just give us a little bit of a description of what your thoughts are between whether it's CRT transactions and how to think about kind of pass-through volume and those factors as we move forward.

Russell Hutchinson

That's a great question, Josh. As you've noticed, over the course of the last couple of years, Yes, we've been more opportunistic about the way that we manage the capital intensity of our auto business. And so you mentioned the CRT. We are the largest North American retail auto CRT that we're aware of in the third quarter. Yes, that's been a great way for us to manage the capital intensity of the business. the capital release that the CRT provides has traded effectively an attractive source of capital at augmenting the returns of our business. Pass-through is another area you mentioned, we mentioned a few minutes ago. We had another quarter of $1 billion plus of pass-through volume. That volume that doesn't pay our balance sheet. And so it's clearly off balance sheet.

And it's a great source of fee income. We get a fee at origination and we've got servicing fees on a go-forward basis. It's also a great way to support our dealers to augment our own credit box by helping our dealers effectively sell more vehicles. And look, we're opportunistic, and we're always kind of looking for ways to think about capital in an opportunistic way. I think you probably remember a couple of years ago, we took some of our existing securitizations and we sold through the capital structure to achieve true sale. So we're able to basically book the sale of loans through the ABS market. And so that's -- yes, so we look at a number of different opportunities from time to time in terms of looking for the most efficient way to manage our capital to lessen the capital intensity of the auto business and also to improve our returns.

Michael Rhodes

And then just saying the obvious, there's obviously a build from CECL when it comes with the strong growth we've had. We like the business we're originating. And so this will pay dividends down.

Operator

Our next question comes from Jeff Adelson with Morgan Stanley.

Jeffrey Adelson

Just maybe wanted to understand -- I appreciate all the comments around NIM and yields from here and you're exiting the quarter at a high 9% originated yield. I guess -- as we think about this migration higher over time, how do we think about the near-term trajectory? I mean I think -- if I have it correct, about 3 years ago, you were originating more in the 10.5% to 11%. So is there maybe a little bit more -- is this more of a backloaded '27 type migration as you sort of still have to burn off the higher-yielding loans for a few years ago? Or just us understand that trajectory a little bit from here and maybe the opportunity to continue migrating higher.

Russell Hutchinson

It's a great question, Jeff. I think 1 of the things that we haven't focused on so far is originated yield to portfolio yield. And as you saw in the third quarter, the portfolio yield actually came down a touch at hedged to 9.2%. And that portfolio yield at any given point in time, it reflects the seasoning of various vintages that are on the book, what's kind of coming off and what's coming off the book and what's going on in the book in terms of what we originate and given where with the momentum that we have right now on originated yield and kind of what you saw in the third quarter, our expectation is that portfolio yield is going to drift off. as we've been forward. Now again, don't expect any step function changes in portfolio yield. Think about more of a drift, but just as it's kind of drifted a little down, we do expect that over the next few quarters, it ought to drift upwards as we get the benefit of some of these quarterly vintages of the higher yield.

Jeffrey Adelson

Okay. Okay. Great. And just in terms of deposit betas, I don't think we've really touched on that yet. Is your expectation still that you'll end up somewhere, I think you talked about a cumulative beta around 70% in prior cycles. Is there anything that would be different about this cycle, whether it be a agentic, deposit competition, just how you're thinking about that impact? And I know you've also talked a bit about the tail benefit of CDs repricing into your liquid deposits in the area. Is that happening anymore? Or is there still a little bit of a tailwind from that dynamic? Or is that largely gone just given where you're putting new CDs out there in the current market?

Russell Hutchinson

Yes. Thanks, Jeff. They're another good question. On the deposit base, I think previously, certainly, as we were moving through the rate reduction cycle, we talked about betas in the 60% to 70% range. And obviously, if you look over the course of the recent rate reduction cycle, we achieved a stay that was right about the 70% mark -- and that's a reflection of just a tremendous amount of discipline on our price in terms of how we approach pricing. And so as rates came down, you saw a number of circumstances where we were the leaders in the market in terms of bringing our rates down. And that speaks to the strength of our franchise, right? And we understand rate is important, we certainly expect, and we'll have competitive rates, but we also have a great product offering a great digital experience and a fantastic brand that our customers engage with, and so that strength of our overall franchise has allowed us and support it our discipline on the pricing side, certainly as rates came down.

And so where will operate towards the favorable end of that 60% to 70% range as rates were coming down. As we look forward and we see an environment now where rates are moving in the other direction. Yes, I think it's our expectation that it's in that 60% to 70% range. And that discipline that we've established applies in the other direction as well. So we're not anticipating kind of any changes to our approach there. Michael will make some comments earlier on agentic in terms of customers and the kind of price shopping, that's not new to us. That's the world we live in, and we run our business with the expectation that we need to maintain competitive rates as well as an overall an attractive customer value proposition. And that's how we run our business. And right now, when I look at how we show up through AI search, we actually show a in a pretty favorable way relative to others in terms of how we show up on AI search.

And we don't lead the market right now on pricing. We're competitive, but we don't lead the market in we still -- we continue to feel really good about our customer growth and our ability to attract and onboard attractive customers, particularly in the millennial and generation Z cohort. So again, we feel pretty good, and we don't think there's any kind of step function change happening in terms of how we price or how we run that part of the business.

Operator

And our final question comes from Don Fandetti with Wells Fargo.

Donald Fandetti

Yes. Can you talk a little bit about expenses in the context of tech and AI? I mean really then kept the check on expenses over the last few years, but banks are spending a lot. I was just curious how you're thinking about that as you look into next year and beyond.

Michael Rhodes

Maybe Russell might jump on this one. Look, we've been really pleased with our discipline in our expense management. And you've seen that over the last several years. And we're getting here through, I think, this really strong on operational management. We're being very disciplined about how we actually run our operations about how we see staff things, a lot of salary dollars, obviously, but also third-party vendors and the way we actually use them. And again, the word I used there is just good operational discipline. That being the case, don't mistake this operational discipline for a lack of investing in things that are required. .

And so as I think about this year, even underneath the expense investments that you've seen, we've actually increased our spending in marketing. We've increased our spending in technology. As we look forward, we continue to see that. And we're funding the things that we think we need to fund in this environment to protect the business and to enable it in an AI-first world that we tend to be going into -- and so we talk a lot about And versus Or narrative related to capital. I'd actually use that the way we think about expenses as well. We're being both efficient with how we spend our dollars. But we're also investing in things that were in the areas we need to invest in. And if you actually just look at our volume growth is kind of evidence of that. And so expense of roughly flat year-over-year. And our corporate finance loans are up 40%.

Our auto originations were up 10%. In the consumer bank, our net customer growth was 7% year-over-year. And if you look over time that number is actually accelerating it was, call it, 12% -- sorry, it was 12% for 2 years and 7% over last year so you see an acceleration where you get that acceleration through incremental investment. And so very pleased with the operating leverage that we're generating. And so again, I take this kind of And versus Or narrative on capital and think about the way we're actually investing in the platform. And I might actually -- if you don't mind, take this is just a moment to reflect on some of the comments I made at the beginning of the call reflected over the past 2 years, what's going on with the business. And auto and corporate finance loans are up 15% over that period of time. I talked about the consumer growth Revenue is up 12% with expenses almost flat during that period of time and earnings have more than doubled ROTC is up more than 100 basis points to 13.1%.

And we've done all that against the backdrop of a continually changing operating environment. And so what's important isn't really just the progress we've made, but it's really what's underneath in the how -- and it's really about stronger franchise, improved economics and discipline as it relates to risk and capital and expenses. And so next quarter, NIM can do this or that or losses can go in different places, but expect that disciplined approach to capital expense management to continue and risk management. And look, we expect that to translate into a better performing business on a go-forward basis.

Unknown Executive

Awesome. Well, thank you, Michael. I see we're a little past the top of the hour. That's all the time we have for today. If you do have any additional questions, please reach out to Investor Relations. Thanks for joining us this morning. That concludes today's call.

Operator

Goodbye. This concludes today's conference call. Thank you for participating. You may now disconnect.

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