Ally Financial Inc. on Wednesday reported a third-quarter profit of $269 million, its third consecutive quarter in the black, driven by strong results in both its automotive and mortgage units.

A year earlier, Ally, formerly known as GMAC, lost $767 million.

The company's core business, which finances sales of vehicles made by former parent General Motors, Chrysler, Saab and the recreational-vehicle maker Thor Industries, reported its seventh consecutive profitable quarter, with third-quarter income of $756 million, up from $412 million a year earlier.

Ally's mortgage operations, which include Residential Capital LLC, posted pretax income of $154 million, compared with a loss of $652 million a year earlier.

Ally said it had strong production profits and margins including a lower loan loss provision and gains on sale of legacy mortgage assets.

But Ally increased its reserve for mortgage repurchases to $1.1 billion, which resulted in a $344 million pretax expense in the quarter. The increase in reserves was based on observed losses, modeled projections of vintage delinquencies, repurchase rates and loss severity, Ally said.

"Trends in repurchase claims and ongoing dialogue with counterparties also factored into reserve calculations," the company said in a press release.

Deposits at Ally's banking subsidiaries in the U.S. and Canada grew 7% from the second quarter and 29% from a year earlier to $36.9 billion.

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