Consumer lending

The Detroit lender will take a first-quarter hit due to a latest balance sheet restructuring, but said the play should boost profitability in the long term.

Serious delinquencies on auto loans rose to almost 3% in the fourth quarter of 2024, according to the New York Fed. Researchers blame the affordability problem on soaring car prices.

Founder Ken LaRoe says his decision to step back from daily management chores will help the Orlando, Florida-based Climate First Bancorp maintain its independence.

The Consumer Financial Protection Bureau found that auto lenders' use of reposession agents spiked to nearly 70% in 2022, up from 31% in 2018, resulting in higher costs for consumers.

The auto lender is selling its credit card business and halting new mortgage loans, abandoning its once-broader ambitions. Ally CEO touted the move as "the power of focus."

CEO Richard Fairbank told analysts executives have their "microscopes" out for any signs of trouble, but consumers remain "in a great place."

The Alabama-based regional bank reported stronger earnings on a bump in capital markets fee revenue and lower expenses, but its total loans declined and its charge-offs increased. It expects only modest loan growth this year.

The Consumer Financial Protection Bureau's research found that the majority of buy now/pay later users are subprime borrowers, holding high credit card balances and multiple loans, suggesting the offering is riskier to lenders than previously assumed.

Debt collection trade group ACA International and Specialized Collections Systems, a Houston-based debt collector, filed a lawsuit against the Consumer Financial Protection Bureau alleging its medical debt rule is outside its authority.

The industry should save on interest expenses this year as it follows the Fed's lead in cutting rates. The downside is that the lower deposit rates signal fewer opportunities to make loans.