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Christopher Menkin
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Christopher "Kit" Menkin is of editor (, an internet trade publication for the finance/leasing industry. He has 46 years experience in the finance/leasing industry as well as being a founder of a commercial regional bank and serving on several company... More
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  • Top Auto Lenders Largely In Neutral In Q1 0 comments
    Jun 20, 2013 12:26 PM

    By David Hayes and Tyler Hall, SNL Financial

    (click to enlarge)

    Auto loans at the U.S.'s largest depository auto lenders took what could be likened to a caution lap in the first quarter. Total auto loans at the top 100 increased by only 0.64% over the fourth quarter of 2012, and the top 16 lenders remained in the exact same order as a quarter earlier. These 100 institutions held $395.33 billion in auto loans at March 31, compared to $392.80 billion at year-end 2012.

    First-place Ally Financial Inc. saw its auto loans fall by 6.73% in the first quarter yet still boasted more than $13 billion more auto loans than any other U.S. depository. Ally's auto loans fell to $60.41 billion at the end of the first quarter, down from $64.77 billion at year-end 2012 and $61.22 billion in the year-ago quarter. However, Ally's auto loans past due or in nonaccrual status fell to 2.14% at quarter-end from 2.36% at the end of last year, but that was an increase from 1.48% in the year-ago quarter.

    The auto loan giant completed the sale of its Canadian auto finance operations to Toronto-based Royal Bank of Canada earlier this year. On June 3, Ally announced that it had completed the sale of its European operations, mostly in France, to General Motors Financial Co. Inc. Ally's sale of its operations in Germany, the United Kingdom, Austria, Italy, Switzerland, Sweden, Belgium, the Netherlands, Mexico, Chile and Columbia was completed earlier, according to an April 2 press release.

    Capital One Financial Corp. extended its lead over fifth-place Bank of America Corp., a quarter after overtaking BofA. Capital One managed to grow its auto loans by 3.01% over the fourth quarter of 2012 and 18.55% over the year-ago quarter. The company's past-due and nonaccrual loans shrank significantly in the first quarter, accounting for only 5.93% of total loans compared to 7.56% at year-end 2012.

    BB&T Corp. grew its auto loans by 3.50% in the first quarter to $9.33 billion, compared to $9.02 billion in the fourth quarter of 2012. During the company's first-quarter earnings conference call, Kelly King, BB&T's chairman and CEO, noted that auto demand had improved significantly and that the company expects double-digit growth in the second quarter. Clarke Starnes, the company's chief risk officer, mentioned that while BB&T is not deviating from its underwriting, it is seeing other competitors extend terms and increase advance rates, much like what was seen in earlier credit cycles.

    Navy Federal Credit Union, by far the country's largest credit union, posted $7.27 billion in auto loans at the end of the first quarter, up 5.15% from the end of 2012. Of the 100 largest depository auto lenders, 43 were banks or thrifts, while 57 were credit unions as of March 31.

    (click to enlarge)

    Disclosure: I have no positions in any stocks mentioned, and no plans to initiate any positions within the next 72 hours.

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