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Amid headlines about foreclosure "robo-signings" and representation-and-warranty disputes involving its Residential Capital LLC mortgage unit, Ally Financial Inc. continues to make its mark in the Internet banking business with high-yield savings products and a checking account that remains free of fees in an era in which such a product offering has been declared all but dead by some brick-and-mortar competitors.
Midvale, Utah-based Ally Bank had total domestic deposits of $33.71 billion as of Sept. 30, according to SNL's bank regulatory data, up from $31.89 billion as of June 30 and $33.04 billion as of the same date in 2009. The regulatory figures differ from those disclosed publicly by Ally Financial in that they exclude deposits attributable to ResMor Trust Co. Ally Financial reported Nov. 3 that third-quarter retail deposits at Ally Bank totaled $20.50 billion, up from $18.69 billion in the second quarter and $15.89 billion in the year-earlier period.
"If you have to pay the penalty of being a bank, which is hugely expensive, then you might as well have the advantage of being a bank," Ally Financial CEO Michael Carpenter said on a Nov. 3 conference call. "The biggest advantage of being a bank is deposits, and I'm pleased to say that ... [deposits are] 29% of our total funding, and we look forward to gaining ground on that front." Deposits accounted for only 5% of the fourth-quarter 2006 funding base of what was then the largely wholesale-funded GMAC, reported Ally Financial, which is converting to a bank holding company from a finance company.
The competitiveness of Ally...