Edgar Filing: Ally Financial Inc.

Form 10-Q

UNITED STATES SECURITIES AND EXCHANGE COMMISSION

Washington, D.C. 20549

FORM 10-Q

þ	QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934

For the quarterly period ended September 30, 2010, or

¨	TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934

For the transition period from to .

Commission file number: 1-3754

ALLY FINANCIAL INC.

(Exact name of registrant as specified in its charter)


Delaware		38-0572512
(State or other jurisdiction of incorporation or organization)		(I.R.S. Employer Identification No.)

200 Renaissance Center

P.O. Box 200, Detroit, Michigan

48265-2000

(Address of principal executive offices)

(Zip Code)

(866) 710-4623

(Registrant’s telephone number, including area code)

Indicate by check mark whether the registrant (1) has filed all reports required to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during the preceding 12 months, and (2) has been subject to such filing for the past 90 days.

Yes þ No ¨

Indicate by checkmark whether the registrant has submitted electronically and posted on its corporate Web site, every Interactive Data File required to be submitted and posted pursuant to Rule 405 of Regulation S-T (§232.405 of this chapter) during the preceding 12 months (or for a shorter period that the registrant was required to submit and post such files).

Yes ¨ No ¨

Indicate by check mark whether the registrant is a large accelerated filer, an accelerated filer, a nonaccelerated filer, or a smaller reporting company. See the definitions of “large accelerated filer,” “accelerated filer,” and “smaller reporting company” in Rule 12b-2 of the Exchange Act. (Check one):


Large accelerated filer ¨	Accelerated filer ¨	Non-accelerated filer þ	Smaller reporting company ¨
		(Do not check if a smaller reporting company)

Indicate by check mark whether the registrant is a shell company (as defined in Rule 12b-2 of the Exchange Act).

Yes ¨ No þ

At November 8, 2010, the number of shares outstanding of the Registrant’s common stock was 799,120 shares.

ALLY FINANCIAL INC.

INDEX


		Page
Part I — Financial Information
Item 1.	Financial Statements		3
	Condensed Consolidated Statement of Income (unaudited) for the Three and Nine Months Ended September 30, 2010 and 2009		3
	Condensed Consolidated Balance Sheet (unaudited) at September 30, 2010, and December 31, 2009		4
	Condensed Consolidated Statement of Changes in Equity (unaudited) for the Nine Months Ended September 30, 2010 and 2009		6
	Condensed Consolidated Statement of Cash Flows (unaudited) for the Nine Months Ended September 30, 2010 and 2009		8
	Notes to Condensed Consolidated Financial Statements (unaudited)		10
Item 2.	Management’s Discussion and Analysis of Financial Condition and Results of Operations		78
Item 3.	Quantitative and Qualitative Disclosures About Market Risk		130
Item 4.	Controls and Procedures		130
Part II — Other Information
Item 1.	Legal Proceedings		131
Item 1A.	Risk Factors		131
Item 2.	Unregistered Sales of Equity Securities and Use of Proceeds		133
Item 3.	Defaults Upon Senior Securities		133
Item 4.	(Removed and Reserved)		133
Item 5.	Other Information		133
Item 6.	Exhibits		133
Signatures			134
Index of Exhibits			135

PART I — FINANCIAL INFORMATION

Item 1. Financial Statements

ALLY FINANCIAL INC.

CONDENSED CONSOLIDATED STATEMENT OF INCOME (unaudited)


	Three months ended September 30,						Nine months ended September 30,
($ in millions)	2010			2009			2010			2009
Financing revenue and other interest income
Finance receivables and loans
Consumer	$	1,149		$	1,124		$	3,407		$	3,532
Commercial		470			407			1,361			1,259
Notes receivable from General Motors		40			55			135			144

Total finance receivables and loans		1,659			1,586			4,903			4,935
Loans held-for-sale		153			114			524			282
Interest on trading securities		5			62			12			119
Interest and dividends on available-for-sale investment securities		88			49			279			162
Interest-bearing cash		22			19			54			88
Other interest income, net		—			1			—			56
Operating leases		855			1,386			3,029			4,491

Total financing revenue and other interest income		2,782			3,217			8,801			10,133
Interest expense
Interest on deposits		172			178			485			535
Interest on short-term borrowings		110			121			322			464
Interest on long-term debt		1,451			1,449			4,295			4,685

Total interest expense		1,733			1,748			5,102			5,684
Depreciation expense on operating lease assets		454			894			1,636			3,007

Net financing revenue		595			575			2,063			1,442
Other revenue
Servicing fees		404			379			1,173			1,176
Servicing asset valuation and hedge activities, net		(27	)		(110	)		(181	)		(687	)

Total servicing income, net		377			269			992			489
Insurance premiums and service revenue earned		470			510			1,415			1,501
Gain on mortgage and automotive loans, net		326			177			863			666
(Loss) gain on extinguishment of debt		(2	)		10			(123	)		667
Other gain on investments, net		104			216			339			299
Other income, net of losses		181			229			456			(94	)

Total other revenue		1,456			1,411			3,942			3,528
Total net revenue		2,051			1,986			6,005			4,970
Provision for loan losses		9			680			375			2,543
Noninterest expense
Compensation and benefits expense		393			416			1,208			1,170
Insurance losses and loss adjustment expenses		229			254			664			800
Other operating expenses		1,094			1,496			2,805			3,577

Total noninterest expense		1,716			2,166			4,677			5,547
Income (loss) from continuing operations before income tax expense (benefit)		326			(860	)		953			(3,120	)
Income tax expense (benefit) from continuing operations		48			(291	)		117			681

Net income (loss) from continuing operations		278			(569	)		836			(3,801	)

(Loss) income from discontinued operations, net of tax		(9	)		(198	)		160			(1,544	)

Net income (loss)	$	269		$	(767	)	$	996		$	(5,345	)

The Notes to the Condensed Consolidated Financial Statements (unaudited) are an integral part of these statements.

ALLY FINANCIAL INC.

CONDENSED CONSOLIDATED BALANCE SHEET (unaudited)


($ in millions)	September 30, 2010			December 31, 2009
Assets
Cash and cash equivalents
Noninterest-bearing	$	1,414		$	1,840
Interest-bearing		11,175			12,948

Total cash and cash equivalents		12,589			14,788
Trading securities		211			739
Investment securities
Available-for-sale		11,925			12,155
Held-to-maturity		—			3

Total investment securities		11,925			12,158
Loans held-for-sale, net ($6,978 and $5,545 fair value elected)		13,265			20,625
Finance receivables and loans, net
Consumer ($2,948 and $1,303 fair value elected)		60,185			42,849
Commercial		38,050			33,941
Notes receivable from General Motors		483			911
Allowance for loan losses		(2,054	)		(2,445	)

Total finance receivables and loans, net		96,664			75,256
Investment in operating leases, net		10,213			15,995
Mortgage servicing rights		2,746			3,554
Premiums receivable and other insurance assets		2,169			2,720
Other assets		21,817			19,887
Assets of operations held-for-sale		1,592			6,584

Total assets	$	173,191		$	172,306

Liabilities
Deposit liabilities
Noninterest-bearing	$	2,547		$	1,755
Interest-bearing		35,410			30,001

Total deposit liabilities		37,957			31,756
Debt
Short-term borrowings		5,914			10,292
Long-term debt ($2,793 and $1,293 fair value elected)		87,547			88,021

Total debt		93,461			98,313
Interest payable		1,824			1,637
Unearned insurance premiums and service revenue		2,937			3,192
Reserves for insurance losses and loss adjustment expenses		922			1,215
Accrued expenses and other liabilities		14,370			10,456
Liabilities of operations held-for-sale		743			4,898

Total liabilities		152,214			151,467
Equity
Common stock and paid-in capital		13,838			13,829
Preferred stock held by U.S. Department of Treasury		10,893			10,893
Preferred stock		1,287			1,287
Accumulated deficit		(5,480	)		(5,630	)
Accumulated other comprehensive income		439			460

Total equity		20,977			20,839

Total liabilities and equity	$	173,191		$	172,306

ALLY FINANCIAL INC.

CONDENSED CONSOLIDATED BALANCE SHEET (unaudited)

The assets of consolidated variable interest entities that can be used only to settle obligations of the consolidated variable interest entities and the liabilities of these entities for which creditors (or beneficial interest holders) do not have recourse to our general credit at September 30, 2010, were as follows.


($ in millions)
Assets
Cash and cash equivalents
Noninterest-bearing	$	3
Loans held-for-sale, net		34
Finance receivables and loans, net
Consumer ($2,948 fair value elected)		19,568
Commercial		12,190
Allowance for loan losses		(262	)

Total finance receivables and loans, net		31,496
Investment in operating leases, net		1,803
Other assets		4,718
Assets of operations held-for-sale		86

Total assets	$	38,140

Liabilities
Debt
Short-term borrowings	$	1,265
Long-term debt ($2,793 fair value elected)		26,976

Total debt		28,241
Interest payable		28
Accrued expenses and other liabilities		551
Liabilities of operations held-for-sale		48

Total liabilities	$	28,868

The Notes to the Condensed Consolidated Financial Statements (unaudited) are an integral part of these statements.

ALLY FINANCIAL INC.

CONDENSED CONSOLIDATED STATEMENT OF CHANGES IN EQUITY (unaudited)

Nine Months Ended September 30, 2010 and 2009


($ in millions)	Members’ interests		Preferred interests held by U.S. Department of Treasury		Preferred interests		Retained earnings			Accumulated other comprehensive (loss) income			Total equity			Comprehensive (loss) income
Balance at January 1, 2009	$	9,670	$	5,000	$	1,287	$	6,286		$	(389	)	$	21,854
Capital contributions (a)		1,247												1,247
Net loss								(4,578	)					(4,578	)	$	(4,578	)
Preferred interests dividends paid to the U.S. Department of Treasury								(160	)					(160	)
Preferred interests dividends								(195	)					(195	)
Dividends to members (a)								(119	)					(119	)
Issuance of preferred interests held by U.S. Department of Treasury				7,500										7,500
Other comprehensive income											497			497			497

Balance at June 30, 2009, before conversion from limited liability company to a corporation (b)	$	10,917	$	12,500	$	1,287	$	1,234		$	108		$	26,046		$	(4,081	)


($ in millions)	Common stock and paid-in capital		Preferred stock held by U.S. Department of Treasury		Preferred stock		Retained earnings (accumulated deficit)			Accumulated other comprehensive income		Total equity			Comprehensive (loss) income
Balance at June 30, 2009, after conversion from limited liability company to a corporation	$	10,917	$	12,500	$	1,287	$	1,234		$	108	$	26,046		$	(4,081	)
Net loss								(767	)				(767	)		(767	)
Preferred stock dividends paid to the U.S. Department of Treasury								(271	)				(271	)
Preferred stock dividends (a)								(103	)				(103	)
Dividends to shareholders (a)								(260	)				(260	)
Other comprehensive income											296		296			296

Balance at September 30, 2009	$	10,917	$	12,500	$	1,287	$	(167	)	$	404	$	24,941		$	(4,552	)

ALLY FINANCIAL INC.

CONDENSED CONSOLIDATED STATEMENT OF CHANGES IN EQUITY (unaudited)

Nine Months Ended September 30, 2010 and 2009


($ in millions)	Common stock and paid-in capital		Preferred stock held by U.S. Department of Treasury		Preferred stock		Accumulated deficit			Accumulated other comprehensive income			Total equity			Comprehensive income (loss)
Balance at January 1, 2010, before cumulative effect of adjustments	$	13,829	$	10,893	$	1,287	$	(5,630	)	$	460		$	20,839
Cumulative effect of a change in accounting principle, net of tax (c)								(57	)		4			(53	)

Balance at January 1, 2010, after cumulative effect of adjustments	$	13,829	$	10,893	$	1,287	$	(5,687	)	$	464		$	20,786
Capital contributions		9												9
Net income								996						996		$	996
Preferred stock dividends paid to the U.S. Department of Treasury								(643	)					(643	)
Preferred stock dividends (a)								(212	)					(212	)
Dividends to shareholders (a)								(8	)					(8	)
Other comprehensive loss											(25	)		(25	)		(25	)
Other (d)								74						74

Balance at September 30, 2010	$	13,838	$	10,893	$	1,287	$	(5,480	)	$	439		$	20,977		$	971

(a)	Refer to Note 18 to the Condensed Consolidated Financial Statements for further details.

(b)

Effective June 30, 2009, we converted from a Delaware limited liability company into a Delaware corporation. Each unit of each class of common membership interest issued and outstanding immediately prior to the conversion was converted into an equivalent number of shares of common stock with substantially the same and preferences as the common membership interests. Upon conversion, holders of our preferred membership interests also received an equivalent number of preferred stock with substantially the same rights and preferences as the former preferred membership interests.

(c)

Cumulative effect of change in accounting principle, net of tax, due to adoption of ASU 2009-16, Accounting for Transfers of Financial Assets, and ASU 2009-17, Improvements to Financial Reporting by Enterprises Involved with Variable Interest Entities. Refer to Note 1 for additional information.

(d)

Represents a reduction of the estimated payment accrued for tax distributions as a result of the completion of the GMAC LLC U.S. Return of Partnership Income for the tax period January 1, 2009, through June 30, 2009. Refer to Note 18 to the Condensed Consolidated Financial Statements for further details.

The Notes to the Condensed Consolidated Financial Statements (unaudited) are an integral part of these statements.

ALLY FINANCIAL INC.

CONDENSED CONSOLIDATED STATEMENT OF CASH FLOWS (unaudited)


Nine months ended September 30, ($ in millions)	2010			2009
Operating activities
Net income (loss)	$	996		$	(5,345	)
Reconciliation of net income (loss) to net cash provided by operating activities
Depreciation and amortization		3,246			4,746
Operating lease impairment		—			(117	)
Impairment of goodwill and other intangible assets		—			641
Other impairment		58			226
Amortization and valuation adjustments of mortgage servicing rights		1,466			191
Provision for loan losses		397			2,712
Gain on sale of loans, net		(861	)		(43	)
Net gain on investment securities		(357	)		(22	)
Loss (gain) on extinguishment of debt		123			(667	)
Originations and purchases of loans held-for-sale		(48,828	)		(47,775	)
Proceeds from sales and repayments of loans held-for-sale		55,046			42,387
Net change in:
Trading securities		(22	)		310
Deferred income taxes		(186	)		893
Interest payable		176			197
Other assets		976			5,738
Other liabilities		698			(874	)
Other, net		(1,388	)		(1,246	)

Net cash provided by operating activities		11,540			1,952

Investing activities
Purchases of available-for-sale securities		(15,902	)		(17,288	)
Proceeds from sales of available-for-sale securities		13,380			6,669
Proceeds from maturities of available-for-sale securities		3,646			3,282
Net (increase) decrease in finance receivables and loans		(12,423	)		9,813
Proceeds from sales of finance receivables and loans		2,554			457
Change in notes receivable from GM		1			751
Purchases of operating lease assets		(2,405	)		(465	)
Disposals of operating lease assets		6,719			4,894
(Purchases) sales of mortgage servicing rights, net		(45	)		7
Sale of business unit, net (a)		(331	)		96
Other, net		1,203			485

Net cash (used in) provided by investing activities		(3,603	)		8,701

ALLY FINANCIAL INC.

CONDENSED CONSOLIDATED STATEMENT OF CASH FLOWS (unaudited)


Nine months ended September 30, ($ in millions)	2010			2009
Financing activities
Net change in short-term debt		(4,856	)		(919	)
Net increase in bank deposits		4,776			8,132
Proceeds from issuance of long-term debt		32,235			23,851
Repayments of long-term debt		(43,827	)		(51,000	)
Proceeds from issuance of preferred stock held by U.S. Department of Treasury		—			7,500
Proceeds from issuance of common stock		—			1,247
Dividends paid		(862	)		(1,082	)
Other, net		1,255			1,282

Net cash used in financing activities		(11,279	)		(10,989	)
Effect of exchange-rate changes on cash and cash equivalents		501			(28	)

Net decrease in cash and cash equivalents		(2,841	)		(364	)
Adjustment for change in cash and cash equivalents of operations held-for-sale (a) (b)		642			(562	)
Cash and cash equivalents at beginning of year		14,788			15,151

Cash and cash equivalents at September 30,	$	12,589		$	14,225

Supplemental disclosures
Cash paid for
Interest	$	4,055		$	4,923
Income taxes		377			274
Noncash items
Increase in finance receivables and loans due to a change in accounting principle (c)		17,990			—
Increase in long-term debt due to a change in accounting principle (c)		17,054			—
Loans held-for-sale transferred to finance receivables and loans		37			803
Finance receivables and loans transferred to loans held-for sale		596			1,421
Finance receivables and loans transferred to other assets		187			406
Originations of mortgage servicing rights from sold loans		628			586
Other disclosures
Proceeds from sales and repayments of mortgage loans held-for-investment originally designated as held-for-sale		437			697
Proceeds from sales of repossessed, foreclosed, and owned real estate		396			923
Consolidation of loans, net		—			1,410
Consolidation of collateralized borrowings		—			1,184

(a)	The amounts for the nine months ended September 30, 2010, are net of cash and cash equivalents of $1.1 billion of business units at the time of disposition.

(b)	Cash flows of operations held-for-sale are reflected within operating, investing, and financing activities in the Condensed Consolidated Statement of Cash Flows. The cash balance of these operations are reported as assets of operations held-for-sale on the Condensed Consolidated Balance Sheet.

(c)	Relates to the adoption of ASU 2009-16, Accounting for Transfers of Financial Assets, and ASU 2009-17, Improvements to Financial Reporting by Enterprises Involved with Variable Interest Entities. Refer to Note 1 for additional information.

The Notes to the Condensed Consolidated Financial Statements (unaudited) are an integral part of these statements.

ALLY FINANCIAL INC.

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS (unaudited)

1.	Description of Business, Basis of Presentation, and Changes in Significant Accounting Policies

Ally Financial Inc. (formerly GMAC Inc. and referred to herein as Ally, we, our, or us) is one of the world's largest automotive financial services companies. On December 24, 2008, we became a bank holding company under the Bank Holding Company Act of 1956, as amended. Our primary banking subsidiary is Ally Bank, which is an indirect wholly owned subsidiary of Ally Financial Inc.

Our accounting and reporting policies conform to accounting principles generally accepted in the United States of America (GAAP). Additionally, where applicable, the policies conform to the accounting and reporting guidelines prescribed by bank regulatory authorities. The preparation of financial statements in conformity with GAAP requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities at the date of the financial statements and that affect income and expenses during the reporting period. In developing the estimates and assumptions, management uses all available evidence; however, actual results could differ because of uncertainties associated with estimating the amounts, timing, and likelihood of possible outcomes.

The Condensed Consolidated Financial Statements at September 30, 2010, and for the three months and nine months ended September 30, 2010 and 2009, are unaudited but reflect all adjustments that are, in management's opinion, necessary for the fair presentation of the results for the interim periods presented. All such adjustments are of a normal recurring nature. These unaudited Condensed Consolidated Financial Statements should be read in conjunction with the audited Consolidated Financial Statements (and the related notes) included in our Annual Report on Form 10-K for the year ended December 31, 2009, as filed on February 26, 2010, with the U.S. Securities and Exchange Commission (SEC), as amended by the Current Report on Form 8-K filed with the SEC on October 12, 2010.

Residential Capital, LLC

Residential Capital, LLC (ResCap), one of our mortgage subsidiaries, was negatively impacted by the events and conditions in the mortgage banking industry and the broader economy. The market deterioration led to fewer sources of, and significantly reduced levels of, liquidity available to finance ResCap’s operations. ResCap is highly leveraged relative to its cash flow and previously recognized credit and valuation losses resulting in a significant deterioration in capital. ResCap’s consolidated tangible net worth, as defined, was $859 million at September 30, 2010, and ResCap remained in compliance with all of its consolidated tangible net worth covenants. For this purpose, consolidated tangible net worth is defined as ResCap’s consolidated equity excluding intangible assets. There continues to be a risk that ResCap may not be able to meet its debt service obligations, may default on its financial debt covenants due to insufficient capital, and/or may be in a negative liquidity position in 2010 or future periods.

ResCap actively manages its liquidity and capital positions and is continually working on initiatives to address its debt covenant compliance and liquidity needs including debt maturing in the next twelve months and other risks and uncertainties. ResCap’s initiatives could include, but are not limited to, the following: continuing to work with key credit providers to optimize all available liquidity options; possible further reductions in assets and other restructuring activities; focusing production on government and prime conforming products; exploring strategic alternatives such as alliances, joint ventures, and other transactions with third parties with respect to certain ResCap assets and businesses; and continued exploration of opportunities for funding and capital support from Ally and its affiliates. The outcomes of most of these initiatives are to a great extent outside of ResCap’s control resulting in increased uncertainty as to their successful execution.

During 2010, we performed a strategic review of our mortgage business. As a result of this, we effectively exited the European mortgage market through the sale of our U.K. and continental Europe operations. The sale of these operations was completed on October 1, 2010. Certain components of the sale were completed on September 30, 2010. Refer to Note 2 for additional information on the sale. We also completed the sale of certain higher-risk legacy mortgage assets and settled representation and warranty claims with certain counterparties. The ongoing focus of our Mortgage operations will be predominately the origination and servicing of conforming mortgages. While the opportunities for further risk mitigation remain, the risk in the Mortgage operations has been materially reduced as compared to recent levels.

ALLY FINANCIAL INC.

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS (unaudited)

In the future, Ally and ResCap may take additional actions with respect to ResCap as each party deems appropriate. These actions may include Ally providing or declining to provide additional liquidity and capital support for ResCap; refinancing or restructuring some or all of ResCap’s existing debt; the purchase or sale of ResCap debt securities in the public or private markets for cash or other consideration; entering into derivative or other hedging or similar transactions with respect to ResCap or its debt securities; Ally purchasing assets from ResCap; or undertaking corporate transactions such as a tender offer or exchange offer for some or all of ResCap’s outstanding debt securities, a merger, sale, asset sales, consolidation, spin-off, distribution, or other business combination or reorganization or similar action with respect to all or part of ResCap and/or its affiliates. In this context, Ally and ResCap typically consider a number of factors to the extent applicable and appropriate including, without limitation, the financial condition, results of operations, and prospects of Ally and ResCap; ResCap’s ability to obtain third-party financing; tax considerations; the current and anticipated future trading price levels of ResCap’s debt instruments; conditions in the mortgage banking industry and general economic conditions; other investment and business opportunities available to Ally and/or ResCap; and any nonpublic information that ResCap may possess or that Ally receives from ResCap.

ResCap remains heavily dependent on Ally and its affiliates for funding and capital support, and there can be no assurance that Ally or its affiliates will continue such actions or that Ally will choose to execute any further strategic transactions with respect to ResCap, or that any transactions undertaken will be successful.

Although our continued actions through various funding and capital initiatives demonstrate support for ResCap, there are currently no commitments or assurances for future funding and/or capital support. Consequently, there remains substantial doubt about ResCap’s ability to continue as a going concern. Should we no longer continue to support the capital or liquidity needs of ResCap or should ResCap be unable to successfully execute other initiatives, it would have a material adverse effect on ResCap’s business, results of operations, and financial position.

Ally has extensive financing and hedging arrangements with ResCap that could be at risk of nonpayment if ResCap were to file for bankruptcy. At September 30, 2010, we had approximately $2.1 billion in secured financing arrangements with ResCap of which approximately $1.3 billion in loans was utilized. Amounts outstanding under the secured financing and hedging arrangements fluctuate. If ResCap were to file for bankruptcy, ResCap’s repayments of its financing facilities, including those with us, could be slower. In addition, we could be an unsecured creditor of ResCap to the extent that the proceeds from the sale of our collateral are insufficient to repay ResCap’s obligations to us. It is possible that other ResCap creditors would seek to recharacterize our loans to ResCap as equity contributions or to seek equitable subordination of our claims so that the claims of other creditors would have priority over our claims. In addition, should ResCap file for bankruptcy, our $859 million investment related to ResCap’s equity position would likely be reduced to zero. If a ResCap bankruptcy were to occur and a substantial amount of our credit exposure is not repaid to us, it would have an adverse impact on our near-term net income and capital position, but we do not believe it would have a materially adverse impact on Ally’s consolidated financial position over the longer term.

Corporate Conversion

Effective June 30, 2009, we converted (the Conversion) from a Delaware limited liability company to a Delaware corporation pursuant to Section 18-216 of the Delaware Limited Liability Company Act and Section 265 of the Delaware General Corporation Law. In connection with the Conversion, each unit of each class of common and preferred membership interests issued and outstanding immediately prior to the Conversion was converted into shares of capital stock with substantially the same rights and preferences as such membership interests. Refer to Note 17 for additional information regarding the tax impact of the conversion.

Recently Adopted Accounting Standards

Accounting for Transfers of Financial Assets (ASU 2009-16)

As of January 1, 2010, we adopted ASU 2009-16 (formerly Statement of Financial Accounting Standards Board (SFAS) No. 166), which amended Accounting Standards Codification (ASC) Topic 860, Transfers and Servicing. This standard removes the concept of a qualifying special-purpose entity (QSPE) and creates more stringent conditions for reporting a sale when a portion of a financial asset is transferred. To determine if a transfer is to be accounted for as a sale, the transferor must assess whether the transferor and all of the entities included in the transferor's consolidated financial statements surrendered

ALLY FINANCIAL INC.

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS (unaudited)

control of the assets. For partial asset transfers, the transferred portion must represent a pro rata component of the entire asset with no form of subordination. This standard is applied prospectively for transfers that occur on or after the effective date; however, the elimination of the QSPE concept required us to retrospectively assess all current off-balance sheet QSPE structures for consolidation under ASC Topic 810, Consolidation, and record a cumulative-effect adjustment to retained earnings for any consolidation change. Retrospective application of ASU 2009-16, specifically the QSPE removal, was assessed as part of the analysis required by ASU 2009-17, Improvements to Financial Reporting by Enterprises Involved with Variable Interest Entities. Refer to the section below for further information related to ASU 2009-17.

Improvements to Financial Reporting by Enterprises Involved with Variable Interest Entities (ASU 2009-17)

As of January 1, 2010, we adopted ASU 2009-17 (formerly SFAS No. 167), which amended ASC Topic 810, Consolidation. This standard addresses the primary beneficiary assessment criteria for determining whether an entity is required to consolidate a variable interest entity (VIE). This standard requires an entity to determine whether it is the primary beneficiary by performing a qualitative assessment rather than using the quantitative-based model that was required under the previous accounting guidance. The qualitative assessment consists of determining whether the entity has both the power to direct the activities that most significantly impact the VIE’s economic performance and the right to receive benefits or obligation to absorb losses that could potentially be significant to the VIE. As a result of the implementation of ASU 2009-16 and ASU 2009-17, several of our securitization structures previously held off-balance sheet were recognized as consolidated entities resulting in a day-one increase of $17.6 billion to assets and liabilities on our Condensed Consolidated Balance Sheet ($10.1 billion of the increase related to operations classified as held-for-sale). As part of the day-one entry, there was an immaterial adjustment to our opening equity balance.

Expanded Disclosures about Fair Value Measurements (ASU 2010-06)

As of March 31, 2010, we adopted the majority of ASU 2010-06, which amends ASC Topic 820, Fair Value Measurements. The ASU requires fair value disclosures for each asset and liability class, disclosures related to inputs and valuation methods for measurements that use Level 2 or Level 3 inputs, disclosures of significant transfers between Levels 1 and 2, and the gross presentation of significant transfers into or out of Level 3 within the Level 3 rollforward. The ASU also requires the gross presentation of purchases, sales, issuances, and settlements within the Level 3 rollforward; however, this specific requirement will be effective for us during the three months ended March 31, 2011. The disclosure requirement by class is a higher level of disaggregation compared to the previous requirement, which was based on the major asset or liability category. While the adoption of ASU 2010-06 expanded our disclosures related to fair value measurements, it did not modify the accounting treatment or measurement of items at fair value and, as such, did not have a material impact on our financial statements.

Derivatives and Hedging – Scope Exception Related to Embedded Credit Derivatives (ASU 2010-11)

In March 2010, the FASB issued ASU 2010-11, which clarifies that the transfer of credit risk that is only in the form of subordination of one financial instrument to another financial instrument (such as the subordination of one beneficial interest to another tranche of a securitization) is an embedded derivative feature. The embedded derivative feature should not be subject to potential bifurcation or separate accounting under ASC 815, Derivatives and Hedging. In addition, the ASU provides guidance on whether other embedded credit derivatives in financial instruments are subject to bifurcation and separate accounting. ASU 2010-11 was effective for us on July 1, 2010, and the adoption did not have a material impact on our consolidated financial condition or results of operation.

Recently Issued Accounting Standards

Revenue Arrangements with Multiple Deliverables (ASU 2009-13)

In October 2009, the FASB issued ASU 2009-13, which amends ASC Topic 605, Revenue Recognition. The guidance significantly changes the accounting for revenue recognition in arrangements with multiple deliverables and eliminates the residual method, which allocated the discount of a multiple deliverable arrangement among the delivered items. Under the guidance, entities will be required to allocate the total consideration to all deliverables at inception using the relative selling price and to allocate any discount in the arrangement proportionally to each deliverable based on each deliverable’s selling price. ASU 2009-13 is effective for revenue arrangements that we enter into or materially modify on or after January 1, 2011. We do not expect the adoption to have a material impact to our consolidated financial condition or results of operation.

ALLY FINANCIAL INC.

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS (unaudited)

Disclosures about the Credit Quality of Financing Receivables and the Allowance for Credit Losses (ASU 2010-20)

In July 2010, the FASB issued ASU 2010-20, which requires expanded disclosures related to the credit quality of finance receivables and loans. This disclosure will be effective for us during the December 31, 2010, reporting period. The ASU also requires a rollforward of the allowance for loan losses for each reporting period, which will be effective for us during the March 31, 2011, reporting period. Since the guidance relates only to disclosures, adoption will not have a material effect on our consolidated financial condition or results of operation.

2.	Discontinued and Held-for-sale Operations

Discontinued Operations

During 2009, we committed to sell certain operations of ResCap’s International Business Group (IBG). These operations included residential mortgage loan origination, acquisition, servicing, asset management, sale, and securitizations in the United Kingdom and continental Europe (the Netherlands and Germany). During the three months ended June 30, 2010, we classified the U.K. operations as discontinued. The continental Europe operations met the discontinued operations criteria during the three months ended December 31, 2009. On September 30, 2010, and October 1, 2010, we completed the sale of these operations. The components of the sale that were completed on October 1, 2010, were classified as assets and liabilities of operations held-for-sale on our Condensed Consolidated Balance Sheet at September 30, 2010, and were valued consistently with the proceeds received from the sale.

During 2009, we committed to sell the U.S. consumer property and casualty insurance business of our Insurance operations. These operations provided vehicle and home insurance in the United States through a number of distribution channels including independent agents, affinity groups, and the internet. The sale of our U.S. consumer property and casualty insurance business was completed during the first quarter of 2010. Additionally, during 2009, we committed to sell the U.K. consumer property and casualty insurance business. We are in active negotiations and expect to complete the sale during the first half of 2011.

During the three months ended June 30, 2010, we ceased to operate at our International Automotive Finance operations in Australia and Russia and classified them as discontinued.

During 2009, we committed to sell certain operations of our International Automotive Finance operations including our Argentina, Poland, and Ecuador operations and our Masterlease operations in Australia, Belgium, France, Italy, Mexico, the Netherlands, Poland, and the United Kingdom. Our Masterlease operations provide full-service individual leasing and fleet leasing products including maintenance, fleet, and accident management services as well as fuel programs, short-term vehicle rental, and title and licensing services. During 2009, the sales of the Masterlease operations in Italy, Mexico, and the Netherlands were completed. During the three months ended June 30, 2010, we completed the sale of our Poland operations and our Masterlease operations in Australia, Poland, Belgium, and France. In July 2010, we completed the sale of our Argentina operations. We are in active negotiations to complete the sale of our Masterlease operations in the United Kingdom and are awaiting satisfaction of certain closing conditions involving third parties in order to complete the sale of our Ecuador operations. We expect both to be completed within the next six months.

During 2009, we committed to sell the North American-based factoring business of our Commercial Finance Group. On April 30, 2010, the sale of the North American-based factoring business was completed.

We classified these operations as discontinued operations using generally accepted accounting principles in the United States of America, as the associated operations and cash flows will be eliminated from our ongoing operations and we will not have any significant continuing involvement in their operations after the respective sale transactions. For all periods presented, all of the operating results for these operations were removed from continuing operations and are presented separately as discontinued operations, net of tax. The Notes to the Condensed Consolidated Financial Statements were adjusted to exclude discontinued operations unless otherwise noted.

The pretax income or loss recognized through September 30, 2010, for the discontinued operations, including the direct costs to transact a sale, could differ from the ultimate sales price due to the fluidity of ongoing negotiations, price volatility, changing interest rates, changing foreign currency rates, and future economic conditions.

ALLY FINANCIAL INC.

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS (unaudited)

Selected financial information of discontinued operations is summarized below.


	Three months ended September 30,						Nine months ended September 30,
($ in millions)	2010			2009			2010			2009
Select Mortgage operations
Total net revenue (loss)	$	25		$	(29	)	$	69		$	(615	)
Pretax (loss) income including direct costs to transact a sale		(46	)		(91	)		56			(861	)
Tax expense (benefit)		5			(2	)		(3	)		(2	)
Select Insurance operations
Total net revenue	$	57		$	358		$	357		$	1,112
Pretax income (loss) including direct costs to transact a sale (a)		3			(52	)		(3	)		(604	)
Tax (benefit)		—			(98	)		(1	)		(84	)
Select International operations
Total net revenue	$	24		$	102		$	97		$	264
Pretax income (loss) including direct costs to transact a sale (a)		34			(203	)		92			(201	)
Tax (benefit)		(4	)		(47	)		(3	)		(43	)
Select Commercial Finance operations
Total net revenue	$	—		$	17		$	11		$	32
Pretax income (loss) including direct costs to transact a sale (a)		1			2			8			(6	)
Tax expense		—			1			—			1

(a)	Includes certain income tax activity recognized by Corporate and Other.

ALLY FINANCIAL INC.

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS (unaudited)

Held-for-sale Operations

The assets and liabilities held-for-sale at September 30, 2010, are summarized below.


($ in millions)	Select Mortgage operations (a)			Select Insurance operations (b)			Select International operations (c)			Total held-for-sale operations
Assets
Cash and cash equivalents
Noninterest-bearing	$	62		$	11		$	1		$	74
Interest-bearing		48			4			9			61

Total cash and cash equivalents		110			15			10			135
Trading securities		25			—			—			25
Investment securities — available-for-sale		—			474			—			474
Loans held-for-sale, net		170			—			—			170
Finance receivables and loans, net
Consumer		314			—			249			563
Allowance for loan losses		(26	)		—			(2	)		(28	)

Total finance receivables and loans, net		288			—			247			535
Investment in operating leases, net		—			—			354			354
Premiums receivable and other insurance assets		—			163			—			163
Other assets		185			142			23			350
Impairment on assets of held-for-sale operations		(307	)		(206	)		(101	)		(614	)

Total assets	$	471		$	588		$	533		$	1,592

Liabilities
Debt
Short-term borrowings	$	—		$	—		$	44		$	44
Long-term debt		—			—			121			121

Total debt		—			—			165			165
Interest payable		—			—			1			1
Unearned insurance premiums and service revenue		—			127			—			127
Reserves for insurance losses and loss adjustment expenses		—			372			—			372
Accrued expenses and other liabilities		8			37			33			78

Total liabilities	$	8		$	536		$	199		$	743

(a)	Includes operations of ResCap's International Business Group in continental Europe and in the United Kingdom. These operations were sold on October 1, 2010.

(b)	Includes the U.K. consumer property and casualty insurance business and certain international insurance operations.

(c)	Includes the International Automotive Finance operations of Ecuador and Masterlease in the United Kingdom.

ALLY FINANCIAL INC.

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS (unaudited)

The assets and liabilities of held-for-sale operations at December 31, 2009, are summarized below.


($ in millions)	Select Mortgage operations (a)			Select Insurance operations (b)			Select International operations (c)			Select Commercial Finance Group operations (d)			Total held-for-sale operations
Assets
Cash and cash equivalents
Noninterest-bearing	$	4		$	578		$	33		$	—		$	615
Interest-bearing		151			—			11			—			162

Total cash and cash equivalents		155			578			44			—			777
Trading securities		36			—			—			—			36
Investment securities — available-for-sale		—			794			—			—			794
Loans held-for-sale, net		214			—			—			—			214
Finance receivables and loans, net
Consumer		2,650			—			400			—			3,050
Commercial		—			—			246			233			479
Notes receivable from General Motors		—			—			14			—			14
Allowance for loan losses		(89	)		—			(11	)		—			(100	)

Total finance receivables and loans, net		2,561			—			649			233			3,443
Investment in operating leases, net		—			—			885			—			885
Mortgage servicing rights		(26	)		—			—			—			(26	)
Premiums receivable and other insurance assets		—			1,126			—			—			1,126
Other assets		512			176			135			—			823
Impairment on assets of held-for-sale operations		(903	)		(231	)		(324	)		(30	)		(1,488	)

Total assets	$	2,549		$	2,443		$	1,389		$	203		$	6,584

Liabilities
Debt
Short-term borrowings	$	—		$	34		$	57		$	—		$	91
Long-term debt		1,749			—			237			—			1,986

Total debt		1,749			34			294			—			2,077
Interest payable		3			—			1			—			4
Unearned insurance premiums and service revenue		—			517			—			—			517
Reserves for insurance losses and loss adjustment expenses		—			1,471			—			—			1,471
Accrued expenses and other liabilities		430			84			128			187			829

Total liabilities	$	2,182		$	2,106		$	423		$	187		$	4,898

(a)	Includes the operations of ResCap's International Business Group in continental Europe and in the United Kingdom.

(b)	Includes the U.S. and U.K. consumer property and casualty insurance businesses.

(c)	Includes the International Automotive Finance operations of Argentina, Ecuador, and Poland and Masterlease in Australia, Belgium, France, Poland, and the United Kingdom.

(d)	Includes the North American-based factoring business of our Commercial Finance Group.

ALLY FINANCIAL INC.

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS (unaudited)

Recurring Fair Value

The following tables display the assets and liabilities of our held-for-sale operations measured at fair value on a recurring basis. We often economically hedge the fair value change of our assets or liabilities with derivatives and other financial instruments. The tables below display the hedges separately from the hedged items; therefore, they do not directly display the impact of our risk management activities. Refer to Note 19 for descriptions of valuation methodologies used to measure material assets and liabilities at fair value and details of the valuation models, key inputs to these models, and significant assumptions used.


	Recurring fair value measurements
September 30, 2010 ($ in millions)	Level 1		Level 2		Level 3		Total
Assets
Trading securities
Mortgage-backed
Residential	$	—	$	—	$	25	$	25

Total trading securities		—		—		25		25
Investment securities
Available-for-sale securities
Debt securities
Foreign government		308		—		—		308
Other		—		166		—		166

Total debt securities		308		166		—		474

Total assets	$	308	$	166	$	25	$	499

ALLY FINANCIAL INC.

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS (unaudited)


	Recurring fair value measurements
December 31, 2009 ($ in millions)	Level 1		Level 2			Level 3			Total
Assets
Trading securities
Mortgage-backed
Residential	$	—	$	—		$	36		$	36

Total trading securities		—		—			36			36
Investment securities
Available-for-sale securities
Debt securities
U.S. Treasury and federal agencies		243		2			—			245
States and political subdivisions		—		24			—			24
Foreign government		329		—			—			329
Corporate debt securities		—		7			—			7
Other		—		189			—			189

Total debt securities		572		222			—			794
Mortgage servicing rights		—		—			(26	)		(26	)
Other assets
Interests retained in financial asset sales		—		—			153			153
Fair value of derivative contracts in receivable position
Interest rate contracts		—		60			—			60

Total assets	$	572	$	282		$	163		$	1,017

Liabilities
Accrued expenses and other liabilities
Fair value of derivative contracts in liability position
Interest rate contracts	$	—	$	(40	)	$	—		$	(40	)

Total liabilities	$	—	$	(40	)	$	—		$	(40	)

The following tables present the reconciliation for all Level 3 assets and liabilities of our held-for-sale operations measured at fair value on a recurring basis. We often economically hedge the fair value change of our assets or liabilities with derivatives and other financial instruments. The Level 3 items presented below may be hedged by derivatives and other financial instruments that are classified as Level 1 or Level 2. Thus, the following tables do not fully reflect the impact of our risk management activities.


	Level 3 recurring fair value measurements
($ in millions)	Fair value at July 1, 2010			Net realized/ unrealized gains (losses) included in earnings (a)			Purchases, issuances, and settlements, net			Fair value at September 30, 2010		Net unrealized gains included in earnings still held at September 30, 2010 (a)
Assets
Trading securities
Mortgage-backed
Residential	$	—		$	3		$	22		$	25	$	3
Consumer mortgage finance receivables and loans, net (b)		8,398			7			(8,405	)		—		—

Total assets	$	8,398		$	10		$	(8,383	)	$	25	$	3

Liabilities
Secured debt
On-balance sheet securitization debt (b)	$	(7,857	)	$	(254	)	$	8,111		$	—	$	—

Total liabilities	$	(7,857	)	$	(254	)	$	8,111		$	—	$	—

(a)	Reported as (loss) income from discontinued operations, net of tax, in the Condensed Consolidated Statement of Income.

(b)	Carried at fair value due to fair value option elections.

ALLY FINANCIAL INC.

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS (unaudited)


	Level 3 recurring fair value measurements
($ in millions)	Fair value at January 1, 2010			Net realized/ unrealized gains (losses) included in earnings (a)			Purchases, issuances, and settlements, net			Fair value at September 30, 2010		Net unrealized gains included in earnings still held at September 30, 2010 (a)
Assets
Trading securities
Mortgage-backed
Residential	$	36		$	3		$	(14	)	$	25	$	3

Total trading securities		36			3			(14	)		25		3
Consumer mortgage finance receivables and loans, net (b)		—			422			(422	) (c)		—		—
Mortgage servicing rights		(26	)		—			26			—		—
Other assets
Interests retained in financial asset sales		153			—			(153	)		—		—

Total assets	$	163		$	425		$	(563	)	$	25	$	3

Liabilities
Secured debt
On-balance sheet securitization debt (b)	$	—		$	(57	)	$	57	(c)	$	—	$	—

Total liabilities	$	—		$	(57	)	$	57		$	—	$	—

(a)	Reported as (loss) income from discontinued operations, net of tax, in the Condensed Consolidated Statement of Income.

(b)	Carried at fair value due to fair value option elections.

(c)	Includes a $10.1 billion increase due to the adoption of ASU 2009-17 on January 1, 2010. This increase was subsequently offset when the operations were sold on September 30, 2010.

3.	Other Income, Net of Losses

Details of other income, net of losses, were as follows.


	Three months ended September 30,						Nine months ended September 30,
($ in millions)	2010			2009			2010			2009
Mortgage processing fees and other mortgage income	$	63		$	45		$	157		$	58
Remarketing fees		37			32			104			103
Late charges and other administrative fees		35			45			107			117
Full-service leasing fees		17			33			58			96
Other equity method investments		15			3			40			10
Real estate services, net		—			(5	)		8			(263	)
Change due to fair value option elections (a)		(52	)		(55	)		(181	)		(147	)
Fair value adjustment on certain derivatives (b)		(57	)		(31	)		(115	)		(92	)
Other, net		123			162			278			24

Total other income, net of losses	$	181		$	229		$	456		$	(94	)

(a)	Refer to Note 19 for a description of fair value option elections.

(b)	Refer to Note 16 for a description of derivative instruments and hedging activities.

ALLY FINANCIAL INC.

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS (unaudited)

4.	Other Operating Expenses

Details of other operating expenses were as follows.


	Three months ended September 30,				Nine months ended September 30,
($ in millions)	2010		2009		2010		2009
Mortgage representation and warranty expense, net	$	344	$	507	$	490	$	917
Insurance commissions		150		170		446		483
Technology and communications expense		118		133		390		434
Professional services		82		122		201		327
Advertising and marketing		49		50		123		124
Vehicle remarketing and repossession		43		46		145		151
Lease and loan administration		40		37		107		118
Regulatory and licensing fees		32		24		87		72
State and local non-income taxes		31		45		92		100
Premises and equipment depreciation		24		17		63		61
Rent and storage		22		28		73		79
Full-service leasing vehicle maintenance costs		14		35		50		99
Restructuring expenses		4		9		61		9
Other		141		273		477		603

Total other operating expenses	$	1,094	$	1,496	$	2,805	$	3,577

5.	Trading Securities

The fair value for our portfolio of trading securities by type was as follows.


($ in millions)	September 30, 2010		December 31, 2009
Trading securities
U.S. Treasury	$	75	$	—
Mortgage-backed
Residential		46		143
Asset-backed		90		596

Total trading securities	$	211	$	739

ALLY FINANCIAL INC.

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS (unaudited)

6.	Investment Securities

Our portfolio of securities includes bonds, equity securities, asset- and mortgage-backed securities, notes, interests in securitization trusts, and other investments. The cost, fair value, and gross unrealized gains and losses on available-for-sale and held-to-maturity securities were as follows.


	September 30, 2010									December 31, 2009
	Cost		Gross unrealized					Fair value		Cost		Gross unrealized					Fair value
($ in millions)	Cost		gains		losses			Fair value		Cost		gains		losses			Fair value
Available-for-sale securities
Debt securities
U.S. Treasury and federal agencies	$	2,625	$	44	$	—		$	2,669	$	3,501	$	15	$	(6	)	$	3,510
States and political subdivisions		4		—		—			4		779		36		(4	)		811
Foreign government		1,265		36		(2	)		1,299		1,161		20		(8	)		1,173
Mortgage-backed
Residential (a)		3,655		81		(5	)		3,731		3,404		76		(19	)		3,461
Asset-backed		1,676		20		—			1,696		1,000		7		(2	)		1,005
Corporate debt		1,339		59		(2	)		1,396		1,408		74		(9	)		1,473
Other		—		—		—			—		47		—		—			47

Total debt securities (b)		10,564		240		(9	)		10,795		11,300		228		(48	)		11,480
Equity securities		1,166		30		(66	)		1,130		631		52		(8	)		675

Total available-for-sale securities (c)	$	11,730	$	270	$	(75	)	$	11,925	$	11,931	$	280	$	(56	)	$	12,155

Held-to-maturity securities
Total held-to-maturity securities	$	—	$	—	$	—		$	—	$	3	$	—	$	—		$	3

(a)	Residential mortgage-backed securities include agency-backed bonds totaling $2,242 million and $2,248 million at September 30, 2010, and December 31, 2009, respectively.

(b)	In connection with certain borrowings and letters of credit relating to certain assumed reinsurance contracts, $165 million and $164 million of primarily U.K. Treasury securities were pledged as collateral at September 30, 2010, and December 31, 2009, respectively.

(c)	Certain entities related to our Insurance operations are required to deposit securities with state regulatory authorities. These deposited securities totaled $13 million and $15 million at September 30, 2010, and December 31, 2009, respectively.

The maturity distribution of available-for-sale debt securities outstanding is summarized in the following tables. Prepayments may cause actual maturities to differ from scheduled maturities.

Total

Due in
one year
or less

Due after
one year
through
five years

Due after
five years
through
ten years

Due after
ten years (a)

September 30, 2010 ($ in millions)

Amount

Yield

Amount

Yield

Amount

Yield

Amount

Yield

Amount

Yield

Fair value of available-for-sale debt securities (b)

U.S. Treasury and federal agencies

2,669

1.4

384

0.7

2,274

1.5

3.7

—

States and political subdivisions

8.7

—

8.7

Foreign government

1,299

2.9

1.1

1,132

2.8

161

3.7

—

Mortgage-backed

Residential

3,731

4.6

—

3.5

4.5

3,622

4.6

Asset-backed

1,696

2.4

—

1,219

2.2

298

2.4

178

3.5

Corporate debt

1,396

4.3

5.4

684

3.8

517

4.5

170

5.2

Total available-for-sale debt securities

10,795

3.2

416

0.9

5,367

2.3

1,038

3.8

3,974

4.6

Amortized cost of available-for-sale debt securities

10,564

417

5,256

992

3,899

(a)	Investments with no stated maturities are included as contractual maturities of greater than 10 years. Actual maturities may differ due to call or prepayment options.

(b)	Yields on tax-exempt obligations are computed on a tax-equivalent basis.

ALLY FINANCIAL INC.

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS (unaudited)


	Total					Due in one year or less					Due after one year through five years					Due after five years through ten years					Due after ten years (a)
December 31, 2009 ($ in millions)	Amount		Yield			Amount		Yield			Amount		Yield			Amount		Yield			Amount		Yield
Fair value of available-for-sale debt securities (b)
U.S. Treasury and federal agencies	$	3,510		1.9	%	$	103		1.1	%	$	3,390		1.9	%	$	17		4.1	%	$	—		—	%
States and political subdivisions		811		7.0			9		7.0			175		7.2			147		7.0			480		6.9
Foreign government		1,173		3.8			66		1.7			872		3.8			229		4.5			6		5.3
Mortgage-backed
Residential		3,461		6.5			—		—			2		6.5			36		13.0			3,423		6.4
Asset-backed		1,005		2.5			34		5.2			735		2.3			186		2.6			50		3.9
Corporate debt		1,473		5.2			283		3.4			575		5.8			570		5.4			45		6.9
Other		47		3.6			—		—			32		3.4			15		4.0			—		—

Total available-for-sale debt securities	$	11,480		4.3	%	$	495		2.8	%	$	5,781		2.8	%	$	1,200		5.2	%	$	4,004		6.5	%

Amortized cost of available-for-sale debt securities	$	11,300				$	473				$	5,728				$	1,169				$	3,930

(a)	Investments with no stated maturities are included as contractual maturities of greater than 10 years. Actual maturities may differ due to call or prepayment options.

(b)	Yields on tax-exempt obligations are computed on a tax-equivalent basis.

Certain highly liquid investment securities with maturities of three months or less from the date of purchase are classified as cash equivalents and are composed primarily of money market accounts and short-term securities, including U.S. Treasury bills. The carrying value of cash equivalents approximates fair value. The balance of cash equivalents was $5.8 billion and $1.8 billion at September 30, 2010, and December 31, 2009, respectively.

The following table presents gross gains and losses realized upon the sales of available-for-sale securities and other-than-temporary impairment.


	Three months ended September 30,						Nine months ended September 30,
($ in millions)	2010			2009			2010			2009
Gross realized gains	$	102		$	112		$	381		$	247
Gross realized losses		(2	)		(28	)		(25	)		(86	)
Other-than-temporary impairment		—			—			(1	)		(47	)

Net realized gains	$	100		$	84		$	355		$	114

The following table presents interest and dividends on available-for-sale securities.


	Three months ended September 30,				Nine months ended September 30,
($ in millions)	2010		2009		2010		2009
Taxable interest	$	83	$	36	$	256	$	129
Taxable dividends		5		3		13		6
Interest and dividends exempt from U.S. federal income tax		—		10		10		27

Total interest and dividends	$	88	$	49	$	279	$	162

ALLY FINANCIAL INC.

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS (unaudited)

The table below summarizes available-for-sale securities in an unrealized loss position in accumulated other comprehensive income. Based on the methodology described below that was applied to these securities, we believe that the unrealized losses relate to factors other than credit losses in the current market environment. As of September 30, 2010, we do not have the intent to sell the debt securities with an unrealized loss position in accumulated other comprehensive income, and it is not more likely than not that we will be required to sell these securities before recovery of their amortized cost basis. As of September 30, 2010, we had the ability and intent to hold equity securities with an unrealized loss position in accumulated other comprehensive income. As a result, we believe that the securities with an unrealized loss position in accumulated other comprehensive income are not considered to be other-than-temporarily impaired at September 30, 2010.


	September 30, 2010										December 31, 2009
	Less than 12 months					12 months or longer					Less than 12 months					12 months or longer
($ in millions)	Fair value		Unrealized loss			Fair value		Unrealized loss			Fair value		Unrealized loss			Fair value		Unrealized loss
Available-for-sale securities
Debt securities
U.S. Treasury and federal agencies	$	7	$	—		$	—	$	—		$	1,430	$	(6	)	$	—	$	—
States and political subdivisions		—		—			—		—			82		(2	)		8		(2	)
Foreign government securities		58		(2	)		—		—			536		(8	)		—		—
Mortgage-backed securities		876		(5	)		1		—			811		(14	)		6		(5	)
Asset-backed securities		2		—			2		—			202		(1	)		22		(1	)
Corporate debt securities		176		(2	)		—		—			47		(1	)		120		(8	)
Other		—		—			—		—			7		—			—		—

Total temporarily impaired debt securities		1,119		(9	)		3		—			3,115		(32	)		156		(16	)
Temporarily impaired equity securities		575		(64	)		19		(2	)		115		(5	)		52		(3	)

Total temporarily impaired available-for-sale securities	$	1,694	$	(73	)	$	22	$	(2	)	$	3,230	$	(37	)	$	208	$	(19	)

We employ a systematic methodology that considers available evidence in evaluating potential other-than-temporary impairment of our investments classified as available-for-sale. If the cost of an investment exceeds its fair value, we evaluate, among other factors, the magnitude and duration of the decline in fair value, the financial health of and business outlook for the issuer, changes to the rating of the security by a rating agency, the performance of the underlying assets for interests in securitized assets, whether we intend to sell the investment, and whether it is more likely than not we will be required to sell the debt security before recovery of its amortized cost basis.

7.	Loans Held-for-sale, Net

The composition of loans held-for-sale, net, was as follows.


	September 30, 2010						December 31, 2009
($ in millions)	Domestic		Foreign		Total		Domestic		Foreign		Total
Consumer
Automobile	$	930	$	119	$	1,049	$	9,417	$	184	$	9,601
1st Mortgage		11,135		143		11,278		9,269		530		9,799
Home equity		938		—		938		1,068		—		1,068

Total consumer (a)		13,003		262		13,265		19,754		714		20,468
Commercial
Commercial and industrial
Other		—		—		—		—		157		157

Total loans held-for-sale (b)	$	13,003	$	262	$	13,265	$	19,754	$	871	$	20,625

(a)	Fair value option-elected domestic residential mortgages were $7.0 billion and $5.5 billion at September 30, 2010, and December 31, 2009, respectively. Refer to Note 19 for additional information related to these government- and agency-eligible loans.

(b)	Totals are net of unamortized premiums and discounts and deferred fees and costs of $148 million and $318 million at September 30, 2010, and December 31, 2009, respectively.

ALLY FINANCIAL INC.

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS (unaudited)

8.	Finance Receivables and Loans, Net

The composition of finance receivables and loans, net, before allowance for loan losses was as follows.


	September 30, 2010						December 31, 2009
($ in millions)	Domestic		Foreign		Total		Domestic		Foreign		Total
Consumer
Automobile	$	29,888	$	16,206	$	46,094	$	12,514	$	17,731	$	30,245
1st Mortgage		8,653		911		9,564		7,960		405		8,365
Home equity		4,527		—		4,527		4,238		1		4,239

Total consumer (a)		43,068		17,117		60,185		24,712		18,137		42,849

Commercial
Commercial and industrial
Automobile		23,576		7,529		31,105		19,601		7,035		26,636
Mortgage		2,038		75		2,113		1,572		96		1,668
Resort finance		—		—		—		843		—		843
Other		2,061		375		2,436		1,845		437		2,282
Commercial real estate
Automobile		2,055		243		2,298		2,008		221		2,229
Mortgage		5		93		98		121		162		283

Total commercial		29,735		8,315		38,050		25,990		7,951		33,941

Notes receivable from General Motors		—		483		483		3		908		911

Total finance receivables and loans (b)	$	72,803	$	25,915	$	98,718	$	50,705	$	26,996	$	77,701

(a)	Fair value option-elected residential mortgages were $2.9 billion and $1.3 billion at September 30, 2010, and December 31, 2009, respectively. Refer to Note 19 for additional information.

(b)	Totals are net of unearned income, unamortized premiums and discounts, and deferred fees and costs of $2.8 billion and $2.4 billion at September 30, 2010, and December 31, 2009, respectively.

The following tables present an analysis of the activity in the allowance for loan losses on finance receivables and loans, net.


	2010									2009
Three months ended September 30, ($ in millions)	Consumer			Commercial			Total			Consumer			Commercial			Total
Allowance at July 1,	$	1,779		$	598		$	2,377		$	2,307		$	994		$	3,301
Provision for loan losses		86			(77	)		9			537			143			680
Charge-offs
Domestic		(248	)		(98	)		(346	)		(682	)		(244	)		(926	)
Foreign		(46	)		(38	)		(84	)		(158	)		(37	)		(195	)

Total charge-offs		(294	)		(136	)		(430	)		(840	)		(281	)		(1,121	)

Recoveries
Domestic		71			4			75			62			5			67
Foreign		19			2			21			20			—			20

Total recoveries		90			6			96			82			5			87

Net charge-offs		(204	)		(130	)		(334	)		(758	)		(276	)		(1,034	)
Discontinued operations		—			(1	)		(1	)		22			3			25
Other		13			(10	)		3			(2	)		4			2

Allowance at September 30,	$	1,674		$	380		$	2,054		$	2,106		$	868		$	2,974

ALLY FINANCIAL INC.

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS (unaudited)


	2010									2009
Nine months ended September 30, ($ in millions)	Consumer			Commercial			Total			Consumer			Commercial			Total
Allowance at January 1,	$	1,664		$	781		$	2,445		$	2,536		$	897		$	3,433
Provision for loan losses		431			(56	)		375			1,832			711			2,543
Charge-offs
Domestic		(795	)		(250	)		(1,045	)		(1,922	)		(716	)		(2,638	)
Foreign		(157	)		(91	)		(248	)		(773	)		(55	)		(828	)

Total charge-offs		(952	)		(341	)		(1,293	)		(2,695	)		(771	)		(3,466	)

Recoveries
Domestic		257			12			269			172			11			183
Foreign		54			11			65			49			5			54

Total recoveries		311			23			334			221			16			237

Net charge-offs		(641	)		(318	)		(959	)		(2,474	)		(755	)		(3,229	)
Addition of allowance due to change in accounting principle (a)		222			—			222			—			—			—
Discontinued operations		(1	)		(3	)		(4	)		160			6			166
Other		(1	)		(24	)		(25	)		52			9			61

Allowance at September 30,	$	1,674		$	380		$	2,054		$	2,106		$	868		$	2,974

(a)	Effect of change in accounting principle due to adoption of ASU 2009-16, Accounting for Transfers of Financial Assets, and ASU 2009-17, Improvements to Financial Reporting by Enterprises Involved with Variable Interest Entities. Refer to Note 1 for additional information.

The following tables present information about our impaired finance receivables and loans. These tables exclude loans carried at fair value due to the fair value option elections.


	September 30, 2010						December 31, 2009
($ in millions)	Consumer		Commercial		Total		Consumer		Commercial		Total
Impaired finance receivables and loans
With an allowance	$	430	$	636	$	1,066	$	252	$	1,760	$	2,012
Without an allowance		40		209		249		16		296		312

Total impaired loans	$	470	$	845	$	1,315	$	268	$	2,056	$	2,324

Allowance for impaired loans	$	105	$	247	$	352	$	80	$	488	$	568


	2010						2009
Three months ended September 30, ($ in millions)	Consumer		Commercial		Total		Consumer		Commercial		Total
Average balance of impaired loans	$	435	$	1,318	$	1,753	$	769	$	2,891	$	3,660
Interest income recognized on impaired loans	$	6	$	8	$	14	$	6	$	27	$	33


	2010						2009
Nine months ended September 30, ($ in millions)	Consumer		Commercial		Total		Consumer		Commercial		Total
Average balance of impaired loans	$	363	$	1,633	$	1,996	$	592	$	3,009	$	3,601
Interest income recognized on impaired loans	$	13	$	12	$	25	$	22	$	47	$	69

At September 30, 2010, and December 31, 2009, commercial commitments to lend additional funds to debtors owing receivables whose terms had been modified in troubled debt restructuring were $16 million and $12 million, respectively.

ALLY FINANCIAL INC.

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS (unaudited)

9.	Off-balance Sheet Securitizations

We sell pools of automotive and residential mortgage loans and contracts via securitization transactions, which provide permanent funding and facilitates asset and liability management. In executing the securitization transactions, we typically sell the pools to wholly owned bankruptcy-remote special-purpose entities (SPEs), which then transfer the loans or contracts to a separate, transaction-specific SPE (a securitization trust) for cash, servicing rights, and in some transactions, other retained interests. The securitization trust issues interests and interests are sold to investors. These interests are collateralized by the secured loans or contracts and entitle the investors to specified cash flows generated from the securitized loans or contracts.

Our securitization transactions are accounted for under the requirements of ASC 810, Consolidation, and ASC 860, Transfers and Servicing. ASU 2009-16, Accounting for Transfers of Financial Assets, and ASU 2009-17, Improvements to Financial Reporting by Enterprises Involved with Variable Interest Entities, amended ASC 810 and ASC 860. These standards became effective on January 1, 2010, and required the prospective consolidation of certain securitization assets and liabilities that were previously held off-balance sheet. We reflected our economic interest in these newly consolidated structures primarily through loans and secured debt rather than as interests held in off-balance sheet securitization trusts. Refer to Note 1 for additional information related to the adoption of ASU 2009-16 and ASU 2009-17. Refer to Note 20 for additional information related to the consolidation of certain securitization trusts due to the adoption of the new standards.

The following discussion and related information is only applicable to the transfers of finance receivables and loans that qualify for off-balance sheet treatment.

Each securitization is governed by various legal documents that limit and specify the activities of the securitization vehicle. The securitization vehicle is generally allowed to acquire the loans or contracts being sold to it, to issue interests to investors to fund the acquisition of the loans or contracts, and to enter into derivatives or other yield maintenance contracts to hedge or mitigate certain risks related to the asset pool or debt securities. Additionally, the securitization vehicle is required to service the assets it holds and the debt or interest it issues. A servicer appointed within the underlying legal documents performs these functions. Servicing functions include, but are not limited to, collecting payments from borrowers, performing escrow functions, monitoring delinquencies, liquidating assets, investing funds until distribution, remitting payments to investors, and accounting for and reporting information to investors. As part of our off-balance sheet securitizations, we typically retain servicing responsibilities and, in some cases, other retained interests. Accordingly, our servicing responsibilities result in continued involvement in the form of servicing the underlying asset (primary servicing) and/or servicing the bonds resulting from the securitization transactions (master servicing) through servicing platforms. Certain securitizations require the servicer to advance scheduled principal and interest payments due on the pool regardless of whether they are received from borrowers. Accordingly, we are required to provide these servicing advances when applicable. Refer to Note 1 to the Condensed Financial Statements in our 2009 Annual Report on Form 10-K regarding the valuation of servicing rights. Subsequent to the adoption of ASU 2009-16 and ASU 2009-17 as of January 1, 2010, we generally do not hold significant or potentially significant retained interests in our securitization trusts that qualify for off-balance sheet treatment under ASU 2009-17.

Generally, the assets initially transferred into the securitization vehicle are the sole repayment source to the investors in the securitization trust and the various other parties that perform services for the transaction, such as the servicer or the trustee. In certain transactions, a liquidity provider or facility may exist to provide temporary liquidity to the structure. The liquidity provider generally is reimbursed prior to other parties in subsequent distribution periods. Bond insurance may also exist to cover certain shortfalls to certain investors. As noted above, in certain securitizations, the servicer is required to advance scheduled principal and interest payments due on the pool regardless of whether they were received from the borrowers. The servicer is allowed to reimburse itself for these servicing advances. Additionally, certain securitization transactions may allow for the acquisition of additional loans or contracts subsequent to the initial loan. Principal collections on other loans and/or the issuance of new interests, such as variable funding notes, generally fund these loans; we are often contractually required to invest in these new interests. Lastly, we provide certain guarantees as discussed in Note 30 to the Consolidated Financial Statements in our 2009 Annual Report on Form 10-K.

ALLY FINANCIAL INC.

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS (unaudited)

The investors and/or securitization trusts have no recourse to us with the exception of market customary representation and warranty repurchase provisions and, in certain transactions, early payment default provisions. Representation and warranty repurchase provisions generally require us to repurchase loans or contracts to the extent it is determined that the loans were ineligible or were otherwise defective at the time of sale. Due to market conditions, early payment default provisions are included in certain securitization transactions that require us to repurchase loans or contracts if the borrower is delinquent in making certain specific payments subsequent to the sale.

We generally hold certain conditional repurchase options that allow us to repurchase assets from the securitization. The majority of the securitizations provide us, as servicer, with a call option that allows us to repurchase the remaining assets or outstanding debt once the asset pool reaches a predefined level, which represents the point where servicing is burdensome rather than beneficial. Such an option is referred to as a clean-up call. As servicer, we are able to exercise this option at our discretion anytime after the asset pool size falls below the predefined level. The repurchase price for the loans or contracts is typically par plus accrued interest. Additionally, we may hold other conditional repurchase options that allow us to repurchase the asset if certain events, outside our control, are met. The typical conditional repurchase option is a delinquent loan repurchase option that gives us the option to purchase the loan or contract if it exceeds a certain prespecified delinquency level. We have complete discretion regarding when or if we will exercise these options, but generally, we would do so when it is in our best interest.

The loans or contracts sold into off-balance sheet securitization transactions are removed from our balance sheet. The assets obtained from the securitization are primarily reported as cash, servicing rights, or (if retained) retained interests. Typically, we conclude that the fee we are paid for servicing retail automotive finance receivables represents adequate compensation, and consequently, we do not recognize a servicing asset or liability. We elected fair value treatment for our existing mortgage servicing rights (MSRs) portfolio. Liabilities incurred as part of the transaction, such as representation and warranty provisions, are recorded at fair value at the time of sale and are reported as accrued expenses and other liabilities on our Condensed Consolidated Balance Sheet. Upon the sale of the loans or contracts, we recognize a gain or loss on sale for the difference between the assets recognized, the assets derecognized, and the liabilities recognized as part of the transaction.

The following summarizes the pretax gains and losses recognized on the types of loans or contracts sold into off-balance sheet securitization transactions.


	Three months ended September 30,					Nine months ended September 30,
($ in millions)	2010			2009		2010		2009
Retail finance receivables	$	—		$	—	$	—	$	—
Automotive wholesale loans		—			8		—		110
Mortgage loans		(1	)		—		3		(4	)

Total pretax (loss) gain on off-balance sheet activities	$	(1	)	$	8	$	3	$	106

The following summarizes the type and amount of loans held by the securitization trusts in transactions that qualified for off-balance sheet treatment.


($ in billions)	September 30, 2010		December 31, 2009
Retail finance receivables	$	—	$	7.5
Automotive wholesale loans		—		—
Mortgage loans (a)		72.8		99.6

Total off-balance sheet activities	$	72.8	$	107.1

(a)	Excludes $148 million and $237 million of delinquent loans held by securitization trusts at September 30, 2010, and December 31, 2009, respectively, that we have the option to repurchase as they are included in consumer finance receivables and loans and mortgage loans held-for-sale.

ALLY FINANCIAL INC.

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS (unaudited)

10.

Investment in Operating Leases, Net

Investments in operating leases were as follows.


($ in millions)	September 30, 2010			December 31, 2009
Vehicles and other equipment, after impairment	$	15,483		$	23,919
Accumulated depreciation		(5,270	)		(7,924	)

Investment in operating leases, net	$	10,213		$	15,995

Depreciation expense on operating lease assets includes remarketing gains and losses recognized on the sale of operating lease assets. The following summarizes the components of depreciation expense on operating lease assets.


	Three months ended September 30,						Nine months ended September 30,
($ in millions)	2010			2009			2010			2009
Depreciation expense on operating lease assets (excluding remarketing gains)	$	618		$	1,056		$	2,183		$	3,325
Gross remarketing gains		(164	)		(162	)		(547	)		(318	)

Depreciation expense on operating lease assets	$	454		$	894		$	1,636		$	3,007

11.

Mortgage Servicing Rights

The following tables summarize activity related to MSRs carried at fair value. Sufficient market inputs exist to determine the fair value of our recognized servicing assets and servicing liabilities.


Three months ended September 30, ($ in millions)	2010			2009
Estimated fair value at July 1,	$	2,983		$	3,509
Additions recognized on sale of mortgage loans		260			206
Additions from purchases of servicing assets		24			6
Changes in fair value
Due to changes in valuation inputs or assumptions used in the valuation model		(278	)		(216	)
Other changes in fair value (a)		(244	)		(278	)
Other changes that affect the balance		1			16

Estimated fair value at September 30,	$	2,746		$	3,243

(a)	Other changes in fair value primarily include the accretion of the present value of the discount related to forecasted cash flows and the economic runoff of the portfolio.

ALLY FINANCIAL INC.

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS (unaudited)


Nine months ended September 30, ($ in millions)	2010			2009
Estimated fair value at January 1,	$	3,554		$	2,848
Additions recognized on sale of mortgage loans		628			579
Additions from purchases of servicing assets		45			12
Subtractions from sales of servicing assets		—			(19	)
Changes in fair value
Due to changes in valuation inputs or assumptions used in the valuation model		(772	)		779
Other changes in fair value (a)		(694	)		(970	)
Decrease due to change in accounting principle (b)		(19	)		—
Other changes that affect the balance		4			14

Estimated fair value at September 30,	$	2,746		$	3,243

(a)	Other changes in fair value primarily include the accretion of the present value of the discount related to forecasted cash flows and the economic runoff of the portfolio.

(b)	The effect of change in accounting principle was due to the adoption of ASU 2009-16, Accounting for Transfers of Financial Assets, and ASU 2009-17, Improvements to Financial Reporting by Enterprises Involved with Variable Interest Entities. Refer to Note 1 for additional information.

Changes in fair value due to changes in valuation inputs or assumptions used in the valuation models include all changes due to revaluation by a model or by a benchmarking exercise. Other changes in fair value primarily include the accretion of the present value of the discount related to forecasted cash flows and the economic runoff of the portfolio.

We use the following key assumptions to value our MSRs.


September 30,	2010			2009
Range of prepayment speeds		8.0–44.2	%		0.7–49.4	%
Range of discount rates		2.2–25.6	%		3.0–130.0	%

The primary risk of our servicing rights is interest rate risk and the resulting impact on prepayments. A significant decline in interest rates could lead to higher-than-expected prepayments, which could reduce the value of the MSRs. We economically hedge the income statement impact of these risks with both derivative and nonderivative financial instruments. These instruments include interest rate swaps, caps and floors, options to purchase these items, futures and forward contracts, and/or purchasing or selling U.S. Treasury and principal-only securities. Refer to Note 16 for additional information regarding derivative instruments. The net fair value of derivative financial instruments used to mitigate these risks amounted to $817 million and $675 million at September 30, 2010 and 2009, respectively. The changes in fair value of the derivative financial instruments amounted to a gain of $1.3 billion and a loss of $519 million for the nine months ended September 30, 2010 and 2009, respectively, and were included in servicing asset valuation and hedge activities, net, in the Condensed Consolidated Statement of Income.

The components of mortgage servicing fees were as follows.


	Three months ended September 30,				Nine months ended September 30,
($ in millions)	2010		2009		2010		2009
Contractual servicing fees, net of guarantee fees and including subservicing	$	270	$	267	$	793	$	820
Late fees		17		18		56		63
Ancillary fees		56		38		146		112

Total	$	343	$	323	$	995	$	995

Our Mortgage operations that conduct primary and master servicing activities are required to maintain certain servicer ratings in accordance with master agreements entered into with government-sponsored entities. At September 30, 2010, our Mortgage operations were in compliance with the servicer-rating requirements of the master agreements.

ALLY FINANCIAL INC.

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS (unaudited)

12.

Other Assets

The components of other assets were as follows.


($ in millions)		September 30, 2010			December 31, 2009
Property and equipment at cost		$	1,305		$	1,416
Accumulated depreciation			(943	)		(1,080	)

Net property and equipment			362			336
Fair value of derivative contracts in receivable position			5,940			2,654
Restricted cash collections for securitization trusts (a)			2,879			3,654
Restricted cash and cash equivalents	</

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