Ally Financial is not just an auto lender any longer.
In fact, according to the bank’s CFO, Chris Halmy, the bank is in a transitional phase from a “pure auto lender to a broader leader in digital financial services.”
During the Financial Outlook Update this morning, Halmy emphasized the bank’s focus on expanding new products, including mortgage – introduced in Dec. 2016 – and wealth management.
“We see a massive addressable market in wealth management, where we can be a major player,” Halmy said.
Ally launched its wealth management offering in April last year, following the acquisition of TradeKing, an online discount brokerage and digital wealth management platform. The bank is now serving 250,000 wealth management customers, onboarded from TradeKing, according to Halmy. Ally estimates that at least half of its more than one million deposit account customers will, eventually, be using the product, the lender told Bank Innovation previously.
The bank plans to roll out its first automated investment offering with TradeKing soon, Halmy said, noting that the wealth management product is being rebranded to Ally Invest.
The product will be complementary to our savings products, and will be digitally managed. We are really emphasizing the combination of online savings and online investing with this. We will still charge $4.95 per trade, as we see most of the industry is migrating to this direction. One of the biggest values for us will be the deposits that they [TradeKing] is bringing for the wealth management side.
The bank plans to launch a “separate wealth management segment over time,” Halmy said during an earnings call earlier this year, which will provide “meaningful income,” particularly in 2018 and 2019.Like This Post