Ally to end mortgage originations, cut jobs

Ally Financial Inc. will cut jobs, end mortgage originations and consider strategic alternatives for its credit-card business as borrowers have struggled to pay down costly debt.

The Detroit-based company will cut less than 5% of its workforce, an Ally spokesperson said in an email to Bloomberg News. The firm had about 11,100 employees as of the end of 2023, with a significant portion of its workforce in Charlotte, North Carolina. The Charlotte Observer first reported the job cuts, and Bloomberg said in November that Ally was exploring a sale of its credit-card arm.

“As we continue to right-size our company, we made the difficult decision to selectively reduce our workforce in some areas, while continuing to hire in our other areas of our business,” spokesperson Peter Gilchrist said in the email. The cuts aren’t specific to one line of business or location, he said.

Ally has reported intensifying credit challenges across its divisions, including its better-known auto-lending business. The cost of debt has become more expensive for US consumers amid higher interest rates. Ally has tightened its criteria for who can qualify for an auto loan, expressing optimism that those actions could curtail loan charge-offs.