Ally Financial announces partial redemption of trust preferred securities and junior debentures

Rhea-AI Summary

Ally Financial Inc. announced that its subsidiary, GMAC Capital Trust I, is redeeming approximately 84.467% of its outstanding 8.125% Fixed Rate/Floating Rate Trust Preferred Securities and Common Securities, totaling 41.6 million and 1.248 million units, respectively, at a par price of $25.00 per unit. Concurrently, 42.848 million units of Junior Subordinated Debentures due 2040 will also be redeemed. The redemption date is set for July 2, 2021. After this date, no interest or distributions will accrue on the redeemed securities.

Positive

• Redemption of 41.6 million units of TRUPS may improve the capital structure.

Negative

• Redeeming a large amount of securities might indicate liquidity concerns.

DETROIT, June 2, 2021 /PRNewswire/ -- Ally Financial Inc. (NYSE: ALLY) announced today that GMAC Capital Trust I, a subsidiary trust of Ally (the "Trust"), is redeeming (i) 41,600,000 units of its 8.125% Fixed Rate/Floating Rate Trust Preferred Securities, Series 2 (CUSIP No. 361860208) (the "TRUPS") (constituting approximately 84.467% of the outstanding TRUPS) at a par price of $25.00 per unit, plus accrued interest payable from May 17, 2021, through the redemption date (which will be based on an annual rate equal to three-month LIBOR, determined as of May 13, 2021, or 0.15588%, plus 5.785%), and (ii) 1,248,000 units of its 8.125% Fixed Rate/Floating Rate Common Securities, Series 2 (the "Common Securities") (constituting approximately 84.467% of the outstanding Common Securities) at a par price of $25.00 per unit, plus all accrued and unpaid distributions thereon through the redemption date. Ally is also redeeming 42,848,000 units of its 8.125% Fixed Rate/Floating Rate Junior Subordinated Deferrable Interest Debentures due 2040 (the "Debentures" and, together with the TRUPS and Common Securities, the "Securities") (constituting approximately 84.467% of the outstanding Debentures) held by the Trust at a par price of $25.00 per unit, plus all accrued and unpaid dividends through the redemption date. The Trust's redemption of the called TRUPS and Common Securities will occur concurrently with Ally's redemption of the called Debentures, all of which are held by the Trust. The proceeds from the redemption of the called Debentures will be applied to redeem the called TRUPS and Common Securities.

The redemption date will be July 2, 2021, for the Securities called for redemption. Redemptions will be on a pro rata basis for the TRUPS (as nearly as practicable without creating fractional units). Securities held through the Depositary Trust Company ("DTC") will be redeemed according to the applicable procedures of DTC. After the redemption date, interest and distributions, as applicable, on the Securities called for redemption will cease to accrue.

The notice of redemption and related materials were delivered today to registered holders of record of the Securities. Questions relating to, and requests for additional copies of, the notice of redemption and related materials should be directed to the trustee for the Securities, The Bank of New York Mellon, 240 Greenwich Street – Floor 8W, New York, New York 10286, Attention: Corporate Trust Administration.

About Ally Financial

Ally Financial Inc. (NYSE: ALLY) is a digital financial services company committed to its promise to "Do It Right" for its consumer, commercial and corporate customers. Ally is composed of an industry-leading independent auto finance and insurance operation, an award-winning digital direct bank (Ally Bank, Member FDIC and Equal Housing Lender, which offers mortgage lending, point-of-sale personal lending, and a variety of deposit and other banking products), a corporate finance business for equity sponsors and middle-market companies, and securities brokerage and investment advisory services. A relentless ally for all things money, Ally helps people save well and earn well, so they can spend for what matters. For more information, please visit www.ally.com and follow @allyfinancial.

For more information and disclosures about Ally, visit https://www.ally.com/#disclosures.

For further images and news on Ally, please visit http://media.ally.com.

Contact:
Jillian Palash
Ally Communications (Media)
704-644-6201
jillian.palash@ally.com

Daniel Eller
Ally Investor Relations
704-444-5216
daniel.eller@ally.com

 

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SOURCE Ally Financial

FAQ

What is Ally Financial's recent announcement regarding TRUPS?

Ally Financial announced a partial redemption of approximately 84.467% of its 8.125% Fixed Rate/Floating Rate Trust Preferred Securities.

What is the redemption date for Ally Financial's securities?

The redemption date for the securities is set for July 2, 2021.

How many units of Junior Subordinated Debentures does Ally Financial plan to redeem?

Ally Financial plans to redeem 42.848 million units of its Junior Subordinated Debentures.

What is the par price for the securities being redeemed by Ally Financial?

The par price for the securities being redeemed is $25.00 per unit.

What percentage of the outstanding securities is being redeemed by Ally Financial?

Approximately 84.467% of the outstanding Trust Preferred Securities and Common Securities are being redeemed.