Not sure how I missed this, but the WSJ reported last week that Ally Financial recently failed one of the Fed’s stress tests. They tested the 18 biggest banks in the country and 17 passed.
Apparently their “Tier 1 Common” ratio came in too low (1.5% vs. a required 5%), though they have responded that the Fed’s tests are inherently flawed, arguing that:
“Ally continues to have strong capital levels and ample liquidity to support its automotive finance operations. In addition, Ally Bank continues to be a well-capitalized bank with a leading position in the market.”
And, indeed, they score quite well on other measures — e.g., their Texas ratio is a little under 3.5%, which is excellent.
I’m not sure about you, but I’m not particularly worried. We have a chunk of cash in Ally Bank CDs and we’re well below FDIC insurance limits.
While their rates aren’t quite as competitive as they used to be, the loyalty bonus when renewing CDs puts them back near the top.
Source: WSJ.com via Bargaineering
I have lost faith and trust in Ally. I don’t care if FDIC insured it all may boil down to access. They should not still be in this much trouble and being majority owned by the government.
I am pulling out slowly for stable institutions.
I also have money in Ally. Did pay much better when I first started but still so much better than my neighborhood bank. I am not worried about my money but I would hate to see them fail.
Thats the beauty of FDIC. Trust in the regulators to shut down bad banks, in the meantime know that your money is safe and insured. I cant image how it was in the 20s with bank runs and banks refusing to cash each others checks. We have a good system, and we don’t have to worry about picking the wrong bank and losing ones savings.