Reuters: Bankruptcy News: Ally Financial looking to further exit mortgage business

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Ally Financial looking to further exit mortgage business Oct 26th 2012, 12:59 Fri Oct 26, 2012 8:59am EDT Oct 26 (Reuters) - Ally Financial Inc's banking subsidiary on Friday said it is looking to sell much of its remaining mortgage business. Ally Bank said it is exploring strategic alternatives for its agency mortgage servicing rights portfolio and its business lending operations. The portfolio had $122 billion of mortgage loans in the third quarter of 2012. The move is Ally's latest step to exit the mortgage lending business to focus on its U.S. auto lending and banking operations. Its Residential Capital LLC mortgage unit filed for bankruptcy in May and the assets were bid on this week in a bankruptcy auction. [ID: nL1E8LPG33] Ally, which is majority owned by the U.S. government after a series of bailouts during the financial crisis, is also selling international operations in a bid to pay back taxpayers. Ally is the former auto lending arm of General Motors Co. [ID: nL1E8LN21R] "Going forward our goal is to focus on our customer-centric deposit activities as well as supporting Ally's auto finance operation," said Ally Bank President Barbara Yastine in a statement. The business lending unit buys mortgages from other correspondent lenders and brokers. Ally started reducing volume in its correspondent lending business in November 2011. Ally said it will continue making a "modest level" of high-quality residential jumbo mortgages for its own portfolio through correspondents and wholesale brokers.

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