Ally Financial Inc.'s fourth-quarter adjusted EPS of 70 cents exceeded analysts' expectations by 9 cents and, and the company completed a fiscal year that saw its highest revenue and adjusted EPS numbers since going public.
CEO Jeffrey Brown said Ally expects growth tailwinds from recently enacted federal tax reform that lowered the corporate rate as the company transitions its auto finance business. Fourth-quarter 2017 net income declined by $67 million to $181 million due to a revaluation of Ally's net deferred tax assets associated with federal tax reform. Pretax income saw a $30 million increase year over year due to higher net finance revenue, partially offset by higher provision for loan losses and higher noninterest expense.
Santander Consumer USA Holdings Inc. posted adjusted EPS of 27 cents for the fourth quarter, missing analysts' expectations by 3 cents when factoring in tax reform and related items, legal reserves and a settlement with its former CEO. Tax reform added $652 million to the company's 2017 net income and reduced the company's tax rate from 36% to a little more than 21%, President and CEO Scott Powell said during a conference call to discuss earnings for the period.

