GM Financial, General Motors’ captive finance arm, reported net income of $59 million for the fourth quarter of 2014, down $62 million, or 51 percent, from the $121 million it earned in the fourth quarter of 2013.
The General’s finance division cited one-time charges as the biggest reason for the results. For the quarter, one-time charges included costs related to acquiring overseas operations from Ally Financial, integration costs for GM Financial’s growing operations, and costs related to discontinuing the Chevrolet brand in Europe.
On a bright side, loan and lease originations for the United States and Canada were $4 billion, more than doubling the $1.8 billion recorded a year ago. Originations for international operations, meanwhile, were $2 billion, down from $2.1 billion a year ago.
GM Financial was created after General Motors acquired subprime lending specialist AmeriCredit in 2010 with the objective of creating an in-house source of financing and leasing for consumers as well as commercial “floorplan” leases to dealers. Since the acquisition, GM has progressively turned the unit into a full-fledged captive finance unit with those capabilities. One of GM Financial’s first steps was to add leasing capability to its lineup of financial offerings, while adding lending to consumers with prime credit in 2014.
In February, GM made lease incentives for the Buick and GMC brands exclusively available through GM Financial. It will done the same for Cadillac in March, while Chevrolet is officially under consideration, and is unofficially expected to follow in the footsteps of Buick-GMC and Cadillac later in 2015.