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Posted 27 March, 2024

Ally Financial Inc. appointed Michael G. Rhodes as new CEO

NYSE:ALLY appointed new Chief Executive Officer Michael G. Rhodes in a 8-K filed on 27 March, 2024.


  Ally Financial Inc. ("Ally") announced on March 27, 2024 that its Board of Directors appointed Michael G. Rhodes, 58, as the Chief Executive Officer and member of the Board of Ally and Ally Bank, effective on April 29, 2024 (the "Effective Date").  

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Overview of Ally Financial Inc.
Financial Services • Banking
Ally Financial, Inc. engages in the provision of online banking, securities brokerage, and investment advisory services. It operates through the following segments: Automotive Finance Operations, Insurance Operations, Mortgage Finance Operations, Corporate Finance Operations, and Corporate and Other. The Automotive Finance Operations segment offers retail installment sales contracts, loans, and operating leases, offering term loans to dealers, financing dealer floor plans and other lines of credit to dealers, warehouse lines to automotive retailers, fleet financing, providing financing to companies and municipalities for the purchase or lease of vehicles, and vehicle-remarketing services. The Insurance Operations segment focuses on consumer financial and insurance products such as vehicle service and vehicle maintenance contracts, and guaranteed asset protection. The Mortgage Finance Operations segment includes Ally Home Mortgage (ALM) offering and bulk purchases of high-quality jumbo and low-to-moderate income mortgage loans. The Corporate Finance Operations segment provides senior secured leveraged asset-based and cash flow loans to middle-market companies, with a focus on businesses owned by private equity sponsors. The Corporate and Other segment is involved in centralized corporate treasury activities such as management of the cash and corporate investment securities and loan portfolios, short- and long-term debt, retail and brokered deposit liabilities, derivative instruments, original issue discount, and the residual impacts of corporate funds-transfer pricing and treasury ALM activities. The company was founded in 1919 and is headquartered in Detroit, MI.
Market Cap
$11.0B
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Ally Financial Inc. by TradingView
Relevant filing section
Item 5.02. Departure of Directors or Certain Officers; Election of Directors; Appointment of Certain Officers; Compensatory Arrangements of Certain Officers.


Ally Financial Inc. ("Ally") announced on March 27, 2024 that its Board of Directors appointed Michael G. Rhodes, 58, as the Chief Executive Officer and member of the Board of Ally and Ally Bank, effective on April 29, 2024 (the "Effective Date"). When Mr. Rhodes assumes his role of Chief Executive Officer on the Effective Date, Douglas R. Timmerman who was appointed as Interim Chief Executive Officer of Ally and Ally Bank, effective as of February 1, 2024, will conclude his interim service and will continue in his previous role as President of Dealer Financial Services.


Mr. Rhodes has more than 25 years of experience in the financial services industry. Mr. Rhodes most recently served as the Chief Executive Officer and President of Discover Financial Services and President of Discover Bank, as well as a member of the Board of Directors of Discover Financial Services and Discover Bank. He joined TD Bank Group in 2011 to lead the North American Credit Card and Merchant Services business, and from 2017 to 2021, he also served as the Group Head, Innovation, Technology and Shared Services. Mr. Rhodes's experience also includes leadership roles at both Bank of America and MBNA America Bank. Mr. Rhodes earned his Master of Business Administration from the Wharton School of Business at the University of Pennsylvania and holds a Bachelor of Science in engineering from Duke University.


Mr. Rhodes has no family relationships with any director or executive officer of Ally or Ally Bank. There are no arrangements or understandings between Mr. Rhodes and any other person pursuant to which Mr. Rhodes was selected as the Chief Executive Officer of Ally or Ally Bank, and there are no transactions involving Mr. Rhodes that would be required to be reported under Item 404(a) of Regulation S-K.


In connection with Mr. Rhodes's appointment as Chief Executive Officer, the Compensation, Nominating, and Governance Committee of the Board (the "Committee") approved the following compensation package for Mr. Rhodes, the terms of which are set forth in an offer letter between Ally and Mr. Rhodes (the "Offer Letter"): (i) an initial annual base salary of $1 million; (ii) a total target incentive opportunity for fiscal 2024 of $10.5 million, with the actual amount earned payable after the end of 2024 in the form of a cash incentive (30%) and equity-based awards (70%), with such equity awards consisting 60% of performance-based stock units ("PSUs") and 40% of time-based restricted stock units ("RSUs"), each to be granted under the Ally Incentive Compensation Plan; and (iii) other employee benefits consistent with those provided to other similarly situated executives officers, including relocation benefits.


In addition, Mr. Rhodes will receive the following sign-on awards to make him whole for certain compensation he is forfeiting or otherwise foregoing from his prior employer in connection with his transition of employment: (i) a one-time cash award of $900,000, which must be repaid to Ally if his employment is terminated for cause or if he


voluntarily resigns within the first 12 months after the Effective Date; and (ii) make-whole equity grants with an aggregate grant date value of $16.2 million, which will consist of (x) $4.2 million (at target) in PSUs that will be earned and will vest subject to the same terms and conditions as those PSUs granted to the other Ally named executive officers in 2024 and (y) $12 million in RSUs that will vest one-third on each of December 11, 2024, December 11, 2025 and December 11, 2026, subject to his continued employment on such date and which will otherwise be subject to the terms and conditions that apply to our 2024 equity awards to our named executive officers.


Under the Offer Letter, if within 12 months after the Effective Date, Ally terminates Mr. Rhodes's employment without cause in the absence of a change in control, he will receive a lump sum cash payment equal to two times his then current annual base salary if and to the extent that the Ally Financial Severance Plan or a successor plan does not provide him with such a payment, subject to his signing and not revoking a release of claims against Ally and its affiliates. Mr. Rhodes will also be eligible for the Ally Financial Severance Plan, as in effect from time to time.


The foregoing description of the Offer Letter does not purport to be complete and is subject to, and qualified in its entirety by, the full text of the Offer Letter, a copy of which is attached hereto as exhibit 10.1.