Ally Financial is weighing a sale of all or part of its auto lending and banking businesses, Reuters reported last week - and some analysts are targeting Wells Fargo & Co. as a possible buyer.
A research note from Keefe, Bruyette & Woods today said Wells, which bought Charlotte’s Wachovia in 2008, is a “likely buyer” for Ally’s North American Auto Finance business. The San Francisco-based bank is one of the few large lenders with the interest and balance sheet to take down the entire business, KBW analysts said.
They believe Wells would be interested in acquiring the business because of Ally’s market share and Wells’ excess liquidity to buy assets, they said. Other lenders that might be interested in part or all of the business include JPMorgan and U.S. Bank, the analysts said.
"A purchase of the auto finance business would give Wells a much larger industry presence in a line of business where WFC already competes," the KBW report said. "... Overall, we believe that the market would view this as a good deal for Wells Fargo."