Impact of SEC Fee Rate Reduction on Revenue and Margins
The SEC fee rate was reduced to zero halfway through Q2 2025, which would have decreased commission revenue by approximately $15 million if it had been in effect for the entire quarter.
Despite the fee reduction, overall commission revenue still increased by 27% year-over-year, reaching a record $516 million.
Management highlighted that the SEC fee is a pass-through cost to clients and does not impact profitability directly.
The reduction in SEC fees reflects regulatory changes that could influence future revenue streams and cost structures.
This development underscores the company's ability to adapt to regulatory shifts while maintaining strong financial performance.
Adjusted non-interest expense was $1.3 billion, down 4% sequentially and 2% year over year, with controllable expenses down for the seventh consecutive quarter.
Ally Financial delivered adjusted earnings per share of $0.99 and core pre-tax income of $480 million in Q2 2025, showing double-digit year-over-year growth.
Consolidated net charge-off rate declined 40 basis points sequentially to 1.10%, with retail auto NCO rate down 37 basis points sequentially to 1.75%.
Core ROTCE was 13.6% in the quarter, or 10% excluding AOCI effects.
Corporate finance delivered a 31% ROE with core pre-tax income of $96 million and loan balances up $1.3 billion year over year.
GAAP earnings per share were $1.04 for the quarter, with adjusted EPS at $0.99.
Insurance business recorded a core pre-tax loss of $2 million due to higher losses despite premium growth.
Net interest margin excluding core OID expanded 10 basis points quarter over quarter to 3.45%, offsetting a 20 basis point drag from the credit card business sale.
Retail auto originations reached $11 billion with 3.9 million applications, the highest quarterly volume ever for the second consecutive quarter.
Adjusted EBITDA for the quarter was $220 million, a 1% increase year-over-year, including $5 million in net performance fee earnings.
Alternative assets under management increased by 20% in the first half of 2025, with $55 billion added, reaching $331 billion in total alternative AUM.
Fee-related earnings grew 4% year-over-year, driven by higher average AUM and organic growth in alternative strategies, partially offset by outflows in fundamental equity strategies.
In Q2 2025, AMG reported a 15% year-over-year growth in economic earnings per share, reaching $5.39.
Net client cash flows exceeded $8 billion in Q2, with record inflows into alternative strategies.
Share repurchases totaled approximately $100 million in Q2 and $273 million year-to-date, contributing to earnings per share growth.
Record Net Interest Income and Margin Expansion in 2Q 2025
First BanCorp achieved record net interest income of $215.9 million, with an 8 basis point increase in net interest margin to 4.56%.
Margin improvement was partly due to reinvestment of maturing securities and lower funding costs, with an expected continued 5-7 basis point increase in the coming quarters.
Exclusion of one-time fees from early loan cancellations shows underlying margin strength.
Dafinchi