Ally Doesn't Seem to Fear PLS Buybacks

If you were listening to Ally Financial's fourth quarter earnings conference call this morning (as I was) you would've been struck by two things: (1)Boy, this company loves all facets of the auto finance business (2)it doesn't seem to fear, in the least, residential buyback claims from investors who bought GMAC's nonprime MBS during the go-go years.  It also appears that the company may've inked a sweet deal with Fannie Mae, paying $462 million to the GSE to settle buyback liability tied to $292 billion of originations. (The sweet part: no worries on future claims.) Company officials tried to portray the nine-month Fannie buyback talks as hard fought with neither side being a "pushover." But think about this: Fannie is owned by Uncle Sam, who also owns 73.8% of Ally, the parent of ResCap/GMAC. And when Ally goes public Uncle hopefully gets back the $15 billion it pumped into the bank holding company. We shall see. Meanwhile, Ally executives portrayed the PLS buyback claims as being, well, nebulous, noting that the original reps and warranties on these non GSE bonds favored the issuer, not the investor. Then again, keep in mind that the titans of Wall Street who made the subprime and alt-A MBS market into a Frankenstein monster, operated under this premise: We're Wall Street. We're big boys. We know what we're doing…