FORT WORTH, Texas —GM Financial reported this week that consumer loan originations in North America dropped about $200 million from a year ago to just less than $1.3 billion for the quarter ending on Sept. 30. But its chief executive said there’s a good reason for the drop.

“The shortfall was driven by increasing competitive conditions in the U.S. [market], specifically competition in the subprime arena,” said Dan Berce, president and CEO, noting that the environment has led to stretching loan terms, higher loan-to-value ratios and reduced pricing. “We’ve chosen to maintain good discipline on the credit and pricing front, so we’ve actually forgone a bit of volume to keep our profitability and credit standards where they have been.”

GM financial reported solid profitability for the quarter, with $239 million in pretax earnings — $175 million in North America and 63 million in international markets — up from $200 million in the year-ago quarter. Net income was $161 million, up from $123 million in the year-ago quarter. For the first nine months ending Sept. 30, net income was up from $372 million to $445 million.

Berce reported that credit metrics in North America continue to normalize, with slightly higher delinquencies and losses year over year. But overall, he added, credit metrics remain below historical standards.

Annualized credit losses were 1.9 percent of average consumer finance receivables for the quarter, compared to 2.5 percent in the year-ago quarter. For the first nine months of the year, annualized consumer net credit losses were 1.9 percent compared to 2.2 percent last year. In North America, annualized credit losses as a percent of average consumer finance receivables were 2.8 percent and 2.5 percent, respectively, for the quarter and first nine months of the year.

Thirty-to-60-day delinquencies accounted for 3.8 percent of GM Financial’s portfolio for the quarter, compared to 5.2 percent one year ago. Accounts more than 60 days delinquent were 1.5 percent of the portfolio for the quarter, down from 1.9 percent one year ago.

“From an historical perspective, these numbers are quite good compare to anything we’ve seen in the past,” Berce noted. “Performance of our GM new volume remains in line or even better than non-GM volume from a credit standpoint.”

Berce said the company’s focus in the North American market remains on subprime loan originations and full-spectrum leases in both the U.S. and Canadian markets. He also reported that the company continues to make progress in helping General Motors increase its penetration in both areas, noting that subprime loan penetration and net demographic remains above the industry high (6.1 percent) at 7.8 percent.

Combined, North American consumer loan and GM lease originations totaled $2 million, with lease originations accounting for $727 million of that total. Combined with International consumer loan originations, the company originated $3.2 billion for the quarter.

“This is an area we have seen a lot of growth year over year,” Berce said of the company’s leasing business, noting that the portfolio about doubled year over year at the end of the quarter. “GM has emphasized more leasing in 2013. It’s approaching the industry average, and one of our goals is to support the increased penetration by obtaining a meaningful share of the lease market.

Berce added that 67 percent of loan originations during the quarter were for new GM vehicles, adding that the percentage is higher in International markets where the company is expanding its footprint with the acquisition of Ally’s auto finance and financial services operations in Germany, the United Kingdom, Italy, Sweden, Switzerland, Austria, Belgium, the Netherlands, Spain, Chile, Columbia and Mexico, France and Portugal earlier this year.

The executive also reported that the company completed its acquisition of Ally’s Brazilian operations on Oct. 1 for $611 billion, and said the company expects to complete its acquisition of Ally’s operations in China by the middle of 2014. He added that with the acquisition of Ally’s Brazilian operations, the company’s originations for the quarter were closer to $4 billion.

Berce also reported that the company is on track to release a prime product by the middle of 2014, which he said could improve other area of the company’s business.

“We believe the existence of that product should accelerate the growth in our commercial product,” he said, noting slow growth in the company’s commercial business.