According to Fortran 95 standard, allocatable arrays/objects are deallocated automatically at subroutine exit, when they go out of scope.  For the previous 5 years, it was necessary to deallocate explicitly.  You are entitled to deallocate explicitly if you wish.  The Fortran system is entitled also to deallocate other local variables which don't have SAVE declarations, as a C compiler would do with auto variables.
If you had SAVE variables and called multiple concurrent instances of the subroutine, you would have a storage clash, analogous to C static variables.