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GMAC will be getting more money….again

GMAC…..the mortgage and lending people…not the car people…. are going to get another $3.5 billion to help it get back on its feet……the money will come from the tarp funds set aside last year…….

Despite the government aid, GMAC remains on shaky financial ground. Last month, it reported a quarterly loss of $767 million. The company has struggled under the weight of its ailing mortgage lender, ResCap. The unit was a major dealer in sub-prime mortgages and is still suffering from soured loans it made during the housing boom. Some analysts have speculated that GMAC might have to shut down ResCap altogether.

However, a bright spot for GMAC has been Ally Bank, its online consumer banking unit. The bank has offered some of the highest interest rates on CDs in the industry, helping bring in billions of dollars in new deposits this year. But the rates have also irked rivals and drawn the attention of regulators, since as the rebranded banking unit of GMAC, Ally has the backing of billions of government dollars loaned to GMAC.

the company will probably need another infusion of about $2 to 5 billion……

What’s another billion here or there?

December 30, 2009 Posted by | Breaking News, Government, Media, Politics, The Economy | , , | Leave a comment

GMAC is back for another government cash injection……

The once giant auto maker is in talks with the Treasury Department for another loan of $2.8 to $5.6 billion dollars in stock…….The government would increase it’s holdings in the company from its current 35.4%…….

……..Here’s more from Charles Lemos over at mydd.com…….

The willingness by Treasury officials to deepen taxpayer exposure to GMAC reflects the troubled company’s importance to the revival of the auto industry. Founded in 1919, GMAC has $181 billion in assets and is a major financier for 15 million borrowers and thousands of General Motors and Chrysler car dealerships in the U.S.

The new capital would help firm up GMAC’s balance sheet and solidify its auto-loan business. GMAC provides the vast majority of wholesale financing for GM dealerships across the country, meaning scores of local distributors would be unable to bring new vehicles onto their lots if GMAC were to collapse.

Federal officials also are moving to shore up GMAC’s ability to fund its daily operations, with the Federal Deposit Insurance Corp. telling the company Tuesday the agency will guarantee an additional $2.9 billion in debt, according to people familiar with the discussions. The FDIC guarantee will make it easier for the company to sell debt to investors. The FDIC backed $4.5 billion in GMAC-issued debt earlier this year.


October 28, 2009 Posted by | Politics, The Economy | , , , , , | Leave a comment