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GMAC in Talks for More Taxpayer Bailout

Wednesday, 28 Oct 2009 08:30 AM

WASHINGTON-- U.S. auto finance giant GMAC is in "advanced talks" with the US Treasury to receive a third injection of taxpayer funds, the Wall Street Journal said Wednesday.

The new injection -- worth between 2.8 billion and 5.6 billion dollars -- would come via an issue of preferred stock, the financial daily said, citing sources familiar with the discussions.

The US government, which has already put 12.5 billion dollars into the lender, owns just over one third of GMAC, the former financial arm of ailing auto giant General Motors and now jointly owned by GM and Cerberus Capital Management.

According to the Journal report, the Treasury is open to discussions of a further taxpayer bailout because officials recognize GMAC's pivotal role in the US auto industry's revival.

GMAC's daily operations are also being shored up by the authorities, with the US government bank insurer FDIC informing the lender it will guarantee an additional 2.9 billion dollars in debt, the newspaper said.

Amid the turmoil of the market's slump late last year, GMAC won approval to become a bank holding company with greater access to state credit lines.

Copyright © 2009 AFP. All rights reserved.

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WASHINGTON-- U.S. auto finance giant GMAC is in "advanced talks" with the US Treasury to receive a third injection of taxpayer funds, the Wall Street Journal said Wednesday.The new injection -- worth between 2.8 billion and 5.6 billion dollars -- would come via an issue of...
gmac
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2009-30-28
Wednesday, 28 Oct 2009 08:30 AM
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