GMAC to Receive $3.8 Billion More in Government Aid
Financing arm of General Motors poised to get third infusion of federal support.
Dec. 30, 2009— -- GMAC, the ailing financing arm of General Motors, is set to receive $3.8 billion in government aid, ABC News has learned. The funds will be the third infusion of federal support for the troubled lender.
The Treasury Department said that the latest injection of $3.8 billion was actually less than the $5.6 billion that it had expected to loan GMAC to keep the finance giant from collapsing.
The latest government aid will bring the total federal assistance for GMAC to $16 billion when combined with the $12.5 billion that the lender has already received dating back to December 2008. Due to its prior cash infusions, the government already owns 35 percent of GMAC.
"These actions offer the best chance for GMAC to complete its overall restructuring plan and return to the private capital markets for its debt financing and capital needs in 2010," Treasury said in its press release. "We are pleased that we could complete this restructuring of our investment with $1.8 billion less capital than was projected in May."
GMAC was the only one of 10 banks that was unable to fill the capital hole exposed by the government's stress tests last spring. The other nine banks all succeeded in raising necessary capital through the private sector.
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