GMAC Financial Services today announced that its application to become a bank holding company under the Bank Holding Company Act of 1956, as amended, has been approved by the Board of Governors of the Federal Reserve System. In addition, GMAC Bank has received approval from the Utah Department of Financial Institutions (UDFI) to convert to a state bank.
As a bank holding company, GMAC will have expanded opportunities for funding and access to capital, which will provide increased flexibility and stability.
“Today’s announcement marks a key turning point in GMAC’s history,” said GMAC Chief Executive Officer Alvaro G. de Molina. “As a bank holding company, GMAC will be competitively positioned for the long-term to provide financing to auto and mortgage consumers and businesses such as automotive dealers. GMAC has been a leader in these sectors and it is critically important to our company and the broader economy to resume responsible lending to consumers and businesses.”
GMAC’s previously announced separate private debt exchange offers and cash tender offers were subject to the approval of the bank holding company application. The offers are ongoing and will expire on Dec. 26, 2008 at
11:59 p.m. EST.
Being one of the top mortgage companies in the past, GMAC has been killed by the housing collapse. Hopefully the TARP money and access to the Fed window will right the ship.
I am all about the free market theories and letting it take its course, but if other companies were getting TARP funds for bad mortgages to me it made sense to let GMAC get some as well.
Now they just need to hire someone that can actually price residuals on leases correctly :smash2:
Also,
“The Fed order says GM will reduce its stake to less than 10 percent of the voting and total equity interest of GMAC. GM’s remaining equity interest in GMAC will be transferred to an independent government-accepted trustee who must dispose of the equity held in the trust within three years of the trust’s creation. Cerberus, which led an investment group that bought a 51-percent stake in GMAC from the automaker for $14 billion in 2006, will reduce its stake in GMAC to no more than 33 percent of the lender’s total equity.”
Right, a company which owns a large number troubled mortgages is looking to get money from a fund set up by the government to help these companies.
Why would they not apply? If the government wants to give me money I am not going to turn it down.
Feel free to send you stimulus check back to the government if you don’t like the concept.
If you are total against the TARP fund and would have rather seen the free market destroy itself then that is a different argument.
i like how i work for the biggest bank in the world and we didn’t take a dime of government money and as such are losing ground relatively to our competitors who took the free money and used it for everything but its intended purpose.
Ugh, no shit. I accepted my job offer in January with the promise of a 10% bonus if I had at least a 3/5 performance review and then they accidentally it. The whole thing.
Amex already had a bank arm but it converted other ones. Yes to gather more access to funding but its not like these other companies that never had bank status. Its kind of disgusting actually
The financing arm of General Motors Corp. still wouldn’t say on Saturday if it had met a midnight deadline to clear a final hurdle in its bid to become a bank holding company and gain access billions in federal bank bailout money.
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GMAC Financial Services LLC had received the Federal Reserve’s approval earlier in the week, but needed to complete a complicated debt-for-equity exchange by 11:59 p.m. EST Friday.
The Treasury Department said that it will provide $5 billion to GMAC Financial Services LLC, the ailing financing arm of General Motors Corp., in a move that’s expected to stave off a bankruptcy protection filing at the company but also severely limit GM’s control over it.
Also;
DETROIT, Dec. 30 — GM today announced new reduced rate financing as low as 0% APR for up to 60 months on select new cars and trucks. The reduced rate financing is available to qualified buyers today through Jan. 5, 2009 on many 2008 and select 2009MY vehicles (see list below). Of note, many of the vehicles listed below have stackable bonus cash and/or dealer cash ranging from $500 to $4,250.
“We’re very excited to offer this reduced rate financing through GMAC to encourage our customers to get back into the game,” said Mark LaNeve, vice president, GM North America Vehicle Sales, Service and Marketing. “This enables even more qualified customers to finance through GMAC at their local GM dealership, and provides additional financing capacity with conventional and reduced rate APRs for our dealers to make sales. With GM’s Financing That Fits, and the Red Tag Sale now underway that offers supplier pricing, customers have an opportunity to get a variety of extremely attractive offers through the end of the year.”
Now buying down to 620 paper again
and something I have not seen published was 0% financing for up to 60 months on some cars and reduced rates on others. Stacked on top of other deals going on.
