GMAC next in line for Treasury bailout
TEXT OF STORY
Steve Chiotakis: Reports are this morning that the Treasury Department is about to dole out billions of more dollars to the GMAC, what at one time was a huge financing arm of General Motors.
It’s a deal that could happen as early as today. From North Carolina Public Radio, here’s Marketplace’s Janet Babin.
Janet Babin: GMAC already received $5 billion from the Troubled Asset Relief Program or TARP program back in December. Now, the Detroit News and other papers are reporting that the government is set to loan GMAC more than $7 billion additional dollars.
With the additional infusion, the federal government’s stake in GMAC will get even bigger. A U.S.-controlled GMAC would have the power to offer better loan terms to GM and Chrysler car buyers.
This could be a way of steering business to the troubled companies. Analysts say that could give them an edge over their competitors, like Ford, that hasn’t taken any bailout money.
Last week, GMAC changed the name of its banking unit to Ally bank to distance itself from the bailout.
I’m Janet Babin for Marketplace.
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