Report: Congressional panel doubts GMAC business case, suggests breakup
Filed under: Government/Legal, Earnings/Financials
“The panel is deeply concerned that Treasury has not required GMAC to lay out a clear path to viability or a strategy for fully repaying taxpayers.” This, according to a Congressional Oversight Panel that was created as a watchdog for the U.S. Treasury’s Troubled Asset Relief Program (TARP) funds. The fix? Potentially breaking GMAC up into units and merging its auto lending business back into General Motors.
As a refresher, the Treasury invested $17.2 billion in TARP funds into GMAC, after which the financial company lost $8.3 billion on its Residential Capital unit in 2009. For it’s part, Treasury has responded to the panel in a statement, saying, “Treasury continues to be a reluctant shareholder and to manage its investment in GMAC in a hands-off commercial manner consistent with the administration’s established principles that guide Treasury’s management of financial interests in private firms.”
And since we’ve heard from the congressional panel and Treasury, why not from GMAC itself? Again, from a statement as reported to Automotive News: “We appreciate the panel’s responsibility to analyze history; however, GMAC’s management team is focused on the future. That includes continuing to provide the highest level of service to auto dealers and consumers in support of our auto partners, returning GMAC to a high level of profitability, and repaying the U.S. Treasury.”
At this point, there’s no clear indication on how Treasury or the congressional panel will proceed. Regardless, this is an issue that we’ll be keeping a close eye on in the coming weeks. Stay tuned.
[Source: Automotive News - sub. req'd. | Image: Craig Jones/Getty]
Report: Congressional panel doubts GMAC business case, suggests breakup originally appeared on Autoblog on Fri, 12 Mar 2010 13:58:00 EST. Please see our terms for use of feeds.
Tags: a-clear-path, a-close-eye, auto, entry, general-motors, gmac financing, gmacfinancial, image, oversight-panel, troubled-asset, us treasury
Why Obama’s $90 Billion Bank Tax Is Fair Play
Jan 14, 2010 Object
The White House is poised to propose a $90 billion tax on big banks to recoup losses from the Troubled Asset Recovery Program (TARP). After all the repayments banks have to make under TARP’s original conditions, the government now expects losses of $117 billion to remain. If that’s the case, the tax would be kept in force until the full amount of losses is recouped. The remaining losses so far come mostly from three money-eating “investments” — American International Group (AIG), General Motors and Chrysler.
Continue reading Why Obama’s $90 Billion Bank Tax Is Fair Play
Why Obama’s $90 Billion Bank Tax Is Fair Play originally appeared on DailyFinance on Thu, 14 Jan 2010 11:20:00.
Filed Under: JP Morgan Chase, General Electric , Goldman Sachs , Morgan Stanley , American International Group, INC., Bank of America, Citigroup
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Why Obama’s $90 Billion Bank Tax Is Fair Play
Tags: america, billion-bank, general-motors, international, morgan-chase, troubled, troubled-asset, white-house
Government report card: TARP is a success!
Jul 20, 2009 Object
Filed under: Economy
It is bad enough that most people in the U.S. now know that TARP stands for Troubled Asset Relief Program. Of course, TARP has not really relieved anyone of their troubled assets but it has paid for billions in bonuses and precious few loans. But that has not stopped the U.S. from creating an even longer, new acronym for us to learn — special inspector-general for the troubled asset relief program (SIGTARP).
SIGTARP is run by a fellow named Neil Barofsky. And SIGTARP has conducted a survey that concludes TARP is a big success! Unfortunately, there is no independent verification of the results of the survey and the research conducted privately contradicts its findings — but who cares? Actually, I do — because SIGTARP now says the cost of the financial bailout — only $700 billion of which is the TARP — could nearly double from $12.8 trillion to $23.7 trillion, nearly twice U.S. Gross Domestic Product!
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Government report card: TARP is a success! originally appeared on DailyFinance on Mon, 20 Jul 2009 14:45:00 EST. Please see our terms for use of feeds.
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Government report card: TARP is a success!
Tags: a-friend-via, a-hedge-for, generated-lots, gross-domestic, has-conducted, hedge-against, neilbarofsky, relief-program, sigtarp, troubled-asset
Hank Paulson to defend his threat to fire Bank of America’s Ken Lewis
Jul 15, 2009 Object
Hank Paulson, the ex-Dartmouth football player who bulldozed his way into making the world safe for Goldman Sachs Group (GS), is at it again. You’ll recall last fall when he persuaded Congress that the world would end unless it passed $750 billion for the Troubled Asset Relief Program (TARP) to buy up Wall Street’s toxic waste.
Then he made sure to bail out American International Group (AIG) to the tune of about $180 billion so Goldman, which he ran before his trip to Washington, could get $12.9 billion more in a 100-cents-on-the-dollar settlement for its part in a credit default swap with AIG.
And finally, Paulson forced Bank of America (BAC) to acquire the down-on-its-luck Goldman competitor Merrill Lynch. As it turns out, there seems to be some controversy over whether Paulson threatened to fire B of A CEO Ken Lewis if he pulled out of the Merrill deal.
Continue reading Hank Paulson to defend his threat to fire Bank of America’s Ken Lewis
Hank Paulson to defend his threat to fire Bank of America’s Ken Lewis originally appeared on DailyFinance on Wed, 15 Jul 2009 13:20:00 EST. Please see our terms for use of feeds.
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Hank Paulson to defend his threat to fire Bank of America’s Ken Lewis
Tags: america, congress, entry, football-player, goldman, goldman-sachs, merrill-lynch-, threat, troubled, troubled-asset
