("GMAC Won't File For Bankruptcy, Still Meets Obligations,"
published at 10:53 a.m. EDT Monday, misstated GM's stake in GMAC. A
corrected version follows.)
DOW JONES NEWSWIRES
GMAC Financial Services said Monday the finance company doesn't
intend to seek protection under the U.S. Bankruptcy Code and
continues to meet all its obligations.
General Motors Corp. (GM), which filed for bankruptcy protection
Monday morning, owns less than 10% of cash-strapped GMAC. The
lender got a $5 billion capital infusion under the U.S. Treasury
Department's Troubled Asset Relief Program as it became a bank
holding company several months ago.
As a creditor of GM, GMAC said it is taking the "appropriate
steps" to protect its interests during the auto maker's
restructuring. GM has submitted a motion to the bankruptcy court
that would allow its direct business with GMAC to continue during
the bankruptcy case.
GM's prepackaged plan leaves the federal government in control
of a downsized auto maker, faced with the weakest market conditions
in a generation.
Last month, GMAC said its first-quarter loss widened as credit
woes continued to mount and weak economic conditions hurt results.
Still, the company said it was seeing some improvement in mortgage
origination, as the beleaguered Residential Capital LLC unit posted
a narrower loss but continued to struggle with high credit
costs.
-By Lauren Pollock, Dow Jones Newswires; 201-938-5964;
lauren.pollock@dowjones.com