Breaking News
FONT-SIZE Plus   Neg
Share SHARE

US Treasury Losses $11.2 Bln On 2008 TARP Bailout Of General Motors

RELATED NEWS
Trade GM now with 

The U.S. Treasury has realized a loss of $11.2 billion on its bailout of automaker General Motors Co. (GM: Quote) during the height of the financial crisis in 2008, according to a quarterly report submitted to the Congress dated April 30, 2014 from the office of the Special Inspector General for the Troubled Asset Relief Program or TARP.

The loss on the bailout also includes $826 million that the Treasury wrote off on March 30, 2014 as administrative claim in the company's 2009 bankruptcy, ending all taxpayer involvement with General Motors.

The bailout enabled the largest U.S. automaker General Motors to avoid liquidation and to restructure under a bankruptcy filing in 2009.

In return for a total of $49.5 billion in bailout loans to General Motors, the Treasury received $6.7 billion in debt in General Motors, $2.1 billion in preferred stock and a 61 percent common equity stake. The Treasury sold its last shares in General Motors on December 9, 2013.

The report states that taxpayers have lost $11.2 billion on the principal TARP investment in General Motors as of March 31, 2014.

Under the Treasury's Automotive Industry Support Programs or AIFP, the taxpayers had lost a total of $14.9 billion, including $845 million on the sale of Ally Financial's common stock, as well as $2.9 billion on the principal TARP investment in Chrysler Holding LLC.. Meanwhile, Chrysler Financial Services Americas LLC fully repaid its TARP investment.

As of March 31, 2014, a total amount of $79.7 billion had been disbursed through the AIFP and its subprograms, and Treasury had received $59.1 billion in principal repayments, preferred stock redemption proceeds, and stock sale proceeds.

The report revealed that the Treasury had received about $38.9 billion related to its General Motors investment, $10.7 billion related to its Ally Financial/GMAC investment, $8 billion related to its Chrysler investment, and $1.5 billion related to its Chrysler Financial investment as of March 31, 2014.

As of March 31, 2014, Ally Financial, formerly GMAC Inc., remains the only auto-related company whose stock is currently owned by Treasury. The taxpayers were owed $6.5 billion, however, following the IPO on April 10, 2014, taxpayers are now owed $4.1 billion for TARP's investment in Ally Financial.

GM closed Wednesday's regular trading session at $34.48, up $0.49 or 1.44% on a volume of 14.04 million shares.

Register
To receive FREE breaking news email alerts for General Motors Company and others in your portfolio

by RTT Staff Writer

For comments and feedback: editorial@rttnews.com

Business News

Editors Pick
Australia's international cricketer Phillip Hughes, who sustained critical injury after being hit on the head by a ball during a domestic match Tuesday, has died. The 25 year-old promising player had been fighting for his life for two days at St Vincent's Hospital in Sydney, in induced coma. Australian cricket team's doctor Peter Brukner said at a news conference Thursday that Hughes died as a After turning in a lackluster performance for much of the session, stocks managed to end Wednesday's trading mostly higher. The gains lifted the Dow and the S&P 500 to new record closing highs, while the Nasdaq reached its best levels since 2000. Half of Americans agree with the changes to immigration policy announced by President Barack Obama last week, according to a CNN/ORC poll, although a majority opposes using executive orders to implement those policies.
comments powered by Disqus
FREE Newsletters, Analysis & Alerts

 

Stay informed with our FREE daily Newsletters and real-time breaking News Alerts. Sign up to receive the latest information on business news, health, technology, biotech, market analysis, currency trading and more.