GMAC posts $5 billion Q4 loss

NEW YORK (BestGrowthStock) – GMAC Financial Services, a lender that is majority-owned by the U.S. government after multiple bailouts, said it lost $5 billion in the fourth quarter after writing down bad mortgage assets.

GMAC, one of the largest car loan makers in the United States, said in December that it did not expect to record more major losses from its mortgage unit. Home loans fueled GMAC’s growth earlier this decade but have since triggered billions of dollars of losses for the company.

Those massive losses combined with the broader credit crunch and General Motors’ bankruptcy filing hobbled GMAC, forcing it into the arms of the government and triggering the resignation of its Chief Executive, Al de Molina.

Michael Carpenter, formerly a Citigroup executive, was named new CEO in November, and is looking to turn the struggling lender around.

The fourth-quarter loss compares with net income of $7.5 billion in the fourth quarter of 2008.

The U.S. Treasury owns 56 percent of GMAC’s common stock as well as other GMAC securities after supporting the company multiple times, most recently in December.

Stock Market Research

(Reporting by Dan Wilchins; editing by John Wallace, editing by Dave Zimmerman)

GMAC posts $5 billion Q4 loss