UPDATE 3-GMAC posts $5 billion 4th quarter loss

* Wrote down bad mortgage assets in Q4

* Said in Dec it did not expect more major mortgage losses

(Adds comments from conference call)

NEW YORK, Feb 4 (BestGrowthStock) – GMAC Financial Services, a
lender that is majority-owned by the U.S. government after
multiple bailouts, 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 it did not expect major losses from
its mortgage unit after the fourth quarter. Home loans fueled
GMAC’s growth earlier this decade, but have since triggered
billions of dollars of losses for the company.

But even if it has controlled its mortgage losses,
questions loom about its future as an independent company,
analysts said.

GMAC was previously the auto financing unit of General
Motors. In 2006, GM sold a controlling stake in the company. As
an independent company and now a regulated bank holding
company, GMAC has less capacity to take credit risk when
lending to car buyers, which could inhibit GM’s car sales.

The U.S. government owns 61 percent of GM and 56 percent of
GMAC. An analyst on the GMAC conference call on Thursday asked
if the common ownership has spurred talk of recombining the two
companies.

GMAC Chief Executive Michael Carpenter said there is no
discussion on recombining the companies and added that, as
separate companies, financing costs are more explicit instead
of amounting to hidden subsidies to a car sale.

“In the long term that is actually positive for the auto
companies, because it forces them to make an economic decision
in a very rigorous way,” Carpenter said.

GMAC is also the preferred lender for Chrysler car sales
and finances dealer inventories.

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
Chief Executive Al de Molina.

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.

Stock Market Analysis

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

UPDATE 3-GMAC posts $5 billion 4th quarter loss