Oh, I’m sorry, did you not notice that the organization that fed most of the profits to GM over the past decade or so was first sold and now trying to back-door into the financial bailout that is the TARP program? No?
Well, let me put you at ease. GMAC is clearly part of the vital infrastructure of our financial system, just like CitiBank and Bank of America…right?
GMAC Financial Services is a global finance company operating in and servicing North America, South America, Europe and Asia-Pacific. GMAC specializes in automotive finance, real estate finance, insurance, commercial finance and online banking. As of Dec. 31, 2007, the organization had $249 billion in assets and serviced 15 million customers.
Founded in 1919 as a wholly owned subsidiary of General Motors Corp., GMAC was established to provide GM dealers with the financing necessary to acquire and maintain vehicle inventories and to provide customers a means by which to finance vehicle purchases. The company’s products and services have since been expanded and now include three primary lines of business: automotive financing, real estate financing and insurance.
On Nov. 30, 2006, GM sold a 51 percent controlling interest in GMAC to a consortium of investors led by Cerberus Capital Management, L.P., a private investment firm, and included Citigroup Inc., Aozora Bank Ltd. and a subsidiary of The PNC Financial Services Group, Inc.
Honestly, if this doesn’t give you confidence that everything is going to be OK, I don’t know what will. I mean, auto financing, real estate financing, and insurance. That’s a heady mix of opportunity!
At least I’m sure it’s not just a ploy for Cerberus Capital Management to cash in on tax-payer loot, right? As noted in just a few short months ago: “Chrysler is still recovering from its split a year ago from its German partner, Daimler, and is undergoing a big revamping under Cerberus. Top executives at Cerberus have said they are determined to fix the company and that their $7.4 billion investment will pay off. A Cerberus spokesman said in a statement on Wednesday that it remained confident in its management of Chrysler and GMAC. ‘No one is pleased with current market conditions,’ he said. ‘However, Cerberus is a patient investor and not a market timer, and we take a long-term view of our investments. Our funds are structured accordingly.'”
Long-term view indeed.
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