Ally unit ResCap files for bankruptcy
Source: Detroit News Washington Bureau
Washington— Ally Financial Inc.'s troubled mortgage unit Residential Capital LLC filed for Chapter 11 bankruptcy early Monday as the Detroit-based auto lender said it may sell its international businesses.
Ally Financial, a bank holding company that is 74 percent owned by the U.S. Treasury as part of a $17.2 billion bailout, said the company expects to lose $1.3 billion as part of ResCap's bankruptcy restructuring.
ResCap and about 30 other affiliated entities — including GMAC Mortgage LLC and Ditech LLC — filed for bankruptcy in New York and said it has reached agreement with certain of its key creditors, including Ally, on the terms of a prearranged Chapter 11 plan that it hopes will allow ResCap to exit court restructuring by the end of the year.
ResCap — which focused on subprime mortgages and services 2.4 million loans — in its bankruptcy filing listed assets of $15.7 billion and debts of $15.3 billion. It faced default on a $20 million debt payment this week if it hadn't sought court protection - and hundreds of millions in additional payments would have been coming due in the following months.
Read more: http://www.detroitnews.com/article/20120514/AUTO01/205140369/Ally-unit-ResCap-files-bankruptcy?odyssey=tab|topnews|text|FRONTPAGE
Who would have ever thought that this might happen? Ally Bank was GMAC bank.
If I had a bank account at this place, I think I'd be rid of it quickly -- just an opinion for what that may be worth these days ...
