Quantcast

Ally Comes Clean: ResCap/GMAC May Go Bust

APR 30, 2012 12:19pm ET
Print
Email
Reprints
Comment
Twitter
LinkedIn
Facebook
Google+

For a year now the government owned Ally Financial has kept mum on the idea of throwing ResCap into bankruptcy protection but the self imposed gag order came off late Friday night, squirreled away in the folds of a new 148-page SEC filing. Of course, anyone familiar with the Ally/ResCap saga knows that Ally CEO Michael Carpenter has never liked the mortgage business and for good reason: the housing crisis has turned ResCap into a money pit. Then again, it’s very possible that ResCap/GMAC has turned the corner. The mortgage firm’s problem isn’t its loan production of the past three years – it’s the legacy business and mortgage buybacks. It can be argued that a “clean bank” version of ResCap might be a great company, but will we ever know? The answer could come in about two weeks. If ResCap doesn’t make good on that missed bond payment it’s BK time. But I have a feeling that it will. I mean, why not? It has the cash flow. As for Tom Marano

Comments (0)

Be the first to comment on this post using the section below.

Add Your Comments:
Not Registered?
You must be registered to post a comment. Click here to register.
Already registered? Log in here
Please note you must now log in with your email address and password.
Twitter
Facebook
LinkedIn
Already a subscriber? Log in here
Please note you must now log in with your email address and password.