GMAC Receives $5 Billion of Bailout Funds

GMAC, meanwhile, said the government's $5 billion investment was completed Monday. The $1 billion loan is still in progress, the Treasury official said.

The Treasury Department said after initially bailing out the auto industry earlier this month that it had committed the first $350 billion of the bank bailout fund, and said Congress should release the second half.

But in several cases the Treasury hasn't actually spent all the committed funds, and the department will use money that hasn't yet been spent to fund the investment in GMAC, the official said. For example, the department allocated $250 billion for a program to inject capital into banks, but has so far spent only about $162 billion of that amount.

General Motors' partial ownership of GMAC has kept the finance arm lending to dealers and car buyers, even as credit from traditional banks has dried up. If GMAC went bankrupt, other institutions would be unlikely to step in to replace the credit lost by GM's dealers and customers.

GM owns 49% of GMAC, while the rest is owned by private equity firm Cerberus Capital Management.

As part of its order last week approving GMAC's application for bank holding company status, the Federal Reserve said GM will reduce its stake to less than 10% of the voting and total equity interest of GMAC. Cerberus, which led an investment group that bought a 51% stake in GMAC from the automaker for $14 billion in 2006, will reduce its stake in GMAC to no more than 33% of total equity.