The Treasury will purchase a $5 billion stake in GMAC and lend $1 billion to GM so the automaker can contribute to the lender’s reorganization as a bank holding company, according to a statement issued yesterday. The loan is in addition to $13.4 billion the Treasury agreed earlier this month to lend to GM and Chrysler LLC.
It's the logical thing to do. GMAC is a financial institution that's oriented toward making loans for people to purchase automobiles. They're a better bet for TARP funds than banks that want to buy other banks.