GMAC gets new name: Ally Financial

May 7, 2010

GMAC gets new name: Ally Financial

Detroit News Washington Bureau

Washington — It’s official. Detroit-based GMAC Inc. becomes Ally Financial Inc. on Monday.

The auto and mortgage finance company — which was founded by General Motors in 1919 — gets a new name starting Monday.

The company filed its name change with the Securities and Exchange Commission today and said 75 percent of its shareholders had approved it. That means the U.S. Treasury signed off on the change, since the government owns 56.3 percent of the company.

The Treasury has infused $17.2 billion in capital into GMAC since 2008.

Cerberus Capital Management LP acquired a 51 percent stake in GMAC from GM in 2006 for $7.4 billion.

This week GMAC reported net income of $162 million in the first three months of the year — its first profitable quarter since 2008.

"We need to move on from that name," said GMAC CEO Michael Carpenter on Monday, noting that the company must legally stop using the GMAC name by 2016.

Ally Bank has $32 billion in deposits and was awarded "Best Savings Account: by Money Magazine.

GMAC also reported its fifth consecutive profitable quarter in its core automotive business. It has focused on selling or restructuring its troubled ResCap mortgage lending business. The company has hired two outside advisers to explore strategic alternatives.

GMAC said its auto business was improving, and it had boosted its share of General Motors Co. and Chrysler Group LLC lending.

GMAC financed 34 percent of GM sales in the first quarter, up from 30 percent the prior three months, and 42 percent of Chrysler sales, up from 26 percent.

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