S&P Cuts GMAC, ResCap Ratings

Standard & Poor's cut the credit ratings of GMAC LLC and its Residential Capital unit further into junk territory, as the firms face continued challenges in the current credit climate.

S&P added further downgrades are possible.

Analyst John Bartko said ResCap's voyage toward profitability must overcome "a still-difficult funding environment, and our perception of the reduced potential for parental support" from General Motors Corp., which owns 49% of GMAC, and 51% owner Cerberus Capital Management LP. Further losses are seen in 2008, on top of the $4.3 billion recorded last year by the mortgage business.

Read Full Article from Wall Street Journal

- Posted: 2008-02-22 09:40:47

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