The restructuring of Ally Financial’s bankrupt ResCap
mortgage unit may be much more expensive than the Treasury Department thought —
and according to the NY Post that could ultimately cost taxpayers.
A group of hedge funds are preparing to push Ally, which is
owned by US Treasury, to quadruple its contribution to the ResCap
reorganization from the $750 million now on the table to $3 billion, several
sources said.
“Ally can afford to pay $3 billion to $4 billion without
impacting regulatory capital,” and satisfy all claims, according to a source
close to the situation.
While that may or may not be true, every additional dollar
contributed by Ally to the ResCap reorganization is a dollar less in value
taxpayer-owned Ally has to pay back Treasury….
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