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US Treasury starts second trading plan for Ally Financial shares

The United States Treasury Department has commenced a second trading plan as part of its efforts to reduce its holdings in Ally Financial Inc. The Treasury used to hold a 16-percent stake in Ally in August, but the completion of the first trading plan has allowed it to trim the holdings to 13.8 percent, or 66.2 million shares of the company’s common stock.

Charmian Uy, Chief Investment Officer, remarked that the further sale of the common stock continues efforts to cut the investment in Ally and the Troubled Asset Relief Program (TARP). He remarked that the second trading plan will allow the Treasury to exit from Ally in a way that “balances speed of exit with maximizing the taxpayer’s return.”

In the first trading plan, the Treasury sold around 8.9 million shares, thereby recovering about $218.7 million for taxpayers. The Treasury has so far recovered about $18 billion on the Ally investment for taxpayers, which is around $873 million more than its original bailout investment at around $17.2 billion.

Read the entire article US Treasury starts second trading plan for Ally Financial shares

US Treasury to cut stake in Ally Financial via share sale

The United States Treasury Department will reduce its stake in Ally Financial Inc. by selling shares on the open market, the department said in a statement. The Treasury Department currently owns 75.1 million shares in Ally, good for a 16-percent stake.

The US owned up to 74 percent of Ally after bailing out the company via the Troubled Asset Relief Program crafted to help shore up the auto market during the financial crisis. However, US Treasury reduced its ownership of Ally after holding an IPO that sold the shares at $25.

Charmian Uy, chief investment officer of the Treasury Department, said in the statement that the US will “prudently exit” the remaining Ally investment, “balancing speed with maximizing returns for taxpayers.”

Read the entire article US Treasury to cut stake in Ally Financial via share sale

US Treasury will sell $3 billion of Ally Financial shares

The United States Treasury Department is planning to sell $3 billion of Ally Financial Inc. common stock, which would result to the reduction of the government’s stake in the company to 37 percent. In a statement, the Treasury said the US plans to sell 410,000 shares for $7,375 each in a private offering. After the sale, the US government would only have around 572,000 shares at the auto lender.

The statement said, that the YS government will cooperate with Ally to explore ways to further reduce its stake, including a public offering or an additional private sale of common shares.

“The strong investor interest is a testament to the significant transformation of the company,” Ally chief executive Michael A. Carpenter said in a separate statement. Ally won an approval from the Federal Reserve to become a bank holding company in December 2008, allowing it to tap a US bailout that amounted to $17.2 billion. As of November 20, 2013, the government owns 64 percent of Ally.

Read the entire article US Treasury will sell $3 billion of Ally Financial shares

US Treasury has sold all stake in General Motors

The United States Treasury Department has sold its remaining stake in General Motors stock, effectively ending over four years of government ownership. In a statement, the government said that it managed to recover $39 billion of its original $49.5 billion investment into GM, resulting to a loss of $10.5 billion to US taxpayers. GM executives and dealers say that sales have suffered from the stigma of federal ownership, which led the carmaker to being called “Government Motors.”

“We will always be grateful for the second chance extended to us and we are doing our best to make the most of it,” GM chief executive Dan Akerson said in a statement. He remarked that continued investments, innovation, and job creation are just some of the “returns” of a healthy GM and domestic auto industry.

GM North America President Mark Reuss quipped that the federal government’s exit could give the carmaker a short-term sales boost and help its image in the longer term. “I think probably some people will begin to consider us right away, maybe the next day.” he said. He acknowledged that truck buyers “probably” have been most turned off by the government ownership of GM.

Read the entire article US Treasury has sold all stake in General Motors

The United States Treasury Department expects to sell its remaining shares at General Motors Co. by the end of the year. According to the Treasury, the final GM share sale would occur by year-end, subject to market conditions and if average daily trading volumes continue at recent levels. Treasury said it already had sold 70.2 million shares of GM stock and to date had recovered $38.4 billion from the $49.5 billion used to bail out the carmaker years ago.

At current prices, Treasury could recover another $1.2 billion from its remaining stake at GM, pegged at 31.1 million shares. That would bring the total recouped amount to $39.6 billion, which is around $10 billion short of the bailout amount. Treasury remarked that its initial cost basis for the GM shares was $43.52 per share.

The carmaker announced in December 2012 that it would sell all its stake in GM in at least a year to 15 months – which means that completing the GM stake sale by the end of 2013 is on the earliest end of its target. Despite the shortfall, the Treasury reiterated that their goal in providing the bailout money was never to make a profit, but to save the US auto industry.

Read the entire article US Treasury to sell remaining GM stakes by end of 2013

The United States Treasury Department is expecting to post a loss of $9.7 billion for selling its stake in General Motors that it received in 2009 as part of the carmaker’s bailout. The government, through the Troubled Asset Relief Program, has provided $49.5 billion in loans to GM, but has yet to recover $14 billion, according to a quarterly report published by the special inspector general for the program.

The figure includes the GM shares already sold as well as the dividend and interest payments. The Treasury once held 912 million shares in GM, for a 60.8-percent stake. The department has already sold 811 million of them as of Sept. 26, and the US government now only owns 7.3 percent of GM, equivalent to around $3.6 billion based on the carmaker’s current stock price.

According to the report, GM’s stock price would have to quadruple to more than $140 for taxpayers to break even on the remaining shares.

Read the entire article US Treasury anticipates $9.7 billion loss in selling stake in GM

The United States Department of the Treasury disclosed that it sold another $570.1 million of General Motors common stock in September as part of its move to totally exit as a shareholder of the carmaker by March 2014.

According to documents the Treasury filed online, it had recovered around $36 billion from its $49.5 billion bailout of the carmaker, as of the end of September.

The Treasury launched on Sept. 26, the third phase of a plan to sell its stake in GM. The Treasury -- which in December 2012 said that it planned to sell all its shares in GM in 12 to 15 months -- did not disclose the number of shares it sold in September, but remarked that its holdings at the carmaker was around 7 percent.

Read the entire article US Treasury sold $570.1 million of GM shares in September

The U.S. Department of the Treasury has disposed another portion of its holdings in General Motors Co. to trim its stake to 7.3%. The Treasury sold over 110 million shares between May 6 and Sept. 13, 2013 and has raised over $3.82 billion, according to documents posted online. The move is part of the Treasury’s exit plan announced in December 2012, when it said it would sell its entire stake in GM in 12 to 15 months.

The Treasury originally had a 60.8% stake in GM, which is now reduced to 101 million shares. Once the government has completed selling all its GM shares, it would have recovered about $35.4 billion of its investment in GM.

Treasury Assistant Secretary Timothy Massad said in a statement that the department is on track to complete its exit from GM by early next year “at a cost far less than originally projected.

Read the entire article US Treasury has sold another block of GM shares

The United States Department of Treasury is slowly but surely divesting its stake in General Motors, staying on course to fulfill a December 2012 pledge that it would sell its holding in the carmaker within 12-15 months. According to the department's monthly report to Congress, the Treasury received total net proceeds of about $877 million from sales of GM common stock in July 2013.

GM’s bankruptcy reorganization in 2009 was ultimately financed by the US and Canadian governments. Canada has also commenced the process of divesting its holdings in GM. The carmaker’s stock traded between $34 and $37 a share in July, which may mean that the US government sold around 24 million to 26 million shares of stock based on the market price.

The carmaker’s shares closed down 13 cents to $35.85 in Tuesday trading. GM has repurchased 200 million shares of its stock from the US Treasury since the Treasury announced the plan its remaining 300 million shares in December. In the first stock sale in April, the Treasury sold 58 million shares of GM common stock, earning around $2 billion in net proceeds.

Read the entire article US Treasury divested more GM stock for $877 million

The United States Treasury Department will divest 30 million additional shares of General Motors Co. common stock in a stock offering. The share sale will also include 20 million shares from the UAW union's GM retiree health-care trust. GM’s share sale coincides with its return to the Standard & Poor's 500 Index on June 6, 2013, the Treasury said in a statement.

The department’s share offering plan is in line with an announcement made in December 2012 that it would sell its remaining GM stake in 12 to 15 months. The Treasury still holds around 241.7 million shares, or nearly 18 percent, of common GM shares, Reuters said. According to a statement by S&P Dow Jones Indices LLC, GM is replacing H.J. Heinz Co., which will be acquired by Berkshire Hathaway Inc. and other investors in a $23 billion buyout.

GM had been in the S&P 500 since the index was formed in 1957, until it was kicked out in 2009 due to its financial collapse that year. GM Chief Financial Officer Dan Ammann said in a statement that they appreciate the opportunity to assist in the share offering that was made possible by the carmaker’s return to the S&P 500.

Read the entire article US Treasury is planning to sell 30 million GM shares

The United States Treasury Department will commence another round of sales of its remaining shares in General Motors Co. The Treasury’s move follows a registration statement by GM in April that made it easier for the department to sell its remaining 241.7 million shares of common stock in the carmaker. A sale would also release GM from being partly owned by the US treasury, thereby liberating it from the tag “Government Motors.”

GM underwent a government-backed bailout bankruptcy in 2009, giving the government a 60.8 percent stake in the carmaker. The government’s stake in GM dwindled to 32 percent after the carmaker held an initial public offering in November 2010.

Tim Massad, Treasury assistant secretary for financial stability, said in a statement, that they are pleased with the progress to date and will continue exiting from GM as planned and in a manner that “maximizes returns for taxpayers."

Read the entire article US Treasury to start new round of sales for its remaining GM stake

The U.S. Treasury had raised $489.9 million in proceeds from the sale of General Motors’ common shares in February. The U.S. is in the process of exiting its ownership stake in GM. These trading results were revealed by the government last Monday in its monthly report to Congress with regards to the Troubled Asset Relief Program’s status.

For the month of January, the Treasury got $156.4 million from the sales of GM shares. The report said that as soon as every pre-arranged trading plan is completed, the number of GM shares sold and average price per share will be announced. GM got the biggest share of the industry bailout initiated by President Barack Obama with an investment of $50 million. Many Republic officials had criticized the investment, which led to GM being tagged as “Government Motors.”

CEO Dan Akerson hopes to someday shed off this image. Matthew Stover, an analyst with Guggenheim Securities LLC in Boston, which has rated the shares as neutral, said that GM’s story is “moving.” Stover said that GM has to continue to expand and move past the crisis period. He said that what’s apparent from the information coming out is that the government is leaving the business.

Read the entire article US Treasury received $489.9 million in proceeds from the sale of shares in GM

The United States Treasury Department "failed to rein in excessive pay" at three bailed-out companies -- General Motors, Ally Financial Inc., and American International Group Inc., -- according to Christy Romero, Special Inspector General for the Troubled Asset Relief Program. In a report, SIGTARP noted that 16 of the 69 executives at the bailed-out companies had 2012 pay packages valued at least $5 million, adding that 68 of them had overall compensation of $1 million or more.

However, since most of the composition is via stock, just three executives had cash salaries of over $1 million, SIGTARP said. The watchdog remarked in its report that although it had issued warnings that the Treasury "lacked robust criteria, policies and procedures" to curb excessive pay, the department "made no meaningful reform to its processes."

SIGTARP noted that decisions of the US Treasury were "largely driven by the pay proposals" made by GM, Ally and AIG. SIGTARP discovered in 2012 that the Treasury again failed to restrain excessive pay. Patricia Geoghegan, the Treasury's acting special master for TARP executive compensation, however disagreed with the findings of SIGTARP.

Read the entire article US Treasury failed to limit excessive pay at bailed-out companies

The Obama administration received a tremendous boost from the plan of the U.S. Treasury to sell the stake it has left in General Motors Co. This brings the government closer to its aim to put an end to a $418 billion bailout program that has become a major issue during the presidential campaign.

With this decision to leave GM in the next 15 months and the sale of the Treasury’s remaining shares of insurer American International Group Inc. last week, two corporate symbols of the 2008 economic crisis from the government's Troubled Asset Relief Program will be wiped out.

For AIG, taxpayers gave up $182.3 billion while $49.5 billion was spent for the rescue of GM. Stephen Myrow, who worked on the program in 2008 as a Treasury official in the administration of George W. Bush and is currently the managing director at ACG Analytics Inc., an investment research and consulting firm in Washington, said that this proves that as the Obama administration embarks on its second term, it aims to cut its link to TARP “as quickly as practicable."

Read the entire article Obama administration closer to end bailout program as U.S. Treasury will sell its 32% stake in GM

General Motors revealed plans to purchase 200 million GM shares from the U.S. Treasury for $5.5 billion, taking a major step to letting go of its image as the notorious “Government Motors.” GM’s sale is expected to close by December 31. The government will then own only around 300 million shares, to achieve a fully diluted stake of 19%.

Separately, the Treasury said that the federal government aims to let go of its total stake in GM in 12 to 15 months. GM is expected to pay $27.50 a share, which is 8% higher than $25.49, its closing price on Tuesday. According to GM CFO Dan Ammann, talks were held between GM and Treasury officials to establish the price. In a press briefing, Ammann described the sale as “very attractive” for the company and its shareholders.

He also said that the business will benefit since it erases the perception of the government being involved in the company. He added that over time, the sale will benefit sales and its customer base. A senior Treasury official told Reuters that GM made the first move to talk to Treasury officials after November’s U.S. presidential election.

Read the entire article GM reveals plans to buy its U.S. treasury shares for $5.5 billion

Insiders said that the U.S. Treasury believes that the stock price of General Motors Co. will go up in the future, giving the government a better chance to reduce its losses in the automaker. The U.S. taxpayers provided the $50 billion bailout of GM in 2009. These people said that the government hasn’t yet come to a specific price threshold at which it would attempt to exit its remaining 500 million GM shares but the Treasury is closely monitoring the value of its stake.

Analysts think that one major factor that may boost GM shares in early 2013 is the planned release of very profitable large trucks. The Treasury thinks that with an expected increase in share price, the Treasury does not believe that it is wise to unload a large volume of shares prematurely at the present levels.

Since there are 500 million shares, a $1 increase in the share price could trim $500 million from the expected loss. GM had also thought that the U.S. automaker will buy back a portion of the Treasury's stake straight from the government. However, the government threw out this idea last year. Sources said that there are no recent high-level conversations with GM about the issue.

Read the entire article US Treasury wants to see a higher stock price before selling its shares in GM

How General Motors Co. handles challenges in the next few months will determine if the U.S. Treasury will start to cut its stake in the company in September or later.

The factors that have pulled down GM's shares by about 10% below their initial public offering price of $33 include weak stock markets, worries about a debt crisis in Europe and the U.S., and the increasing inventory of unsold trucks. Due to these variables, it’s very difficult to estimate when the government will make its exit.

Sources say that Treasury has no intentions of selling GM shares before Labor Day this September. There’s no indication that global economic concerns will be resolved soon.

Read the entire article U.S. Treasury will begin cutting stake in GM after seeing how the firm will handle challenges

The U.S. Treasury plans to sell its remaining stake in General Motors Co. shares "as soon as practicable," according to prepared remarks revealed on the Web site of the Committee on Oversight and Government Reform.

Former auto czar Ron Bloom is expected to testify in a committee hearing dubbed the "Lasting Implications of the General Motors Bailout" that the government has “a clear path” to exit its investment in GM. Bloom now serves as the White House manufacturing adviser.

The Committee on Oversight and Government Reform has broad oversight on policies in government. In 2010, GM went public, enabling the U.S. government to almost halve its 61% stake in GM. Presently, the U.S. government holds 32% of GM's common equity.

Read the entire article U.S. Treasury planning to sell its remaining stake in General Motors

Saying that the price is too low, the U.S. Treasury Department is hesitating to sell a portion of its 33% stake in General Motors Co. to the carmaker, according to an insider who declined to be named as the talks are private. This source said that GM executives have talked about purchasing some of the Treasury's shares or permitting all holders of common stock to sell back shares.

The source added that the Treasury isn’t keen on selling to GM since the shares are currently trading at 13% lower than the $33 price of the initial public offering price.

The U.S. government is not interested in the idea of selling shares to GM now since it may invite criticisms that the company is getting a preferential deal. In the IPO last November, the Treasury Department sold 28% of GM at $33. Those familiar with the issue said that the government is hoping to get at least the same price in a stock sale.

Read the entire article U.S. Treasury hesitates to sell its stake in GM due to low price of the shares

In order to prevent the loss of talented people from General Motors Co., CEO Dan Akerson is asking for "some relaxation" in the limitations on executive pay enforced by the U.S. government. At the Economic Club of Washington, D.C., Akerson said that GM has to be competitive and keep the talent that it has. He revealed that GM is “starting to lose them now."

Akerson said that he is set to meet with the U.S. Treasury's special paymaster to talk about the matter of executive compensation.

According to a Detroit News report, GM salaried employees will not get salary raises in 2011. The newspaper said that GM's salary freeze is being maintained to "lead by example," as GM works to rebuild its balance sheet after its restructuring.

Read the entire article GM CEO Dan Akerson asks US Treasury to ease pay restrictions of execs