Ally Financial Inc. is taking new steps to repay the U.S. government for its financial crisis-era bailout and free itself from federal control, The Wall Street Journal reported yesterday. The Detroit-based auto-loan maker said that it has reached agreements to sell about $1 billion of common stock to investors. The sales would boost Ally's capital levels enough to allow it to buy back $5.9 billion in preferred shares owned by the U.S. Treasury if regulators approve the transaction. All told, the U.S. government pumped $17.2 billion into Ally during the financial crisis through the Troubled Asset Relief Program. To date, Ally has repaid about $6.2 billion. Ally, which began as General Motors Co.'s financing arm, will remain under federal control even after the sales. Assuming the transactions go according to plan, the government's stake in Ally would be reduced to about 65 percent from 74 percent.
