Daunting Numbers for GMAC

As we know, GMAC LLC is among the 19 largest banks in the nation that needs to raise new capital to meet the demands outlined after the Federal Reserve concluded its stress tests of the banks.

But the murmuring now suggest that GMAC will be forced to tap the Capital Assistance Program to raise its funds, and that will make GMAC effectively a servant of the federal government — if it hasn’t become one already.

BreakingViews spells out the daunting numbers GMAC faces. GMAC got $5 billion of TARP funds and has another $1.2 billion of non-equity Tier 1 capital “that it could try to swap into common stock.” Even if both of those pools of capital are converted into common, GMAC would be $5.3 billion short of the government’s mandate.

By BreakingViews’s estimate, GMAC is worth perhaps $6.8 billion today, but most likely would be valued at $4 billion. That means GMAC will have a tough time finding investors to give it $5.3 billion, leaving it only one option: federal assistance. Put another way, GMAC will get Fannie Mae-ed.