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Treasury sells entire Ally stake, ends auto rescue

In this April 10, 2014 file photo, Ally Financial CEO Michael Carpenter, third from right, is applauded as he rings the New York Stock Exchange opening bell to mark his company's IPO.
Richard Drew | AP

The U.S. Treasury Department will sell its remaining 54.9 million shares of Ally Financial acquired under the government's bailout of the auto lender, Ally said on Thursday.

This sale concludes the last major Troubled Asset Relief Program (TARP) investment and ends the government's auto industry recovery program.

The Treasury said the shares were sold at $23.25 per share, which recovered $1.3 billion to taxpayers. The government sold the majority of its stake in Ally when the company went public last April. In total, taxpayers gained $19.6 billion from the Ally investment, $2.4 billion more than the initial $17.2 billion investment made in 2009 during the financial crisis when the lender faced mounting losses from subprime mortgages.

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The total recovery from TARP investments, including the proceeds from Ally shares, amounts to $441.7 billion, a gain from the original $426.4 billion disbursed.

"The Auto Industry Financing Program helped save the auto industry, more than one million jobs, and prevent a second Great Depression," said Treasury Secretary Jacob Lew. "Thanks to President Obama's leadership, our economy has rebounded from the depths of the financial crisis and is now creating jobs at the fastest pace since the 1990s. There is more work to do, but as we exit the last major financial investment, it's important to take stock of the progress we have made, and the critical role TARP and the Auto Industry Financing Program played in getting us to this point. "

US government exits Ally Financial

Separately, Ally said in a regulatory filing that it had received a subpoena from the Department of Justice for information related to its subprime automotive finance lending practices.

Ally also said in the regulatory filing it had agreed to voluntarily extend the statutes of limitation to allow the DOJ to continue its investigation related to representations made by Ally regarding Residential Capital, the company's former mortgage subsidiary, in connection with investments in Ally made by the Treasury Department under the Troubled Asset Relief Program.

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In noting the subpoena received from the Justice Department, Ally said in its regulatory filing that other financial institutions had disclosed receiving similar requests earlier this year.

GM Financial, the in-house financing arm of General Motors, said in October it had received subpoenas from state attorneys general and other authorities over similar issues. Ally was the former financing arm for GM.

—Reuters contributed to this report.