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Announcement:

MOODY'S MAINTAINS REVIEW OF GMAC AND RESCAP RATINGS

29 Mar 2006
MOODY'S MAINTAINS REVIEW OF GMAC AND RESCAP RATINGS

New York, March 29, 2006 -- Moody's Investors Service said today that it maintained its review for possible downgrade on General Motors Acceptance Corporation's Ba1 long-term rating and Residential Capital Corporation's (ResCap) Baa3 long-term and Prime-3 short-term ratings. These actions follow the announcement by the two firms and their parent, General Motors, that certain prior period financial statements cannot be relied upon, as disclosed in securities filings made by the firms yesterday. Concurrently, Moody's said it downgraded GM's corporate family rating to B3 with a negative outlook. (See related GM press release.)

Moody's believes that the further weakening at GM, as reflected in today's rating downgrade, puts additional negative pressure on GMAC's stand-alone credit profile. This is due to the substantial direct and indirect exposures GMAC currently has to GM. However, Moody's maintained GMAC's Ba1 long-term rating, on review for possible downgrade, because it believes that a successful conclusion of the GMAC sale process could have positive implications for GMAC's current stand-alone credit profile, corporate governance and control. This could lead to the confirmation of GMAC's ratings at their current level.

In the absence of a sale transaction, Moody's said that it would re-link GMAC's ratings with GM's ratings. This would most likely result in the assignment of a Ba3 long-term rating to GMAC, absent the occurrence of additional deterioration to its credit profile resulting from internal issues or further GM stress. In addition, Moody's would monitor the structural subordination of GMAC's unsecured creditors, and their potential loss given default, given the likely increased reliance upon securitization financing in this scenario.

Moody's also stated that even if the sale of GMAC does not take place it would most likely maintain the current Baa3 and Prime-3 ratings of ResCap. This rating action would reflect Moody's expectation that ResCap would likely be sold on its own if the GMAC sale efforts are abandoned. Moody's review of ResCap's ratings is focusing on any further accounting or control issues, the company's continued efforts to extinguish its intercompany debt with GMAC, and the progress made on GM's sale of GMAC.

GMAC, a wholly-owned subsidiary of GM, provides retail and wholesale financing in support of GM's automotive operations and is one of the world's largest non-bank financial institutions.

ResCap is a holding company for the real estate financing businesses of GMAC, including GMAC-RFC Holding and GMAC Residential Holding Corp.

New York
Robert Young
Managing Director
Financial Institutions Group
Moody's Investors Service
JOURNALISTS: 212-553-0376
SUBSCRIBERS: 212-553-1653

New York
Mark L. Wasden
Vice President - Senior Analyst
Financial Institutions Group
Moody's Investors Service
JOURNALISTS: 212-553-0376
SUBSCRIBERS: 212-553-1653

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