Home / Markets / Economy

Friday, January 16, 2009

Treasury to Loan $1.5 Billion to Chrysler Financial

By Kathryn Elizabeth Tuggle

FOXBusiness

The U.S. Treasury Department announced plans on Friday to make a $1.5 billion loan to Chrysler Financial, the auto financing arm of Chrysler LLC.

The loan will go towards funding loans for consumers purchasing vehicles, and will be in addition to loans made to Chrysler and General Motors in December.

For the latest TARP news, check out FOXBusiness.com’s Where’s My Money blog.

The Chrysler Financial loan package is similar to the package given to GMAC, the financing division of General Motors (GM) that is 51%-owned by Cerberus Capital Management and 49%-owned by GM.

The five-year loan stands to pay interest at a rate of one month LIBOR plus one percentage point in the first year, and in years two through five, interest will be paid at a rate of one-month LIBOR plus 1.5 percentage points. Libor, the London Interbank Offered Rate, is a measure of what rates banks charge each other when they do intrabank lending.

Fox Business Video

- The Crisis With 20/20 Hindsight
- Nov 21, 2009
  
  FOXBusiness.com LIVE
- Jerry Rice Talks Career
- Nov 21, 2009
  
  NFL Receiver on career on the gridiron
- John O'Hurley as Venture Capitalist
- Nov 21, 2009
  
  Comedian on life as venture capitalist
- Excess Spending in Congress
- Nov 21, 2009
  
  Saving $100 Million
- Cavuto Business Report 11-20-09
- Nov 21, 2009
  
  Business Report: Cavuto