GMAC plans to slash $1 billion in costs - reports

CHICAGO, May 23 - Auto and mortgage lender GMAC LLC plans to slash $1 billion in costs this year, or about 20 percent of its expenses, according to media reports on Saturday that cited an internal memo circulated this week.

The Wall Street Journal said restructuring efforts will be lead by turnaround specialist Christopher Marshall, brought in this week as an adviser to GMAC chief executive Al de Molina.

Marshall was most recently an adviser with private equity firm Blackstone Group.

Detroit-based GMAC has suffered losses over the past two years from mortgage defaults and plummeting auto sales.

It has received $12.5 billion in government infusions since December, including $7.5 billion on Thursday, which is aimed at counteracting a scarcity of credit to potential car buyers and bolstering GMAC's capital position.

GMAC is the preferred lender to buyers of GM and Chrysler autos. GM and private equity firm Cerberus Capital Management LP have stakes in the lender.

GMAC is giving a 35.4 percent equity stake to the U.S. Treasury Department, and said on Friday that it might take 17 years for the government to shed its investment if the company were to go public.