U.S. Boosts Ally Stake to Prepare Lender for IPO

Ally Financial Inc., the auto and home lender bailed out by the U.S., moved closer to regaining its independence as the government converted $5.5 billion of preferred stock into common shares.

The swap involves almost half the Treasury Department’s preferred stock and boosts the U.S. taxpayers’ stake to 74 percent of Ally’s common shares from 56.3 percent, according to a department statement today. The move, along with a planned sale of some trust preferred securities held by the U.S., is “designed to accelerate Treasury’s ability to exit its investment,” the statement said.