Ally and subsidiary Residential Capital have improved their capital, credit quality, and liquidity in recent months. The companies also settled a material portion of potential mortgage repurchase obligations and have been profitable. We are raising our counterparty credit ratings on Ally and Residential Capital to 'B+' from 'B'. Ally and Residential Capital continue to face significant legal, regulatory, and funding risk, and their consolidated core earnings capacity remains weaker than peers. On May 4, 2011, Standard&Poor's Ratings Services raised its long-term counterparty credit ratings on both Ally Financial Inc. (formerly GMAC Inc.) and subsidiary Residential Capital LLC (ResCap) to 'B+' from 'B'. The outlook on both ratings is stable. We also raised our rating on Ally's preferred securities
