More than three months after converting to a bank holding company, GMAC LLC is still waiting for the green light from regulators to issue debt crucial to its funding plan.

GMAC, the former financing arm of General Motors Corp., is seeking the go-ahead from the Federal Deposit Insurance Corp. to sell government-guaranteed debt through the agency's Temporary Liquidity Guarantee Program.

This program has allowed financial institutions ranging from Citigroup Inc. to General Electric Co.'s General Electric Capital Corp. to raise money when the credit crisis had otherwise shut them out from repaying or refinancing debt. Qualifying financial companies have so far raised $238.2 billion of government-backed bonds since this program was announced in October, according to the data provider Dealogic.

GMAC has $30.6 billion of debt maturing in 2009, including $11.8 billion of unsecured debt. Gaining access to cheap capital through the TLGP was a major driving force behind the cash-strapped lender's bank registration in December.

"Despite becoming a bank, GMAC is squeezed for capital," said Mark Wasden, an analyst at Moody's Investors Service Inc.

The ability to issue FDIC-backed debt would "represent real liquidity. GMAC needs that today," he said.

The lender could raise up to $12 billion through TLGP, according to an initial estimate by Moody's using FDIC guidelines. "It's a potentially sizable amount," Wasden said. The amount GMAC may issue could differ based on FDIC's decision.

Gina Proia, a GMAC spokeswoman, said it has "an application pending with the FDIC. We are in the process of responding to requests for additional information."

An FDIC spokeswoman said GMAC's application "is currently under review," but she declined to comment on specific details.

GMAC does have access to other forms of federal funding: It got $5 billion under the Treasury Department's Troubled Asset Relief Program.

Its GMAC Bank, as of the end of 2008, had drawn $10 million of a $4 billion credit line from the Federal Reserve. The lender is also exploring ways to tap the government's Term Asset-Backed Securities Loan Facility.

In addition, deposits at GMAC Bank grew by one-third, to $19.2 billion at Dec. 31, compared to a year earlier. The lender also shored up its capital base through a $38 billion debt exchange in November.

But concerns about GMAC's finances persist because of continuing potential losses in its auto finance and mortgage units, its hefty debt burden, restrictions on its lending practices due to its new status as a bank and debt and capital levels the lender must comply with as a bank.

GMAC is jointly owned by General Motors and an investor group led by the private-equity firm Cerberus Capital Management LP.

Lacking adequate capital, it has little choice other than to further whittle down its lending operations. It will have to "shrink its business at a time it's supposed to be diversifying and growing," Wasden said.

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