NEW YORK - GMAC, the General Motors Corp financing affiliate that received a US$6 billion infusion from the government, completed a multibillion dollar debt swap on Wednesday designed to bolster its capital.

The lender said holders of US$21.2 billion of debt will swap their stakes for US$15.7 billion of new securities plus cash. The exchange will ease GMAC's debt burden, though the lender fell short of its goal of 75 per cent participation in the roughly US$38 billion swap, instead getting about 56 per cent.

GMAC's offer required investors to accept less than face value for their holdings. It was designed to enable Detroit-based GMAC to become a bank holding company, allowing it to tap low-cost funding and helping to assure its survival.

Pressure to complete the offer eased after the Federal Reserve awarded bank holding company status to GMAC on Dec 24, and the Treasury Department announced the US$6 billion infusion five days later. Part of that money comes from the US Treasury's US$700 billion Troubled Asset Relief Programme.

On Tuesday, GMAC said it would use the infusion to make loans to a wider range of borrowers. It also made some payments to GM for vehicle financing that it had previously deferred, GM said in a US Securities and Exchange Commission filing.

GMAC is the main lender to GM customers, and restoring its health is key to helping the nation's largest automaker stay afloat.

Private equity firm Cerberus Capital Management LP is GMAC's other major owner.

GMAC accepted tenders from holders of US$17.5 billion, or 59 per cent, of old GMAC notes, and US$3.7 billion, or 39 per cent, of notes from its Residential Capital LLC mortgage unit.

It said the GMAC investors will receive US$11.9 billion of senior guaranteed notes and $2.6 billion of preferred stock that never matures, while the ResCap investors will receive US$1.17 billion of new GMAC notes.

GMAC is trying to recover after US$7.9 billion in losses in the 15 months ended Sept 30. Most of the losses came from ResCap, but credit problems on auto loans were also worsening.

On Tuesday, GMAC said it would begin making loans to people with credit scores of 621 or higher, significantly easing a requirement for a 700 score that it had imposed in October.

The median US credit score is 723, according to Fair Isaac Corp's myFICO unit.

In Wednesday morning trading, GMAC's 6.875 per cent notes maturing in 2012 rose 2 cents on the dollar to 76 cents, yielding about 16 per cent, according to MarketAxess.

GM shares fell 7 cents to US$3.73 on the New York Stock Exchange. -- THOMSON REUTERS