HONOLULU (AP) — GMAC Commercial Finance, which helped force Aloha Airlines to shut down its passenger service when it refused to lend the airline more money, has itself been facing financial pressures.
GMAC Commercial Finance’s sister company, GMAC Residential Capital, lost more than $4 billion last year from defaults tied to subprime loans.
In February, GMAC Commercial Finance’s parent company, GMAC Financial Services, laid off 1,000 people. Shortly after that, the parent company’s debt securities were downgraded by Standard & Poor’s to junk-bond levels.
GMAC Commercial Finance had loaned Aloha more than $44 million.
But it was unwilling to take on more risk after Aloha lost $120 million during a heated, two-year interisland fare war.