Fitch Assigns 'BBB' & 'F2' Ratings to Residential Capital Corp.

NEW YORK--June 9, 2005--Fitch Ratings has assigned a 'BBB' senior unsecured debt rating and 'F2' commercial paper rating to Residential Capital Corporation (ResCap). In addition, Fitch has upgraded the long-term and short-term ratings of GMAC Bank and removed them from Rating Watch Evolving, where they were placed on May 24, 2005. The Rating Outlook for ResCap and GMAC Bank is Negative. A complete list of ratings is detailed at the end of this release.

ResCap is the newly formed holding company for General Motors Acceptance Corp.'s (GMAC) residential mortgage companies, Residential Funding Corporation and GMAC Mortgage Corporation. ResCap was created to provide additional operational and financial flexibility and to enhance the liquidity of the residential mortgage business. GMAC (rated 'BB+/B' by Fitch) has also contributed $2.0 billion of equity to ResCap in connection with this formation by converting some of its intercompany debt to equity. GMAC retains 100% ownership interest in ResCap. Taking account of the $2.0 billion equity conversion in May 20, 200505, there remains approximately $8.2 billion of intercompany debt outstanding at March 31, 2005, of which, $5.0 billion will be converted to long-term subordinated debt. Fitch expects that a portion of proceeds raised through any ResCap corporate debt issuance may be used to repay intercompany debt to GMAC.

The differential in the ratings between ResCap and GMAC is consistent with Fitch's criteria regarding parent and financial subsidiary relationships. As such, the ratings and Rating Outlook of ResCap are expected to move in tandem with the ratings of GMAC. The two-notch differential reflects the very diverse nature of ResCap's business, which is unrelated to the manufacture and financing of automotive vehicles. Supporting this rating distinction is the fact that ResCap has in place an effective operating agreement, with enforceability rights for creditors, sufficient corporate governance independence in the form of two independent directors, superior and separate sources of liquidity relative to its parent company, ResCap's business diversity relative to GM, and absence of cross-default provisions between ResCap and GMAC. Fitch believes these actions reflect GMAC's intention to maintain ResCap as an investment-grade issuer. Fitch did receive a legal opinion that ResCap should not likely be substantively consolidated in a bankruptcy proceeding of GMAC.

Fitch would view the stand-alone financial profile as solidly investment grade and its rating would be higher than its assigned rating. Fitch's stand-alone view reflects the company's good market position in major segments of U.S. and, increasingly, international, residential mortgage lending, sound risk-adjusted capital levels, and recurring earnings and cash flow. Fitch expects that these fundamental strengths would be maintained regardless of financial issues at GM. In addition, Fitch believes that ResCap has adequate credit and interest-rate risk management capabilities commensurate with its rating. Incorporated in the ratings is the expectation that ResCap obtains a bank line of credit in appropriate size and with commercially reasonable terms and conditions to support its financing plans. Moreover, Fitch expects that ResCap will maintain adequate unencumbered asset coverage relative to unsecured debt, generally exceeding 1.0 times (x).

Fitch notes ResCap's increase in nonperforming assets, mainly in subprime and nonconforming portfolios. Fitch believes that this is primarily the result of portfolio seasoning, as well as other factors. Fitch has evaluated the various securitization trusts, and performance of loan pools continues to be within expectations. Notwithstanding, Fitch will continue to monitor credit quality, particularly to the extent macroeconomic conditions such as interest rates or housing prices change.

In terms of GMAC, Fitch views the ring-fencing of ResCap as neutral to GMAC creditors. While the formation of ResCap reduces GMAC's longer term financial flexibility, ResCap and its predecessors have been users of capital and have not paid a dividend to GMAC since 1997. The ring-fencing should allow for repayment of intercompany debt over time. In addition, GMAC creditors continue to benefit from the equity interest GMAC has in ResCap.

The following ratings are assigned by Fitch:

Residential Capital Corp.

-- Senior unsecured debt 'BBB';

-- Long-term issuer 'BBB';

-- Commercial paper 'F2';

-- Short-term issuer 'F2';

-- Rating Outlook Negative.

The following ratings are upgraded and removed from Rating Watch Evolving:

GMAC Bank

-- Long-term to 'BBB' from 'BBB-';

-- Short-term to 'F2' from 'F3';

-- Rating Outlook Negative.

The following ratings are affirmed by Fitch:

GMAC Bank

-- Individual at 'B/C';

-- Support at '2'.

Fitch's rating definitions are available on the agency's public web site, 'www.fitchratings.com'. Published ratings, criteria and methodologies, and relevant policies and procedures are also available from this site, at all times. This document will remain on the public site for seven days.