S&P cuts ResCap, GMAC

Standard & Poor's said it lowered Residential Capital LLC's ratings to CCC+ from B following the announcement that two independent board members resigned, and placed ratings on CreditWatch with negative implications.

The agency lowered ratings on GMAC LLC, parent company of ResCap, to B from B+.

The outlook remains negative.

ResCap's downgrade reflects corporate governance concerns, the agency said.

The company has not said why the board members resigned, according to S&P. And the directors' leaving sharpens concerns about company performance, hit by turmoil in housing and mortgage markets, the agency noted.

The downgrade on GMAC reflects concerns about ResCap's stressed condition, the likelihood that it would require additional support and concern that GMAC will bear the brunt of it, the agency said.

Pressured performance at GMAC's core auto finance business is also a factor, S&P noted, given broad capital market challenges and lower 2008 car sales.

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