U.S. sells last GM shares, recoups bailout minus $10.5B

The U.S. government ended up losing $10.5 billion on the General Motors bailout, but it says the alternative would have been far worse.

The Treasury Department sold its final shares of the Detroit auto giant Monday, recovering $39 billion of the $49.5 billion it spent to save the dying automaker at the height of the financial crisis five years ago.

Without the bailout, the country would have lost more than 1 million jobs and the economy could have slipped from recession into a depression, Treasury Secretary Jacob Lew said on a conference call with reporters.

"The economic stakes were high, and President Obama understood that inaction was not an option," Lew said.

The government received 912 million GM shares, or a 60.8 percent stake, under the bailout in 2008 and 2009. It began selling shares once GM went public again in 2010, and the pace picked up this year as the share price rose more than 40 percent.

GM went through bankruptcy protection in 2009 and was cleansed of most of its huge debt, while stockholders lost their investments.

Since leaving bankruptcy, GM has been profitable for 15 straight quarters, racking up almost $20 billion in net income on strong new products and rising sales in North America and China. It also has invested $8.8 billion in U.S. facilities and has added about 3,000 workers, bringing its U.S. employment to 80,000.

The auto bailout was part of the Troubled Asset Relief Program, with the bulk of the money going to financial institutions. Treasury said it spent $421.8 billion on bailouts and so far has recovered $432.7 billion, including the loss on GM.