A government watchdog is pressing the Treasury Department to develop a plan for Ally Financial to repay taxpayers, who own 74 percent of the company. (Robert Miller/The Washington Post)

In the four years since the federal government pumped billions into the nation’s financial firms to stave off economic collapse, virtually all of the biggest companies have repaid their debts. But Ally Financial, once one of the largest auto lenders in the country, still owes the government $11.4 billion.

Now a government watchdog is pressing the Treasury Department to develop a plan for Ally to repay taxpayers, who own 74 percent of the company. In a report to Congress being issued Wednesday, the special inspector general for the Troubled Assets Relief Program criticizes Treasury for being slow to get Ally into line.

Ally, formerly known as GMAC, received three rounds of federal aid totaling $17.2 billion and has repaid $5.8 billion.

“Ally is highly confident in its ability to repay the remaining U.S. Treasury investment in full,” company spokeswoman Gina Proia said. “We have taken a number of steps in 2012 designed to best position the company to exit TARP, and there has been significant progress thus far.”

At the height of the financial crisis, the company provided about three-quarters of the financing for auto dealers to purchase vehicles from General Motors and Chrysler.

Troubles came to a head in 2008 as lower car sales and write-downs on auto leases resulted in a loss of $2.1 billion. Ally then was brought to its knees by its subprime mortgage business, which sustained even more dramatic losses.

The company planned to launch an initial public offering to repay the government, but it postponed the offering in 2011 as its mortgage subsidiary ResCap contended with mounting losses.

“Treasury placed no requirements on GMAC to plan to resolve its subprime mortgage liabilities and losses, which have become a millstone around taxpayers’ necks,” said Christy Romero, special inspector general for TARP.

The George W. Bush administration floated the first round of aid to Ally in December 2008 through the auto program that propped up GM and Chrysler. Chrysler settled its tab in 2011 — although Treasury lost $1.9 billion on the investment. The federal government, meanwhile, is in the process of selling off its remaining shares of GM.

Treasury required GM and Chrysler to submit a viability plan for resolving their liabilities, but it never pressed Ally to do the same, according to the report. Romero said the lack of a plan for addressing the subprime mortgage loans may be the reason why Ally has been unable to repay the government.

Treasury’s point man for TARP, Timothy G. Massad, rejected Romero’s assumption about why Ally has struggled to exit the program. In a letter responding to the report, he said that the company was sidelined by the bankruptcy of ResCap in May. The Chapter 11 proceedings, however, provide a structured way to address the legacy loans without damaging the profitable auto financing and banking operations, he said.

Massad said that he expects that once the liabilities are addressed, the agency will be able to recoup the reminder of the investment through a sale of its shares or sale of assets depending on market conditions.