Frankfurt  - Volkswagen's banking unit said it was cleared Wednesday to receive 2 billion euros (2.6 billion dollars) in guarantees from Germany's bank bailout fund, Soffin.

The finance unit, which lends to people who buy Volkswagen Group cars, but also operates as an online bank, is the first car company bank to receive backing from the fund. No immediate comment could be obtained from Soffin in Frankfurt.

The German magazine Manager said General Motors' finance associate, GMAC, had applied for similar guarantees amounting to 5 billion euros. A GMAC spokeswoman in Ruesselsheim, Germany declined to confirm the amount but said refinancing options were under review.

GM owns 49 per cent of GMAC. The majority belongs to US private- equity investor Cerberus. In Europe, GMAC lends to buyers of Opel cars. The spokeswoman confirmed GMAC had a German banking licence.

Banks must pay interest for Soffin guarantees, but end up by lowering their total financing costs. Supporting automotive finance units is controversial in Germany, since critics say the bank bailout was intended for core banks, not for manufacturing industry. (dpa)