NEW YORK (CNNMoney.com) -- General Motors will pay off a $6.7 billion federal loan by June, well ahead of the deadline for the repayment under terms of the bailout, company CEO Ed Whitacre said Tuesday.
Whitacre had said a week ago that GM was looking at making an early payment. The company announced in November that it would make a first payment of $1 billion to the Treasury in December but it could have taken two years to repay the rest of the money.
But a statement from GM said it now plans to pay back the loan in full "assuming no adverse economic or business conditions."
The company has the loan money sitting in a $17.4 billion escrow account. It has an additional $25 billion in unrestricted cash on its balance sheet as of Sept. 30, according to its most recent financial report.
Despite a $1.2 billion loss in its first quarter since emerging from bankruptcy, company officials have said the company is ahead of plans to return to profitability.
But the loan money is only a fraction of the cash that the federal government gave to GM over the last 12 months in order to stop it from going out of business. Overall, GM received $50 billion in federal help, with the government receiving $2 billion in preferred stock and 61% of the company's privately held common shares in return for the rest of the money.
The company is just the latest company to receive cash from the Troubled Asset Relief Program (TARP) to announce an early repayment to the U.S. Treasury. Banks Citigroup, Bank of America, Wells Fargo have announced plans to repay their loans this month as well.
But the loan repayment by the banks removed federal pay restrictions on its top executives. GM officials say they still don't know if the pay limits will still apply to its executives due to the government's continued ownership stake in the automaker.
GM is seeking a new CEO. Whitacre, who had joined the company as a non-executive chairman of the board in July, assumed the CEO post on an interim basis when Fritz Henderson resigned under pressure from the board on Dec. 1.