Ally Financial, formerly GMAC and the financial wing of General Motors, dumped slightly more than $2.5 billion of its debt as Moody's Investors Service upped the company's credit rating from B3 to B1, the Detroit News reports. That was a significant step for an auto lender aiming to recapture its industry footing following a publicized split from its former parent company during the auto bailouts.

According to the news source, Ally sold $1 billion of three-year, fixed-rate notes and $1.25 billion of floating-rate debt, Bloomberg details. The sales, says Gimme Credit bonds analyst Kathleen Shanley, were a big step forward for a company trying to compete with large investment banks.

"Ally bonds have already priced in the recent credit improvements," Shanley told her clients, according to the Detroit News. "It still has work ahead before it can close the gap with investment grade banks."

The lender recently made financial headlines when it reported $79 million in earnings during the fourth quarter of 2010, which was a far cry from the nearly $5 billion it lost during Q4 2009. For all of 2010, the company brought in $1.1 billion, following a $10.3 billion decline in 2009.