By Matt Jarzemsky 
 

Ally Financial Inc. cut J.P. Morgan Chase & Co. (JPM) as an underwriter for its planned initial public offering, saying other banks had invested more in their relationship with the government-owned auto lender.

Detroit-based Ally has moved toward an IPO as it seeks to repay the $17.2 billion it received in a government bailout during the financial crisis. The company has also been shedding international assets and working to resolve liabilities related to its former mortgage unit, which scuttled Ally's plans for a public debut in 2011.

Ally disclosed its updated underwriter lineup in a filing posted Tuesday on the U.S. Securities and Exchange Commission's website. Citigroup Inc. (C) and Morgan Stanley (MS) are leading the deal.

The group "is a reflection of the investment that the various banks have made in the Ally relationship over the last year," an Ally spokeswoman said. She declined to elaborate.

A J.P. Morgan Chase & Co. spokeswoman declined to comment.

Write to Matt Jarzemsky at matthew.jarzemsky@dowjones.com

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