UPDATE 5-GM to buy stake from Treasury; gov't may lose billions
(Adds comments from senior Treasury official, updates stock action)
* $5.5 bln buyback by GM expected to close by end December
* Treasury has recovered $28.6 bln of its $50 bln bailout for GM
* Allows GM to move away from 'Government Motors' image
* Canada has no current plans to sell its GM stake
* GM shares up 7.1 pct (Adds Treasury official's comments, details on talks between Treasury and GM)
By Ben Klayman
Dec 19 (Reuters) - The U.S. Treasury plans to sell its stake in General Motors Co over the coming year, all but assuring a multibillion-dollar loss in a move that will end the automaker's "Government Motors" era.
Treasury's plan - a two-step process that includes a $5.5 billion stock sale to GM - is part of a broader push to wind down the controversial financial bailout under the Troubled Asset Relief (TARP) program. TARP was created by former president George W. Bush to prevent the collapse of the U.S. banking industry during the 2007-2009 financial crisis. Continued...