Proposed transaction is in line with objective to redeploy capital for higher returns
Tokyo (BUSINESS WIRE) - GE Money, the consumer financial services unit of the General Electric Company (NYSE: GE), announced today it has signed an agreement to sell its Japanese consumer finance business, which includes the Lake personal loan business, wholly owned credit cards and mortgages under GE Consumer Finance Co Ltd and its subsidiaries, to Shinsei Bank, a leading diversified Japanese bank. The transaction, which is subject to closing conditions, including regulatory approvals, is valued at Y580 billion (US$5.4 billion) and is expected to close in the third quarter of 2008.
Under the terms of the agreement, in addition to acquiring GE Money's loan, credit card, and mortgage businesses, Shinsei Bank plans to retain and work closely with GE employees in these businesses as part of its strategy to expand its position in the Japanese consumer credit marketplace.
Commenting on the transaction, William H. Cary, President and CEO of GE Money, said, "In an extremely challenging environment, we have completed an agreement that fully meets our core strategic objectives: giving our Japanese business the opportunity to work with a partner committed to investing in Japan, and allowing GE Money and GE to redeploy its capital to areas which will generate strong sustainable long-term growth and returns for our shareowners.
Yoshiaki Fujimori, President and CEO of GE Money Asia, said, "With its scale and expertise, Shinsei Bank is best positioned to leverage these businesses for continued growth and success in the long term. I would like to thank our employees in Japan for all of their tremendous efforts and hard work in building such a resilient and successful business."
As part of the transaction, GE and Shinsei Bank agreed to a risk-sharing arrangement relating to potential Gray Zone liabilities. GE does not expect potential losses to be materially higher than existing reserves.
GE Money will continue to operate GE Nissen Credit Co. Ltd, its credit card joint venture with Nissen, a leading shopping catalogue in Japan.
GE Money and Nissen will continue to hold a 50% stake each in the company and pursue further growth opportunities.
GE's Commercial Finance business has a strong presence in Japan, including leasing, fleet services, healthcare finance, and commercial real estate. In addition, GE continues to grow and invest in its Japanese businesses, including aircraft engines, energy, healthcare, and technology and media.
ABOUT GE MONEY With more than $200 billion in assets, GE Money, a unit of General Electric Company (NYSE: GE) is a leading provider of retail banking and credit services to consumers, retailers, and auto dealers in 55 countries around the world. With more than 130 million global customers, GE Money, headquartered in London, UK, offers a range of financial products, including private label credit cards, personal loans, bank cards, auto loans and leases, mortgages, debt consolidation and home equity loans, and credit insurance. More information can be found at http://global.gemoney.com.
ABOUT GE GE (NYSE: GE) is Imagination at Work -- a diversified technology, media and financial services company focused on solving some of the world's toughest problems. With products and services ranging from aircraft engines, power generation, water processing and security technology to medical imaging, business and consumer financing, media content and advanced materials, GE serves customers in more than 100 countries and employs more than 300,000 people worldwide. For more information, visit the company's Web site at www.ge.com.
GE Money Communications ? Global/USARobert Rendine, +1 203
585 2084 Robert.rendine@ge.com or Communications
AsiaJin Montesano, +65 9639 7010 Jin.Montesano@ge.com
Tokyo (BUSINESS WIRE) - GE Money, the consumer financial services unit of the General Electric Company (NYSE: GE), announced today it has signed an agreement to sell its Japanese consumer finance business, which includes the Lake personal loan business, wholly owned credit cards and mortgages under GE Consumer Finance Co Ltd and its subsidiaries, to Shinsei Bank, a leading diversified Japanese bank. The transaction, which is subject to closing conditions, including regulatory approvals, is valued at Y580 billion (US$5.4 billion) and is expected to close in the third quarter of 2008.
Under the terms of the agreement, in addition to acquiring GE Money's loan, credit card, and mortgage businesses, Shinsei Bank plans to retain and work closely with GE employees in these businesses as part of its strategy to expand its position in the Japanese consumer credit marketplace.
Commenting on the transaction, William H. Cary, President and CEO of GE Money, said, "In an extremely challenging environment, we have completed an agreement that fully meets our core strategic objectives: giving our Japanese business the opportunity to work with a partner committed to investing in Japan, and allowing GE Money and GE to redeploy its capital to areas which will generate strong sustainable long-term growth and returns for our shareowners.
Yoshiaki Fujimori, President and CEO of GE Money Asia, said, "With its scale and expertise, Shinsei Bank is best positioned to leverage these businesses for continued growth and success in the long term. I would like to thank our employees in Japan for all of their tremendous efforts and hard work in building such a resilient and successful business."
As part of the transaction, GE and Shinsei Bank agreed to a risk-sharing arrangement relating to potential Gray Zone liabilities. GE does not expect potential losses to be materially higher than existing reserves.
GE Money will continue to operate GE Nissen Credit Co. Ltd, its credit card joint venture with Nissen, a leading shopping catalogue in Japan.
GE Money and Nissen will continue to hold a 50% stake each in the company and pursue further growth opportunities.
GE's Commercial Finance business has a strong presence in Japan, including leasing, fleet services, healthcare finance, and commercial real estate. In addition, GE continues to grow and invest in its Japanese businesses, including aircraft engines, energy, healthcare, and technology and media.
ABOUT GE MONEY With more than $200 billion in assets, GE Money, a unit of General Electric Company (NYSE: GE) is a leading provider of retail banking and credit services to consumers, retailers, and auto dealers in 55 countries around the world. With more than 130 million global customers, GE Money, headquartered in London, UK, offers a range of financial products, including private label credit cards, personal loans, bank cards, auto loans and leases, mortgages, debt consolidation and home equity loans, and credit insurance. More information can be found at http://global.gemoney.com.
ABOUT GE GE (NYSE: GE) is Imagination at Work -- a diversified technology, media and financial services company focused on solving some of the world's toughest problems. With products and services ranging from aircraft engines, power generation, water processing and security technology to medical imaging, business and consumer financing, media content and advanced materials, GE serves customers in more than 100 countries and employs more than 300,000 people worldwide. For more information, visit the company's Web site at www.ge.com.
GE Money Communications ? Global/USARobert Rendine, +1 203
585 2084 Robert.rendine@ge.com or Communications
AsiaJin Montesano, +65 9639 7010 Jin.Montesano@ge.com
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