By Angela Chen
General Electric Co. has agreed to sell GE Capital Bank's online
deposit platform and about $16 billion in deposits to Goldman Sachs
Bank USA.
The amount includes about $8 billion in online deposit accounts
and $8 billion in brokered certificates of deposit.
The transaction "advances GE Capital's new strategic direction
by facilitating closure of one of our two U.S. bank charters, which
we believe will help us become less systemically important," said
Keith Sherin, chief executive of GE Capital.t
General Electric earlier announced its intention t o sell
roughly $200 billion in GE Capital operations.
GE's commercial lending and leasing business supplies credit to
"middle market" companies, such as Midwestern grocery-store chains
and Wendy's restaurant franchises.
While the company has committed to shrinking GE Capital in the
wake of the financial crisis, it has viewed a smaller, safer
banking business as an integral part of a conglomerate better known
for its jet engines, power turbines and CT scanners.
In July, the Federal Reserve gave General Electric Co.'s finance
unit a temporary reprieve from having to face the central bank's
strictest regulations, a nod to how GE has already announced plans
to dramatically shrink the business.
The Fed's rule will delay until 2018 the moment when GE Capital
would have to start preparing for the Fed's annual "stress tests,"
maintain higher capital levels and add independent directors to its
board, among other regulations. GE Capital will still have to
comply with basic capital and liquidity rules starting Jan. 1,
2016, thresholds that the company has said it has already met.
Shares of GE have increased about 2% this year through
Thursday's close.
Write to Angela Chen at angela.chen@wsj.com
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