General Electric Co. is taking a loss against third-quarter earnings of between $800 million and $1 billion, after confirming reports it is seeking buyers for its personal loan business in Japan.
GE”™s Lake unit reportedly is the sixth-largest consumer finance business in Japan. GE is based in Fairfield and its GE Money consumer-finance arm is based in Stamford.
GE indicated it has been unable to earn an acceptable return on its investment in Lake due to new regulatory caps in Japan on interest charges for personal loans.
Earlier this summer, GE announced it would sell off WMC Mortgage of Irvine, Calif. Company officials reportedly said this month that the WMC divestment would cost it between $300 million and $400 million.
In the third quarter of 2006, GE Money had a $916 million operating profit on $5.6 billion in revenue.
In separate GE Money news, a joint venture will invest $200 million in India to create up to 250 mortgage offices in India, where GE Money already has more than 180 offices and 1.2 million customers. GE Money”™s partner in the venture is Wizard Home Loans of Australia.
Separately, a British Columbian company reached a $500 million contract to build a hydroelectric plant northwest of Vancouver, British Columbia, representing Stamford-based GE Energy Financial Services”™ first equity investment in Canada. The project is building “run-of-river” generators that do not completely dam rivers to create reservoirs, instead diverting water into steep channels that feed into generation stations.
GE Energy Financial Services is a unit of GE Commercial Finance.
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