Shinsei to buy GE's Japanese finance unit

0 Comments | AFP, July, 2008

TOKYO (AFP) — Japan's Shinsei Bank said Friday it had agreed to buy US giant General Electric's Japanese consumer finance arm for 580 billion yen (5.4 billion dollars) in a major push into the troubled sector.

Shinsei, a mid-sized lender that is about one-third owned by US buyout firm JC Flowers & Co., said it would pay in cash for GE Consumer Finance Co.'s loan, credit card and mortgage business in Japan. The deal is expected to be completed in the third quarter of 2008.

The US conglomerate is not the only foreign group exiting the troubled sector. Citigroup, reeling from the subprime mortgage crisis, said last month it was closing down its remaining consumer lending outlets in Japan.

Consumer finance used to be a cash cow for banking groups in Japan, but...