New | GE set to sell Europe private equity unit to Sumitomo Mitsui Banking
Sumitomo Mitsui Banking Corp to purchase assets for US$2b, say sources
General Electric is close to selling its European private equity financing unit to Japan's Sumitomo Mitsui Banking Corp for more than US$2 billion, a person with direct knowledge of the matter said - the latest move by the US industrial conglomerate to shed financial assets.
Major Japanese banks, which were relatively unscathed by the global financial crisis of 2008, have been aggressively buying businesses and extending loans overseas to make up for a weak domestic market.
GE announced plans in April to exit US$200 billion worth of finance assets - assets which made it subject to government regulation as a systemically important financial institution.
GE has said it would apply to escape that oversight in 2016 as it reduces the financial business' size.
A spokeswoman for GE declined to comment, while a spokesman for SMBC, the core banking unit of Sumitomo Mitsui Financial Group, said nothing specific had been decided.
The deal was first reported by the , which said it could be announced early this week.
In other recent asset sales, GE said on Monday it was selling its fleet management arm in the United States, Mexico, Australia and New Zealand for US$6.9 billion. It is also selling its European fleet segment for an undisclosed sum that a source close to the matter said would be around US$3.3 billion.
Recent deals by Japanese banks include Mizuho Financial Group's agreement in February to buy Royal Bank of Scotland Group's US and Canadian loan portfolio in a deal worth US$3 billion.
