GE Overview: General Electric, or GE, is a corporate colossus that spans these six business groups:
- Infrastructure
- Commercial Finance
- GE Money
- Healthcare
- NBC Universal (Media)
- Industrial Products
GE Commercial Finance provides loans and leases to businesses.
GE Money offers:
- Home Loans
- Personal Loans
- Auto Loans
- Credit Cards
- Credit Insurance
Collectively, GE Commercial Finance and GE Money often are referred to as GE Capital in the press. This was the former name for these business groups.
As 2011 drew to a close, GE was in negotiations with MetLife to acquire the latter's consumer banking division. MetLife found compliance with new regulatory requirements to be too costly.
Size: GE reported these results for GE Commercial Finance for the full year 2007:
- Revenues = $34.2 billion
- Profit = $6.0 billion
- Revenues = $25.0 billion
- Profit = $4.3 billion
Total employment at GE (across all lines of business) was 327,000 at the end of 2007, with 155,000 based in the United States. Employment by business segment is not publicly disclosed.
Positives: GE has a long track record as a major player in the financial services industry, especially in the field of corporate lending. Were GE's financial segments an independent company, they would be more generally recognized as the industry leader that they are.
Additionally, GE as a whole has a long reputation as a very well-managed company that strives for excellence and rewards top performers. GE has a well-established philosophy of striving for market leadership in each of its business segments, and exiting businesses which do not hold out this promise.
GE takes employee training and education very seriously, investing about $1 billion annually, or around $3,000 per employee.
Through his Berkshire Hathaway investment company, legendary money manager Warren Buffett took a $3 billion stake in GE preferred stock. Taken on October 1, 2008 during the height of the market crisis, this was a major vote of confidence in GE.
Negatives: GE as a whole has been dogged in recent years by skepticism over its complexity and financial reporting practices. In particular, GE has been criticized for excessively creative accounting employed in the cause of managing earnings. Whether or not real problems are being obscured remains a matter for debate.
As a conglomerate spanning a variety of unrelated businesses, GE operates on a model that has been generally in disfavor among academic management theorists, because it lacks overall strategic focus.
In September, 2008 GE reported that its financial subsidiaries cannot be expected to contribute their usual 45% share of overall corporate profits, due to the financial market turmoil. However, GE still expects them to be profitable.
