Mid-size Japanese lender Shinsei Bank Ltd. said Friday it would acquire the local financial arm of General Electric Co. for 580 billion yen ($5.4 billion) in a bid to boost its consumer finance business. Shinsei said the acquisition of GE Consumer Finance Co. Ltd. was part of efforts to expand its consumer finance operations, as well as credit card and mortgage businesses. “This acquisition is a critical next step in our pioneering approach to redefine consumer finance in Japan,” Shinsei said in a statement. GE Consumer Finance is Japan's sixth-largest consumer loan company. GE is involved in a wide array of financial services in Japan. GE said in a statement Friday it would continue to invest in its other Japanese businesses, including aircraft engines, energy and health care. Shinsei Bank was created in 2000 when a consortium led by US investment firm Ripplewood Holdings purchased the defunct Long-Term Credit Bank. Currently, US investment fund J.C. Flowers holds a 33-percent stake in the Tokyo-based bank. In Hartford, Connecticut, General Electric said its profit fell 6 percent in the second quarter, as discontinued operations and loss provisions weighed on results. It earned $5.07 billion, or 51 cents per share, compared with a year-earlier profit of $5.38 billion, or 52 cents per share. Total revenue has risen to $46.89 billion from $42.38 billion a year earlier. On the basis of continuing operations, GE said it earned $5.39 billion, or 54 cents per share. Thomson Financial said analysts expected the company to report earnings of 54 cents per share on revenue of $45.31 billion. In a statement, GE Chief Executive Jeff Immelt said the US economy is “challenged” but many other markets are healthy.
