General Electric Co. (GE) is divesting consumer-finance businesses in the UK and Germany and selling its US corporate credit-card unit to concentrate on higher-margin areas and developing markets, GE Money’s chief executive said.

“This is a thoughtful effort to really, aggressively look at where we make money, where we don’t and where we should have capital redeployed,” William Cary, who was promoted to lead the consumer-lending unit in February, said in a telephone interview from London.

Last month GE agreed to sell its corporate charge-card unit to American Express Co. for $1.1 billion. It also agreed to swap GE Money units in Germany and the UK to Spain’s Banco Santander SA in exchange for Italian commercial lender Interbanca, which is valued at $1.58 billion.

London-based GE Money is departing from slowing or stalled credit-card markets such as those in the US and UK to focus on developing markets like Poland and India, Cary said. The company also is looking to western markets, including France, where its mix of products yields higher growth, he said.

GE Money, the world’s biggest issuer of store-branded credit cards, last year sold its US subprime unit, WMC mortgage, and put its Japanese consumer unit on the block. General Electric chief executive Jeffrey Immelt is seeking a partnership or sale of the US private label unit as he shifts up to $50 billion in assets to higher returns and lower risks of default.

“It’s not an exit from consumer finance, it’s part of a really deliberate strategy that comes from a pretty clear agreement with Jeff,” Cary, 48, said. GE Money competes with the commercial-finance division for capital to be invested in higher-return areas.

GE Money, as it was exiting WMC last year, agreed to buy part of UniCredit SpA’s Bank BPH unit in Poland for $893 million. In September, GE Money said it would invest $200 million in India by 2011.

The sale of the corporate-payment services unit to American Express should result in a gain of $200 million to $300 million, or 2 cents to 3 cents a share, and is included in GE’s first-quarter forecast of 50 cents to 53 cents a share, Lehman Brothers analyst Robert Cornell, Goldman Sachs analyst Deane Dray and JP Morgan analyst Stephen Tusa wrote in notes late last month.

“This divesture is in line with the strategic plan to lessen its exposure to GE Money-Americas and is part of the $30 billion to $50 billion in asset sales expected for the year,” Tusa wrote.

In the Santander transaction, GE gets Interbanca, which serves mostly midsized companies. Santander, Spain’s largest bank, will take over GE Money’s units in Germany, Austria and Finland, and credit-card and auto-finance divisions in the UK.

“This is a win-win: they get bigger in a market that they know and we can take the capital we have tied up here in the UK and put it to work in other places,” Cary said.

GE Money, with about $200 billion in assets, provided $4.28 billion of the parent company’s $22.2 billion in net income last year. About 75 percent of the segment’s sales and more than two-thirds of profit came from outside the US last year. Immelt has forecast profit would be little changed this year amid the asset shifts and the slowing US economy.

Developing Markets

General Electric Co. (GE) is divesting consumer-finance businesses in the UK and Germany and selling its US corporate credit-card unit to concentrate on higher-margin areas and developing markets, GE Money’s chief executive said.

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Revisiting Executive Privilege: CJ speaks

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Revisiting Executive Privilege: CJ speaks

DISSENTING OPINION  

PUNO, C.J.:

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