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Sep032013

03:39:15 am

Report: Ge To Spin Off Consumer Finance Business









The case, which attempts to halt the city's proposed use of eminent domain to seize mortgage loans from private label securitization trusts ("PLS Trusts"), is currently proceeding in the United States District Court, Northern District of California, San Francisco Division. "While SFIG recognizes the challenges currently confronting municipalities and borrowers, the use of eminent domain to seize mortgage loans is an illegitimate tactic that undermines the integrity of the entire home mortgage system," said Richard Johns, Executive Director of SFIG. "Allowing this type of practice is a short-sighted and unconstitutional idea. Not only would it do irreparable damage to the private mortgage market, undermining Congressional efforts to encourage private capital in the market, but it would also actually injure the local residents these efforts are supposed to be helping." The SFIG brief argues that efforts by Richmond and MRP to seize loans held in PLS Trusts is unconstitutional and could do permanent damage to the U.S. home mortgage system. The brief points to significant risk on three levels: -- The market for securities First Financial issued by PLS Trusts will be fundamentally shaken if the structure can be pulled apart by municipalities seizing loans, especially by cherry-picking individual performing loans. -- Each PLS Trust which holds to-be-seized loans will be damaged by an amount that exceeds the face value of the loan, because the structure, as a fixed, geographically diverse pool, will be undermined. The market value of the interests in the PLS Trust will likely decline by an amount which far exceeds the face amount of the loans seized. This injury may well be uncompensable through post-seizure compensation proceedings. -- Each PLS Trust which holds to-be-seized loans will, at a minimum, lose the value of those loans - which the seizure program, by its nature and structure, seriously undervalues as part of its very premise. The consequences will fall upon public and private pension plans, retirement accounts, college savings accounts, hospital and university endowments, and other funds, and ultimately will damage the ordinary Americans who are the beneficiaries of such accounts.








The newspaper also said Friday that the Fairfield, Conn., conglomerate is considering smaller spinoffs or asset sales, but it has started preliminary work on the IPO. The paper cited unnamed sources familiar with the matter. The consumer finance business provides store credit cards to about 55 million people for retailers like Wal-Mart Stores Inc. It accounts for $50 billion of GE Capital's $274 billion in outstanding loans, according to the report. Aside from its finance business, GE sells a wide variety of industrial equipment and appliances around the world. This includes jet engines, medical diagnostic equipment, oil and gas drilling equipment and washing machines. GE spokesman Seth Martin declined to comment on the report. CEO Jeff Immelt told analysts and investors at a conference in May that his company wanted a smaller GE Capital. He said they wanted to reduce the finance arm's assets from $402 billion in this year's first quarter to between $300 billion and $350 billion by the end of next year. "That is going to create excess cash in GE Capital, and we are going to use that excess cash to buy back stock," Immelt said. That asset total had dropped to $391 billion by the second quarter, according to Martin.







Finance and Pakistan pose twin challenges for Zimbabwe




They'll know this is their best chance to begin to correct their record of the past year, and if they do pull off a 2-0 win they'll gain two ranking points, widening the gap between themselves at No. 4 and Australia at 5. They'll be quietly confident of doing just that, with the shock loss in the first ODI a fast-fading memory given the two easy victories they registered thereafter. They had few problems cruising to a seven-wicket win the last time their Test side was in Zimbabwe, in September 2011 . Both sides have availability issues leading up to this match. The in-form Mohammad Hafeez had strained a hamstring in the third ODI and, though the injury is not serious, is a doubtful starter. Brendan Taylor's participation would depend on when his child is born - his partner went into labour on Monday. Form guide Pakistan LLLDD (last five matches, most recent first) Zimbabwe LWLLL Players to watch Tino Mawoyo is back in contention after recovering from a groin injury that kept him out for five months.




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