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01:11:09 pm

Report: Ge To Spin Off Consumer Finance Business

consumer lending business of its finance arm with an initial public offering of stock that could come early next year, according to The Wall Street Journal. 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.

This political backing has disappeared with the ouster of Mursi in an army-backed uprising in early July; the interim government which is to serve until elections early next year has much less fondness for Islamic finance. But underlying demand among Egypt's mostly Muslim population of 84 million, the country's need to develop what financing sources it can, and the growing role of wealthy Arab countries in the Egyptian economy mean the sector may still grow. "Sukuk will be available in Egypt particularly because they are the sole instrument used by some investors in the Gulf Cooperation Council and southeast Asia," Sherif Sami, the new head of the Egyptian Financial Supervisory Authority, told Reuters last week. Sami stressed his body would only handle the technical side of sukuk issues, and any decision to push forward with legal changes to facilitate sukuk would be political. DEMAND The technocrats who dominate Egypt's new economic policy team, many of them with experience from the Mubarak era, have shown little personal interest in Islamic finance. The image of political Islam has been severely damaged in the eyes of many Egyptians by Mursi's troubled year in office and his weak management of the economy.

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