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| GE to cut costs by $2 bn in finance unit |
| Press Trust of India / New York Nov 19, 2008, 20:49 IST |
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American conglomerate General Electric is planning to slash costs by $2 billion in 2009 at its finance arm GE Capital, the unit which has been severely hit by the global financial turmoil.
In a statement issued here, the company announced a new GE Capital organisation structure to drive growth.
"With this more efficient organisation, we are projecting about $2 billion in savings at GE Capital in 2009. These savings and the continued focus on optimising the portfolio increase flexibility and advantage of opportunities created in the current market and drive value for our shareholders," a statement on GE Reports.Com, one of the websites of the company said.
The new structure coming into effect from January 1, 2009, would consist of operational poles in Europe, Asia and the America.
"We also have created two new platforms to take advantage of new opportunities and leverage our expertise, one for consumer-focused international banks and JVs, and another focused on optimising returns on non-strategic assets. The new structure is effective January 1, 2009...," it noted.
Meanwhile, UK daily Financial Times in a report published online today said, "General Electric is to shrink GE Capital, its finance arm, in a move that could lead to $2 billion in cost cuts, the sale of $90 billion in highly leveraged assets and thousands of redundancies among its 75,000 employees."
According to Michael A Neal, who is the chairman of GE Capital, over the last two months, the firm has acted decisively to improve the funding position.
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