(Reuters) - General Electric Co's finance arm GE Capital said it is selling its healthcare equipment finance business worth $1.5 billion to U.S. regional lender TIAA Bank.
GE Capital used to issue financing for cars and aircraft and was once a big chunk of the industrial conglomerate's profits, but the 2008 financial recession raised the unit's funding costs and nearly sank the entire company.
Former Chief Executive Officer Jeff Immelt had in April 2015 announced a plan to reduce GE Capital's size and divest most of its assets. This was separate from GE's recent plan to focus more on profitable jet engine and power businesses and hive off other assets.
GE Capital's deal with TIAA comes nearly a month after it sold its portfolio of $1 billion in energy investments to private equity firm Apollo Global Management LLC
TIAA on Friday said it will acquire a portfolio that includes loans and leases to around 1,100 hospitals and 3,600 physician practices and diagnostic and imaging centers across the United States.
Both parties also signed a five-year vendor financing agreement for U.S. customers of GE's healthcare arm, the bank said in a statement.
TIAA is a Florida based bank that was founded in 1918 by Andrew Carnegie as a vehicle to serve not-for-profit organizations in fields, including academia and healthcare.
(Reporting by Bharath Manjesh and Arunima Banerjee in Bengaluru; Editing by James Emmanuel and Arun Koyyur)
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