General Electric Hands Dodd-Frank Its Biggest Victory Yet:sell off most of its financial operations
General Electric said Friday that it will sell off most of its financial operations, in what will be the most dramatic restructuring of the American banking system yet effected under the 2010 Dodd-Frank Wall Street reform law.
"I see this as a win not just for too-big-to-fail, but for the extension of the regulatory perimeter in Dodd-Frank," said Marcus Stanley, policy director at Americans for Financial Reform. "You basically had one of the largest consumer and investment banks in the country stapled onto a major industrial corporation, and because it was part of this conglomerate, it wasn't being regulated like a major bank. When the Fed changed that regime, GE decided it wouldn't be as profitable."
GE will sell off real estate assets to Wells Fargo and the private equity firm Blackstone. The industrial behemoth will retain its financing operations related to aircraft, energy and health care, but the overall value of its banking business will shrink to $90 billion, down from $538 billion in 2008 and $363 billion at the end of 2014.
GE said it would "work closely" with regulators to take whatever action is needed to shed its status as a "Systemically Important Financial Institution," which subjects the firm to tougher capital and regulatory standards.
http://www.huffingtonpost.com/2015/04/10/ge-dodd-frank_n_7041662.html
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