UPDATE: GE to Sell U.S. Online Deposit Platform to Goldman Sachs Bank USA, $16B Deal

GE

announced today an agreement to sell GE Capital Bank's U.S. online deposit platform along with all deposits of GE Capital Bank, including online savings accounts, online CDs and brokered CDs, to Goldman Sachs Bank USA ("GS Bank"). Under this agreement approximately $16 billion of deposits will be transferred to GS Bank. The sale relates only to the deposit platform and deposits of GE Capital Bank. "As we work to reduce the size and complexity of GE Capital, this transaction is another key step. It advances GE Capital's new strategic direction by facilitating closure of one of our two U.S. bank charters, which we believe will help us become less systemically important," said Keith Sherin, GE Capital chairman and CEO. "I am confident that under GS Bank our deposit customers will continue to receive the high level of service and commitment they have come to expect," he added. The transaction is subject to regulatory approval and includes management, employees, software, and technology used to operate the platform. Scott Roberts, president of GE Capital Bank, is expected to join GS Bank to oversee the platform. GE Capital Bank is a Utah-chartered industrial bank. GE expects to wind down the remaining operations of GE Capital Bank following closing of the transaction, subject to regulatory approval. Synchrony Financial, the U.S. consumer financial services business majority owned by GE Capital, also takes retail deposits at Synchrony Bank. Synchrony Financial is targeted to be split off in a share exchange later this year, subject to regulatory approval. Sherin said, "Coupled with the split off of Synchrony Financial, this transaction will facilitate our complete exit from U.S. banking operations, eliminate the exposure of the U.S. deposit insurance safety net to GE Capital and thereby significantly reduce our regulatory footprint in the United States as we work to pair a smaller GE Capital with GE's long-term industrial growth." As previously announced, GE is embarking on a strategy to create a simpler, more valuable company by reducing the size of its financial businesses through the sale of most GE Capital assets and by focusing on continued investment and growth in its world-class industrial businesses. GE and its Board of Directors have determined that current market conditions are favorable to pursue these dispositions. GE will retain the financing businesses that relate directly to GE's industrial businesses.