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SCMP Reporter

AFTER obtaining full control of United Merchants Finance, GE Capital is changing the name of the finance company to GE Capital Finance, which it says reflects its new identity.

 The name change would be accompanied by a sharpened business approach as the finance company would be the main vehicle of United States giant GE Capital's expansion in Hong Kong and southern China.

 Residential property finance will be beefed up significantly, taking the room left behind by the flat growth in automobile finance.

  A mortgage finance expert will be brought in from the United States to flesh out for the expansion.

  The company will act as an agent servicing mortgage loans rather than as a big mortgage lender.

   So securitising mortgage portfolios, which has been GE Capital's expertise, will be considered.

  At present, GE Capital Finance's loan portfolio is dominated by automobile finance (40 per cent) and industrial and commmercial finance (30 per cent).

  Mark Holmes, the new managing director and chief executive of GE Capital, was brought in from Singapore. He is an expert in the area of equipment financing.

  Further expansion of equipment financing is expected, in particular, in southern China.

  'With the airport project and growing infrastructure spending, there will be enormous growth in equipment leasing,' said Mr Holmes.

  These three lines of business, coupled with personal loans, will form the primary thrust of GE Capital Finance's strategy.

  It will be coveting consumer-related finance such as credit cards and insurance-related business in Hong Kong.

  'We will be looking for opportunities for acquisitions and to develop new businesses where we see them complementing our strategy for development,' he said.

  GE Capital Finance, a restricted license bank, has assets of about US$600 million. Its profit last year was HK$25 million.

  Its profit and asset growth in the last five years were about 25 per cent. Half of its source of fund comes from revolving credit line in the inter-bank market.

  Half is from the HK$2 billion certificates of deposit (CDs) programme and a US dollar commercial paper programme in the amount of US$100 million.

  It will sign a three-year CD amounting to HK$700 million tomorrow.

 GE Capital is a subsidiary of General Electric.



GE Captial Finance aims to sharpen regional focus