Expects to Record an Estimated Pre-Tax Gain of $45 Million
NEW YORK, Aug. 16 /PRNewswire-FirstCall/ -- E*TRADE FINANCIAL Corporation
(NYSE: ET) today announced it has entered into a definitive agreement to sell
the origination and servicing business of E*TRADE Consumer Finance
Corporation, the Company's RV and marine lending business, to GE Consumer
Finance's Retail Sales Finance unit, for $60 million in cash. E*TRADE
FINANCIAL expects to record a pre-tax gain of approximately $45 million upon
closing.
Under the terms of the sale, $3.3 billion in RV and marine assets will
remain the property of E*TRADE FINANCIAL and will continue to be serviced by
E*TRADE Consumer Finance Corporation under GE Consumer Finance's ownership. In
addition, E*TRADE FINANCIAL will retain all assets originated through the
transaction closing.
"We continuously review all aspects of the business to ensure all
initiatives are core to the Company's long-term vision," said
Mitchell H. Caplan, Chief Executive Officer, E*TRADE FINANCIAL Corporation.
"We believe our customers and shareholders are best served by deploying
capital in a manner that accelerates the realization of that vision."
E*TRADE FINANCIAL also recently announced the acquisition of Harrisdirect
and Kobren Insight Management. Both business moves were directed at ensuring
all lines of business are aligned to rapidly achieve the Company's long-term
strategic goals.
"The sale of the consumer finance business allows us to further streamline
our business and allows us greater focus in generating the value that is
inherent in our business model," said R. Jarrett Lilien, President and COO,
E*TRADE FINANCIAL. "Maximizing opportunities for our retail customers to
engage directly with us to meet their investing, cash and credit needs will
yield the highest return for customers as well as shareholders."
The deal is subject to approval by all regulatory agencies. Following the
completion of the sale, GE Consumer Finance's Retail Sales Finance division
will re-brand E*TRADE Consumer Finance Corporation. Operations will continue
to be based in Irvine, Calif. and Clearwater, Fla.
"Combining efforts with E*TRADE enables us to bring the best of both
organizations to clients, customers and the industry," said Glenn Marino,
President and Chief Executive Officer of GE Consumer Finance's Retail Sales
Finance unit. "We look forward to maximizing the growth opportunities with
this move."
About E*TRADE FINANCIAL
The E*TRADE FINANCIAL family of companies provides financial services
including investing, trading, banking and lending for retail and institutional
customers. Securities products and services are offered by E*TRADE Securities
LLC (Member NASD/SIPC). Bank and lending products and services are offered by
E*TRADE Bank, a Federal savings bank, Member FDIC, or its subsidiaries.
About GE Consumer Finance
With $150 billion in assets, GE Consumer Finance, a unit of General
Electric Company, is a leading provider of credit services to consumers,
retailers and auto dealers in 47 countries around the world. GE Consumer
Finance, based in Stamford, Conn. (USA), offers a range of financial products,
including private label credit cards, personal loans, bank cards, auto loans
and leases, mortgages, corporate travel and purchasing cards, debt
consolidation and home equity loans and credit insurance. More information can
be at http://www.geconsumerfinance.com.
Important Notice
E*TRADE FINANCIAL and the E*TRADE FINANCIAL logo are registered trademarks
or trademarks of E*TRADE FINANCIAL Corporation. The statements contained in
this news release that are forward-looking are based on current expectations
that are subject to a number of uncertainties and risks, and actual results
may differ materially. The uncertainties and risks include, but are not
limited to, changes in market activity, anticipated increases in the rate of
new customer acquisition, the conversion of new visitors to the site to
customers, the activity of customers and assets held at the institution,
seasonality, the development and enhancement of products and services,
competitive pressures (including price competition), system failures, economic
and political conditions, changes in consumer behavior and the introduction of
competing products having technological and/or other advantages. Further
information about these risks and uncertainties can be found in the
information included in the annual reports previously filed by E*TRADE Group,
Inc. or E*TRADE FINANCIAL Corporation with the SEC on Form 10-K (including
information under the caption "Risk Factors") and quarterly reports on Form
10-Q.
CONTACT:
E*TRADE FINANCIAL Media Contact
Pam Erickson
E*TRADE FINANCIAL Corporation
+1-617-296-6080
pam.erickson@etrade.com
E*TRADE FINANCIAL Investor Relations Contact
Adam Townsend
E*TRADE FINANCIAL Corporation
+1-703-236-8719
adam.townsend@etrade.com
GE Media Contact
Mike Ettlemyer
GE Consumer Finance
+1-203-585-6791
michael.ettlemyer@ge.com
SOURCE E*TRADE FINANCIAL Corporation
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Related links:
http://www.etrade.com
CONTACT:
media, Pam Erickson, +1-617-296-6080, or
pam.erickson@etrade.com, or investors, Adam Townsend,
+1-703-236-8719, or adam.townsend@etrade.com, both of E*TRADE
FINANCIAL Corporation; or media, Mike Ettlemyer of GE Consumer
Finance, +1-203-585-6791, or michael.ettlemyer@ge.com
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