Colombia’s Grupo Aval said on Thursday it has reached a deal to buy Central America-based banking group BAC-Credomatic, which is controlled by U.S. giant conglomerate General Electric Co.
Grupo Aval, controlled by Colombian banking magnate Luis Carlos Sarmiento, told local market regulators that the price of the deal is $1.9 billion.
For much of the past two years, the largest U.S. conglomerate has been working to trim back its GE Capital finance arm, which generated about half of its profit prior to the financial crisis.
Chief Executive Jeff Immelt has repeatedly said the company let its finance unit get “too big” and wants to trim it back to focus more closely on financing equipment sales, making commercial loans and investing in real estate.
Earlier this year, the Fairfield, Connecticut-based company reached deals to sell its stake in Turkey’s Garanti Bank and its Hong Kong consumer finance business.
GE management aims to reduce the finance arm’s total ending net investment — a measure of how much it needs to fund — to about $440 billion by the end of 2012, down from $472 billion at the end of last year. (Reuters)