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GE Money pulling out of car business

 

Finance company victim of credit crunch

 GE Money, one of the biggest funders of non-bank housing loans and car loans in Australia and New Zealand, is downsizing its business and axing 335 staff as funding costs rise.

The company said last week it will end its motor finance and small business finance on both sides of the Tasman.

"This is a result of the extreme volatility and greatly increasing cost of funds on the global and local wholesale markets,'' GE Money said in a statement.

Of its 4500 employees, 110 will leave in the next four weeks, with a further 225 to be laid off over the next 12 months.

The company said the measures will have no effect on its retail store finance, credit cards, personal loans and insurance businesses.

GE Money's Australia and New Zealand chief executive, Mike Cutter, blamed the "unprecedented conditions'' on global credit markets for the steps.

Meanwhile, Custom Fleet, one of the biggest vehicle leasing companies in New Zealand, says it won't be offering any new leases for the foreseeable future.

Custom Fleet, ultimately owned by GE, says its moratorium on new leasing in both New Zealand and Australia is short term. It will continue to service existing leases


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