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GE Consumer Finance

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GE Consumer Finance Powered By Docstoc
					 GE Consumer Finance
     Dave Nissen
      President and CEO, GE Consumer Finance
     Mark Begor
      President and CEO, GE Consumer
      Finance - Americas
     April 2, 2003
This presentation includes certain "forward-looking statements" within the meaning
of the Private Securities Litigation Reform Act of 1995. These statements are
based on management's current expectations and are subject to uncertainty and
changes in circumstances. Actual results may differ materially from these
expectations due to changes in global economic, business, competitive, market
and regulatory factors. More detailed information about those factors is contained
in GE's filings with the Securities and Exchange Commission. This presentation
includes certain non-GAAP financial measures as defined under SEC rules. As
required by SEC rules, at the end of this slide presentation we have provided a
reconciliation of those measures to the most directly comparable GAAP measure
and a copy of the relevant slides is available on our investor relations website.




   GECF Charter
   Net Income
   ($B)                                                                                             $1.8
             A. Double-Digit Asset and Profit Growth

                           B. Develop Consumer Marketing Zealots

                           C.       Risk Management Vigilance

                           D. Execute in a Huge Marketplace ($14T)
               $0.4




              ’95             ’96             ’97              ’98             ’99   ’00   ’01     ’02



                         A Strong, Growing Consumer Finance Business
                                                                                                 Nissen Analyst 040203 Final PDF2
GECF Global Reach
Argentina                                                      Korea
Australia                                                     Mexico
Austria                                                 New Zealand
Brazil                                                        Norway
Canada                                                        Poland
China                                                        Portugal
Czech Republic                                              Romania
Denmark                                                    Singapore
DOMs                                                         Slovakia
France                                                      Slovenia
Germany                                                         Spain
Hong Kong                                                    Sweden
Hungary                                                  Switzerland
India                                                         Taiwan
Indonesia                                                   Thailand
Ireland                                              United Kingdom
Italy                                                  United States
Japan

             Serving Over 103MM Customers in 35 Countries
                                                        Nissen Analyst 040203 Final PDF3




GECF Selling Model
                        Multiple Distribution
Broad Product Line           Channels              Target Customers

    Credit
    Cards                      Retailers

  Personal
    Loans                        Mail


     Sales
                            Telemarketing
   Finance

 Mortgages             Branches / Partner Points


     Auto                   ATM / Kiosks


 Insurance                     Internet


                                                        Nissen Analyst 040203 Final PDF4
GECF Business Overview
2002
             Served Assets                                   Net Income

                  Australia Japan                                 Japan
                    8%                                             25%
                             11%
                                      Asia                                         Asia
                                                 Australia
                                      5%                                           2%
                                                   5%
Americas
  35%


                                                Americas                             Europe
                                      Europe      33%                                 35%
                                       41%




                                    A Global GE Business
                                                                          Nissen Analyst 040203 Final PDF5




Products and Reach
2002

Product Lines – Served Assets                                    Reach

                    Sales Finance
                         7%
 Personal Loans
      18%                                       Active Customers                      103MM

                                                Cash Access Customers                   20MM
                                       Cards
                                        39%
    Auto                                        ATMs                                     175M
    19%

                                                Retail Outlets                           142M
 Commercial 3%
                   Mortgages
                     14%




                     Broad Range of Products and Broad Risk
                     Diversification with Large Customer Base
                                                                          Nissen Analyst 040203 Final PDF6
Financial History
        Served Assets ($B)                                        Net Income ($B)


           AAGR = 14%                                           AAGR = 31%                 $1.8
                             $80.0
                                                                         $1.6
                   $65.4
           $57.5                                                  $1.3
 $54.4


                                                       $0.8




  '99       '00     '01       '02                      '99        '00        '01            '02
  13%       13%      10%      13% Core Growth   ROE     25%       33%        38%             37%

                                                Net Income –
                                                Old 8:1 Basis     $1.4    $1.7              $1.9


                            Double-Digit Core Growth
                                                                             Nissen Analyst 040203 Final PDF7




                                GECF
                             Growth Model


                           • Core Acquisitions

                           • Core Growth




                        Consistent Double-Digit Growth
                                                                                                          8
Post Acquisition Growth
($B)


       Post Acquisition Income Growth                                                  23%
       Acquisition Year Income                                     $1.8               AAGR
                                                           $1.6
                                                 $1.3
                                                                    1.3
                                                           1.1
                                         $0.8
                                                  0.9
                                $0.6
                       $0.5
$0.4       $0.4                            0.5
                                 0.4
                        0.4                                0.5      0.5
 0.3       0.3                             0.3    0.4
 0.1       0.1          0.1      0.2

 '95        '96         '97      '98       '99    '00      '01      '02


             We Don’t Buy Growth … We Grow What We Buy
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Acquisition Process


                                                                                    Integration
                                                                                      Process


                                                             Negotiations


                                                  Deal
                                                 Pricing


                                Due Diligence

                     Pre-
                  Acquisition
                    Work

Hunting




             6σ Skills Make Integration a Science, Not an Art
                                                                          Nissen Analyst 040203 Final PDF10
Integration Plan


            • Agree Integration Charter           Pre-Closing
                                                       and
Phase I     • Dedicated Integration Resources
                                                “First 100 Days”
            • Investment Plan

                                                    Bring
            • GE “Non-Negotiables”                Advantages
Phase II    • Cross-Sell Opportunities             of GECF
            • Integrated Consumer Selling         Ownership
              Model
                                                   Position
            • Productivity / 6σ / ACFC           for Low Cost
Phase III   • Cost Reductions                       Growth



            Acquisition Integration a Core Competence
                                                        Nissen Analyst 040203 Final PDF11




BD Pipeline



    • Deals YTD ~ $10B NEAs



    • 5 Deals In Due Diligence


    • Good Geographic Spread of Opportunity –
      Europe, United States & Asia

                                                        Nissen Analyst 040203 Final PDF12
  Core Growth

                                         +                       Broad Distribution

                                          +                      Cross Sell / Up Sell

                                          +                      Consumer Marketing

                                          +                      Advertising

                                          +                      NPI


                               Double-Digit Core Growth 4 Years Running
                                                                                                                                                                 Nissen Analyst 040203 Final PDF13




  GECF Global Product Offerings
                                                                               Czech                                                                                                    Hong
                     UK   Sweden Norway Denmark France Austria   Ger   Switz    Rep    Poland Hungary   Spain   Italy   Portugal Ireland   Japan   India   Australia   Brazil Argentina Kong   Thailand   US


Product Lines


PLCC / Cards

Bank Cards

Sales Finance

Personal Loans

Mortgages

Auto Loan / Lease

Cash Access

Insurance / PPI

Savings / Deposits

Commercial Loans

Life

General




            PURCHASED

                                   Selective Purchase of Product Platforms
                                                                                                                                                                 Nissen Analyst 040203 Final PDF14
   GECF Global Product Offerings
                                                                                  Czech                                                                                                        Hong
                      UK   Sweden Norway Denmark France   Austria   Ger   Switz    Rep    Poland Hungary   Spain   Italy   Portugal Ireland     Japan   India   Australia   Brazil Argentina   Kong   Thailand   US


Product Lines


 PLCC / Cards

 Bank Cards

 Sales Finance

 Personal Loans

 Mortgages

 Auto Loan / Lease

 Cash Access

 Insurance / PPI

 Savings / Deposits

 Commercial Loans

 Life

 General




             PURCHASED                             ADDED

                                Significant Core Growth and NPI Expansion
                                                                                                                                                                    Nissen Analyst 040203 Final PDF15




   GECF Global Product Offerings
                                                                                  Czech                                                                                                        Hong
                      UK   Sweden Norway Denmark France   Austria   Ger   Switz    Rep    Poland Hungary   Spain   Italy   Portugal   Ireland   Japan   India   Australia   Brazil Argentina   Kong   Thailand   US


Product Lines


PLCC / Cards

Bank Cards

Sales Finance

Personal Loans

Mortgages

Auto Loan / Lease

Cash Access

Insurance / PPI

Savings / Deposits

Commercial Loans

Life

General




            PURCHASED                              ADDED                            OPPORTUNITY

                     Huge Opportunity to Expand Global Product Offerings
                                                                                                                                                                    Nissen Analyst 040203 Final PDF16
                    Controllership


            • Risk Management

            • Expense Management

            • Compliance




Risk Management

            GE’s Risk Management Policies
       • World Class Risk Management
          – Apps, Collections and Behavior Scoring
          – Rigorous Credit Line Management
          – High Tech Collections Centers
          – ~6,000+ Risk and Collection Professionals

       • We Do Not Target Sub Prime
          – Over 85% of U.S. PLCC Portfolio is “Prime”

       • Strong Reserving Policies
          – Reserves up 32% to $2.8B from 1Q’02
          – Revolving – 180 Day = Full Reserve / W/O
          – Closed End – 120 Day = Full Reserve / W/O
          – Strict Re-Aging Policies


               World Class Risk Management
                                                         Nissen Analyst 040203 Final PDF18
          Global Delinquencies
                                                               U.S.                                                                                                    U.S.
                                                              30+% O/S                                                                                                90+% O/S
                                                                                                                         3.0
          7.0
          6.5
                                                                                                                         2.5
          6.0
          5.5                                                                                                            2.0
          5.0
                                                                                                                         1.5
          4.5
          4.0
                                                                                                                         1.0
                          Jan    Feb Mar          Apr May Jun             Jul    Aug Sep Oct               Nov Dec
                                                                                                                                 Jan     Feb     Mar     Apr     May        Jun    Jul    Aug     Sep     Oct        Nov    Dec
                                YE 2001        5.7%             2001             2002          2003
                                YE 2002        5.3%                                                                                                          YE 2001         2.3%         2001          2002          2003
                                                                                                                                                             YE 2002         2.1%
   * Excludes Macy's, MCS & MWC-Non                                                                                      * Excludes Macy's, MCS & MWC-Non




                                                   International                                                                                                        igroup
   5.00%                                                                                                             17.00%
   4.50%                                                                                                             15.00%
   4.00%                                                                                                             13.00%
   3.50%                                                                                                             11.00%
                                                        30+                       90+                                                                                       30+                        90+
   3.00%                                                                                                              9.00%
   2.50%                                                                                                             7.00%
   2.00%                                                                                                             5.00%
   1.50%                                                                                                             3.00%
                                                                                         Nov




                                                                                                                                                                                                        Nov
                                                                                                                                                                             Jul
                                                                                                                                   Jan




                                                                                                                                                                      Jun




                                                                                                                                                                                                                      Jan
                                                                                                                                                               May
                                                                                                                                                 Mar




                                                                                                                                                                                                               Dec
                                                                                                                                                                                    Aug

                                                                                                                                                                                          Sep
                          Jan




                                                        Jun




                                                                                                     Jan




                                                                                                                                                                                                 Oct
                                                                                                                                                       Apr
                                                              Jul
                                      Mar




                                                                                                                                           Feb




                                                                                                                                                                                                                             Feb
                                Feb




                                                                                                               Feb
                                                                                               Dec
                                            Apr




                                                                    Aug

                                                                           Sep
                                                  May




                                                                                  Oct




* Excludes I-group & Accept             2002                                                           2003                                       2002                                                                2003


                                            Delinquencies Stable and Within Normal Variation
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        Loss Trends

                                                                                                           U.S.
                                                                                                                                                                                           Reserves = 18
                                                                                                            6.1                   6.5                                6.4                   Months of W/O
            Loss Rate %




                                            5.2                            5.2

                                                                                                International
                                                                                                                                                                                          Reserves = 190%
                                                                                                                                                                                              of “Non
                                            2.2                           2.3                               2.2                   2.4                                2.5
                                                                                                                                                                                            Performing”
                                            '99                           '00                              '01                    '02                          1Q'03E




         A Broad Range of Product Risk Profiles…
                                                                                                                                       Personal           Sales
                                                              Mortgage                  Auto                                            Loans            Finance                                         Cards


                                Loss Rate %
                                                               0                   1                       2         3                 4                       5                          6                           7




                                                        Losses / Delinquencies Have Been Stable
                                                                                                                                                                                     Nissen Analyst 040203 Final PDF20
 Productivity

OP & Admin /   7.0%          6.9%
   ANI %
                                            6.1%
                                                         5.7%


                                                      $2.9 Assets /
                                                                      Head
                                          $2.6
                                                                      ($B)
                            $2.3
               $2.1




               ’99           ‘00           ’01        ’02


           Consistent Double Digit Productivity Every Year
                                                         Nissen Analyst 040203 Final PDF21




 Compliance

                           Global Program

                 • Global Compliance Leadership

                 • Compliance Culture
                    – Spirit & Letter
                    – Ombuds System
                    – Key Priority of Acquisition
                      Integration
                    – “A” Players for Compliance

                 • Compliance e-Learning

                 • Secret Shoppers / Secret Audits


                More Than 200 Legal, Compliance and
               Audit Personnel Drive Global Compliance
                                                         Nissen Analyst 040203 Final PDF22
Regulatory Oversight
                 Number of Audits                    Audit Coverage
                                                    % Audit Time Per Function
                   76
                                    149
Ad Hoc                                                       8% 4%
Planned Audits
                   381                                                                   Adhoc
                                                                       16%
                                    293                10%                               Ops
                                                                                         Finance
                                                      6%                                 Compliance
                                                                         18%             IT
                  Budget           Actual
                                                      13%                                Risk
                                                                                         Other
     NYSB and Other Exams – 2002                               25%                       Branches
                 France
                 Brazil
                 Mexico
                 GECIFC Stamford            • Thorough Geographic Coverage
                 Hungary
                 Hong Kong
                 Germany GCF                • Key Risk Areas Regularly Monitored
                 Austria
                 Sweden                     • Satisfactory Audit Findings to Date
                 France
                 U.S.



Internal & External Regulatory Review Key to Strong Controllership
                                                                           Nissen Analyst 040203 Final PDF23




                                                       GE Consumer Finance



The Americas
Who We Are

                                    During the Year We…
• Provider of Private Label and
  Sales Finance Credit in the       • Open 21 Million New
  U.S.                                Accounts
• 100+ Retail Partners – Broad      • Purchase $61 Billion of
  and Long Term Relationships         Receivables
• Manage ~100 Million               • Send 550 Million Statements
  Accounts
                                    • Handle 86 Million Customer
• 13,000+ Employees
                                      Service Calls
• 25 Locations in U.S.,
  India, Mexico, Brazil and         • Process Payments Worth
  Argentina                           $60 Billion


                Premier Player in Retail Finance
         …Broadening into New Consumer Finance Products
                                                          Nissen Analyst 040203 Final PDF25




Retail Value from Private Label


           Reduce                      Increase
        Retailer Costs               Retailer Sales

                                     • “Open-to-Buy” and
         Substantially Reduces           Custom Promos
          Merchant Discounts
           Over Traditional          •   Specialized Marketing
              Bankcards              •   High Quality Service
                                     •   Customer Connection
                                     •   Higher Approval Rates
                                     •   Dedicated Credit Lines

               Private Label Customers Visit 50% More
              Frequently and Spend 30% More per Visit
                                                          Nissen Analyst 040203 Final PDF26
3 Key Business Levers


           1. Risk Management … Manage Losses


           2. Productivity … 5–10% per Year


           3. Growth … Double Digit Core




      Focus on Risk Management, Productivity and Growth
                                                        Nissen Analyst 040203 Final PDF27




1. Risk Management

             Loss Rate %                       Strategies

                                  • Tightened Credit Lines and
               6.5%
                                    Approvals
              Excess
    6.1%       Fraud   6.3%       • Enhanced Fraud Controls

                                  • Implemented Bankruptcy and
                                    Account Management Scoring

                                  • Continually Reinforcing Collection
                                    Staff

     '01        '02        '03E
                                    – ’01 +800 Collectors
                                    – ’02 +500 Collectors



       Losses Flat in a Tough U.S. Consumer Environment
                                                        Nissen Analyst 040203 Final PDF28
2. Productivity
Cost / Active Account



                                   (7%)
                                per year
                 $40.21



                                            $32.82




                   '99       '00      '01    '02


      ~7% Year-Over-Year Reduction in Cost/Active Account
                                                          Nissen Analyst 040203 Final PDF29




3. Growth Strategy
Served Assets ($B)

                                      1. Core Private Label Growth…
                 Acquisitions            Penetration, Functionality,
                   $35-40                New Clients
                 Pers. Loans
                  Dual Card
                    Sales             2. Card Expansion … Dual Card
    ~$28           Finance
    Sales
   Finance
                                      3. New Products … Personal
                   Private
    Private         Label                Loans, Secured Debt
     Label

                                      4. Acquisitions
   Today           2005

              Deep Interactions with Retailers Provides
               Platform for Growth and New Products
                                                          Nissen Analyst 040203 Final PDF30
Growth… Through Credit Penetration
            Penetration %                                  Key Initiatives…


                 36%                              • Customized Value Propositions
                              13%                   to Meet Retailer Specific Needs
                  11%
                                                  • Analytic-Based Targeting

     7%                                           • Cardholder Acquisition Technology

                                                  • Field Sales to Drive Penetration at
                                                    Store Level



     '98          '00          '02

           Credit Penetration Is Greatest Growth Opportunity…
                         100bps = $1.5B in Assets
                                                                         Nissen Analyst 040203 Final PDF31




Penetration … Customized Value Prop

 1         Unique Card Design
             • NASCAR / Team Lowe’s
             • Old Navy “Pick Your Color”

 2         Tailored Reward / Loyalty
             • The Gap               • Linens ‘n Things
             • Men’s Wearhouse       • Casual Corner


 3         Activation / Retention Campaigns
             • JCP “Insider Perks”
             • Premium Card Upgrades


 4         Big Ticket Products
             • 0% Credit Promotions
             • Lowe’s Low Pay Closed End

               Integrated with Retailers to Develop Programs
                          to Drive Top Line Growth
                                                                         Nissen Analyst 040203 Final PDF32
Penetration … Technology

Quick-
ScreenTM                          20% vs. 2.5% Response Rate



Kiosks                             85% Higher Activation Rate



Wireless                           50% Higher First Purchase
 PDA



       Bringing Technology to Cardholder Acquisition Process
                                                            Nissen Analyst 040203 Final PDF33




Penetration … Field Execution
Penetration %
               Top 20 Stores                     Bottom 20 Stores




                                                  Test Stores Delivered
Store Success Driven by…                         ~10X More Applications
                                           10X
• Clear Goals for Store Managers
  (X Apps / Day / Store)                    8X
                                                                         Before
                                                                         After
• Strong Store Credit Champions             6X


• Good In-Store Acquisition Events          4X


• Cashiers Ask for Card at POS              2X




               Using 6σ at Store Level to Drive Penetration
                                                            Nissen Analyst 040203 Final PDF34
 Growth … New Private Label Clients
                                                                  Targets

      1       Outsourcing       Retailers with In-House             $10B
                                Private Label Programs


      2       Competitive       Private Label Programs                $3B
                                with Competitors


      3       Start-Ups         Retailers with No Private             $5B
                                Label Program



      4       Commercial        Business Customers                    $2B


                   Room to Grow in U.S. Private Label
                                                                 Nissen Analyst 040203 Final PDF35




 Growth Through Sales Finance
            Served Assets ($B)                              Industries
                                  $6.4+                          # Locations
                      Conseco      2.2+           Healthcare        26,000
                                                  Auto/RV           13,000
                                           21%    Flooring           8,000
                                  ~$4.2   AAGR
                     $3.7                         Electronic         6,000
           $3.3
                                                  Home Improvement   4,000
Best Buy                           ~4.0
                                                  Furniture          2,000
                     3.3
On-Going   2.7                                    Jewelry            2,000

                                                   • 3 to 48 Month Terms
           ’01       ’02           ’03E
                                                   • 76% Pay-Off Early
ROI        1.8%      2.8%         ~2.9%
NI ($MM)    $59       $98         ~$150            • 40% of Consumers Are
# Accts     9.6      10.9         15MM
                                                     One Time Shoppers


                  A High Growth, High Return Business
                                                                 Nissen Analyst 040203 Final PDF36
New Products … Personal Loans
                                             Personal Loan Strategy
      Lifecycle Vision
                                      Determine Optimal Times to Offer
    Sales Finance                     Loan During Sales Finance Cycle
                       Today
     Transaction                                 Actives           +    Inactives

                                      (Months)     12              24          36

       Extend
                                                 Offer?       Offer?       Offer?
        Line
                                              13MM
                                             Accounts
      Bankcard                                Active              Offer at 12 – 24
       Access                                    (2MM)                Months

                                             Inactive             New Offer After
                                              (11MM)               Loan Pay-Off
      Personal
       Loan



                    Great Cross-Sell Opportunities
                                                                          Nissen Analyst 040203 Final PDF37




New Products … Dual Card
Private Label Product Extension … Not a Stand-Alone Bankcard

                                                 30 Million PLCC
                                                  Cardholders



                                                        Inactives
 • Dedicated In-Store Credit Line and Out-                (16MM)            Dual Card
   of-Store Utility                                                          Target

 • Integrated Servicing
                                                    Transactors
     – Build on PLCC Customer Service,                    (7MM)
       Manufacturing, Client Management
       Team, etc. …                                  Revolvers                  Private
     – Single 1-800 Customer Service                      (7MM)                  Label
     – Single Billing Statement


 $5B+ Asset Opportunity in 3–5 Years … On Track for ’03 Launch
                                                                          Nissen Analyst 040203 Final PDF38
  U.S. Consumer Finance Landscape
  Assets ($B)

                                                                                Private Label
                                                       $7,100
                                                         $93                      GE=$28




                                       Revolving
                                                        $610    Bank
                                                                Card




                                       Non-Revolving
                            Products
                                       Real Estate      $966    Loans




                                                       $5,431 Mortgage/
                                                              Home Equity




                 Huge Market with Big Growth Potential for GE
                                                                                                   Nissen Analyst 040203 Final PDF39




 Financials – Americas
                Served Assets ($B)                                                       Net Income ($MM)

Core Growth                                            15%

                 $28.2                                                                                 ~+15 – 20%
                                                       $27.2+                              $627
                                                        2.2+    Conseco
      THD        7.2
                                                       $25.0     19%
                 $21.0




                 '02                                   '03E                                 '02              '03E
Headcount       7,614                                  6,697              ROE              46.2%         ~50 – 55%

# Active A/Cs    45                                    47MM               Loss Rate %      6.5%              6.3%




                         Continued Asset and Earnings Growth
                                                                                                   Nissen Analyst 040203 Final PDF40
GECF Global Growth Drivers

       • Core Growth and Core Acquisitions

       • Productivity Focus

       • Risk Management Vigilance

           Europe
                          Asia      Japan




                                    Australia
                                                    New Zealand

                                                     Nissen Analyst 040203 Final PDF41




Europe 2003

                                                Acquisitions
                                                U.K. Consumer
                                                U.K. Mortgage
                                                Turnarounds
                                                Eastern Europe
                                                Pricing
         Growth                                 NPI
         Drivers

                                                Productivity
                                                Risk Management
      Foundation                                People
                                                Financials


                Key Agenda Items for 2003
                                                     Nissen Analyst 040203 Final PDF42
Growth: Eastern Europe
Presence in EU Accession Countries

                 Population      NEAs ($B)          NI           NI
                   (MM)        ’99       ’02       ’02          ’03E
• Czech Republic    10        $0.4      $1.1      $38
• Hungary           10          0.0       1.0       22           30+%
• Poland            40          0.4       1.3       27
  Total             60        $0.8      $3.4      $87MM




                      GDP per          Consumer
                       Head           Indebtedness
                       ($M)             (% GDP)
• Eastern Europe        4.7                7%
• EU Average           20.8               50%


                   Future Growth Engine in Europe
                                                            Nissen Analyst 040203 Final PDF43




Productivity


       Key Metrics              ’01         ’02      ’03E


        Op & Admin/ANI %         4.3        3.6      3.4




        Assets/Head ($B)         2.3        2.8      3.0




            Cost Out Rhythm and Rigor Well Established
                                                            Nissen Analyst 040203 Final PDF44
Risk Management
  Delinquencies                                                   ’03 Forecast
                                                           7.0%
                                                                                         ’02P       ’02A     ’03E
                                                           6.0%

                                                           5.0%   30+ (excl. igroup)         4.4%   4.2%       4.3%
                                                           4.0%

                                                           3.0%   90+ (excl. igroup)         2.1%   2.1%       2.0%
                                                           2.0%

                                                           1.0%
                                                                  Loss Rate %                1.3%   1.4%       1.5%
                                                           0.0%
'01 Q1 '01 Q2 '01 Q3 '01 Q4 '02 Q1 '02 Q2 '02 Q3 '02 Q4
   30+ (excl igroup)
   90+ (excl igroup)



                                                          ’03 Initiatives
                       • Fraud: Asset Verification & Early Write-off Detection
                       • Growth: Approval Rate Champion Challengers
                       • Collections: Building Performance Dashboard


Stable Portfolio Performance … Positioned for Further Growth in ’03
                                                                                                      Nissen Analyst 040203 Final PDF45




Financials - Europe
                        Served Assets ($B)                                              Net Income ($MM)

 Core Growth                           13%                10%

                                                      $36.4                                                   ~+15 – 18%
                                     $33.2
                                                                                         32%        $671
                        $25.9
                                                                                       $510




                         '01           '02                '03E                         '01           '02             '03E

Headcount               10,826       11,389          11,851          ROE               31.2%        32.2%     ~32 – 34%

# Active A/Cs             15           16            18MM            Loss Rate % 1.2%               1.4%          1.5%



  Core Growth, Productivity & Risk Vigilance Driving Strong Results
                                                                                                      Nissen Analyst 040203 Final PDF46
Japan Business Overview

Sales Finance                                               Personal Loans                                             Credit & Cash Cards




                         Second Mortgage                                                     Web Service




                 Lending $10B to Over 3MM Customers…
          Enhancing Productivity by Centralizing Branch Processes
                                                                                                                              Nissen Analyst 040203 Final PDF47




Productivity
  Results
                                      ’01                                               ’02                                          ‘03E
OP & Admin
/ ANI %                             6.7%                    (70bps)                     6.0%                        (30bps)          5.7%




  Comparison (Est.)
                                                                                        Manned                                 Opex/
                                    NEA ($B)                   Kiosks                  Branches                     EFT         ANI
   Citi                                    $13                        370                    850                    6,300       9.4%
   Takefuji                                  15                    1,320                     530                    3,750       4.9%
   Acom                                      14                    1,240                     520                    4,360       8.0%
   Promise                                   12                    1,050                     460                    3,979       7.9%
   Aiful                                     11                    1,050                     530                    3,600       7.7%
   GECF-Japan                               9.6                    1,032                     304                    3,093       6.0%

 * ’02 Yr. End estimate for Citi, 02 Yr. End Actuals for GECF including all businesses, ‘02/3 data for all others




                                                                                                                              Nissen Analyst 040203 Final PDF48
 Risk Management
                                    New Accounts Quality                                                                                                                                 Bankruptcy Control
                                                                                                                                                                                      • Upgrading Bureau BKO
                                     Early Stage Bankruptcies
                                                                                                                                                                                        Application Scores
       1.2%
                                                                                                                                                                                      • Continuing to Manage Credit
       1.0%
                                                                                                                                                                                        Lines – More Cleverly with
                                          JV                                                                                   Personal Loan
       0.8%                                                                                                                                                                             BKO Behavior Scores
BKO%




       0.6%

                                                                                                                                                                                      • Driving Early Collections on
       0.4%
                                                                                                                                                                                        High BKO Risk Accts
       0.2%


       0.0%                                                                                                                                                                                     Delinquency
                       Mar-00




                                                                             Mar-01




                                                                                                                                     Mar-02
              Jan-00




                                May-00

                                         Jul-00




                                                                    Jan-01




                                                                                        May-01

                                                                                                 Jul-01




                                                                                                                                              May-02

                                                                                                                                                       Jul-02
                                                                                                                            Jan-02




                                                                                                                                                                         Nov-02
                                                  Sep-00

                                                           Nov-00




                                                                                                          Sep-01

                                                                                                                   Nov-01




                                                                                                                                                                Sep-02
                                                                                      Booking Month
                                                                                                                                                                                      • Slight Increase in Q4’02;
                                                                                                                                                                                        Essentially Flat Planned in ’03


       BKO’s Up but Manageable … Seeing Better Performance on Newer
       Accounts … Minimizing Overall Increase with All Possible Actions
                                                                                                                                                                                                        Nissen Analyst 040203 Final PDF49




 Financials – Japan

                                                   Core
                 $9.2B                            Growth
                                                   +6%                                                    ~$450MM
                                                                                                                                                       ~(10%)
                                                                                                                                                                                            Summary

                                                                                                                                                                                  • 6% Core Served Asset Growth

                                                                                                                                                                                  • Continued Productivity Gains

                                                                                                                                                                                  • BKO’s Up but Manageable

                                                                                                                                                                                  • Huge Market Offers Plenty of
                                                                                                                                                                                    Opportunities
 Served Assets                                                                                        Net Income
      ’03                                                                                                 ’03
                                                                             ROE ~50 – 52%


                                                                                           Very Profitable Core Business
                                                                                                                                                                                                        Nissen Analyst 040203 Final PDF50
Australia and New Zealand Business Overview


                                           Personal Loans
                           Sales                                  Cards
                          Finance




                           Auto                               Mortgages




                                    Insurance            New
                                                        Zealand




 Present in all Major Product Lines … As the Clear Segment Leader
                                                                                   Nissen Analyst 040203 Final PDF51




Financials – Australia and New Zealand
          Served Assets ($B)                                      Net Income ($MM)
 Core Growth                            8%
                                                                                         ~+33 – 38%
                                       $6.4
                         $6.0
                                                                          20%    $96
                                                                    $80

                 $2.4




                 '01     '02           '03E                         '01          '02            '03E

Headcount       1,558   2,652         2,795         ROE            42.2%        25.0%     ~23 – 26%

# Active A/Cs    2.0     3.3          3.6MM         Loss Rate % 2.0%            1.9%          1.8%



       Rapid Growth Through Acquisition – Need to Re-Energize
                      Core Growth and Margin
                                                                                   Nissen Analyst 040203 Final PDF52
 Asia Business Overview



                                            • 70% Auto;
                                              3,299 Employees

                                            • Good Economic
                                              Recovery

                                            • 3 Billion Population




                      New Player in Dynamic Market
                                                               Nissen Analyst 040203 Final PDF53




 Growth
                                              # of Accounts
                                              ('000)           5,638
• Deepening Consumer Relationships                                       India
                                                       4,299

• Product Expansion                         3,189
                                                                         Thailand
   – Cash Enabled Products
   – Enter Motorcycle Markets                                            Indonesia
                                                                         Taiwan
                                                                         Singapore
                                                                         Korea
                                                                         Hong Kong
   – Introduce Insurance Products
                                             ’01       ’02     ’03 E
• Partnerships
• Distribution
   – Branches in Malls / Train Stations




                      Strong Core Growth     30+%
                                                               Nissen Analyst 040203 Final PDF54
Financials - Asia
          Served Assets ($B)                     Net Income ($MM)
Core Growth               53%    33%
                                                                       ~+30 – 35%
                                $4.8
                                                              $46
                                                       59%
                        $3.6
                                                      $29
                $2.6




                '01      '02    '03E                   '01     '02            '03E

Headcount       2,037   2,565   3,170   ROE           18.7%   21.0%      ~20 – 22%
# Active A/Cs   1.9      2.4    3.5MM   Loss Rate %   2.4%    3.4%           2.9%




                Strengthening Execution Across All Platforms
                                                               Nissen Analyst 040203 Final PDF55




                                                 GE Consumer Finance



 2003 Deliverables
1Q’03 Growth
Served Assets
($B)

                                        20%
                                              $77.7
                                $64.9




                                 '02          '03E


                 On Target for Solid Double Digit-Growth
                                                             Nissen Analyst 040203 Final PDF57




Net Income
($MM)
               1Q’03                                   Total Year


                                                        ~+15-20%
                  ~+10%
                                              $1,798
       $498




       1Q'02           1Q'03E                    '02          '03E


                                                             Nissen Analyst 040203 Final PDF58
Summary

  • Tiny Market Share in a $14T Market

  • Consumer Marketing Zealots with a Strong Global
    Infrastructure

  • 6σ Process Discipline Driving Productivity

  • State of the Art Risk Management

  • Proven Formula for Success… Core Acquisitions
    and Core Growth



       A Strong, Growing Consumer Finance Business
                                                 Nissen Analyst 040203 Final PDF59

				
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