Dave Nissen
CEO
Asia
Australia / New Zealand
ANZ: From Start-Up To #6
Assets
($ Billions)
$29.0
AVCO
• #1 Non-Bank Financial Institution…
$0.5
• …Meeting Full Range of Financial Needs… • …With Innovative Products Delivering Value, Convenience and Flexibility
'95 '96 '97 '98 '99 '00 '01 '02 '03 '04 '05 '06
Average Annual Growth Rate 50% Since 2000
3
ANZ: Credit Cards
Loyalty Bankcard Assets
$1.9B $1.4B $1.2B
$.3B
Low Rate
'03
'04
'05
'06E
4
ANZ: Mortgages
77% Brand Awareness Assets
$18B $15B $13B
Distribution : 250 Branches
$0.4B
Sponsorship
'03 '04 '05 '06E
5
GE Money New Zealand Growth Story
Assets
$3.0B
Mortgages
AVCO
'99
'00
'01
'02
'03
'04
'05
'06E
Building Diversified Portfolio
6
Japan
Diversified Player in a Large Market
Asset Growth
($ Billions) $8.9
Background & Key Initiatives
‘94: Entered Japan Consumer Finance Market ‘98: Acquired ‘Lake’ Personal Loans ‘03: Acquired Card Business
18% CAGR 18% CAGR
$1.2
'94 '98 '00 '02 '04 '05 '06E
’05: Growing Mortgage Platform
8
Japan Environment
Market Dynamics
+ ~$4 Trillion Consumer Finance Market + Economy Growing (GDP + Credit Friendly Consumers – New Regulations Impacting Personal Loan Business:
– APR Cap ~ 18 - 20% (3 yr phase-in) …Certain Fees Will Be Allowed – Increased Consumer Interest Refunds … Factored In ’06A
Strategic Priorities
• Evolve Personal Loan Model • Continue to Drive Productivity (OPEX 12% vs. ‘04) • Use BD to Drive Scale • Diversify GEM Mix … Grow Card & Mortgage
2%)
Changing Environment… Strong Long Term Prospects
9
Japan Personal Loans: LAKE
Receivables Key Initiatives
•Pricing Initiatives
$6.8B ~6.6B - Graduation Pricing - Yield Optimization
•Continue to Drive Productivity
- Fewer Manned Branches '05 '06E
•Invest in Automatic Lending Machine
Net Revenue Margin %
23%
22%
- Refurbish/Relocate - Upgrade Technology
10
Growth in Japan Mortgage
Mortgage - Japan
Mortgage Market
GE in 8 Bank Alliance
(First in Japan)
GE Assets
($ Billions)
Rising Valuations
16% NonConforming
$6.0
70% CAGR 70% CAGR
$1.6T
$1.3 $0.7
’05
’06E Segment Share:
(Non-Conforming)
’07F
’10F
• Bank References for Near Prime, Niche Plays • More GE Distribution… 3X Branches by ‘09
2%
5%
Strong Growth In Non-conforming And Second Mortgage
11
Rest of Asia
Asia: China and India
Partnering in China
1. More in China
7% Share?
More in India
1. Branches (150+)
Shenzhen Development Bank
2. Dual Cards
Wal-Mart Card in ’06
2. Launch Wizard in India
Mortgage Market
$80B
33% $37B
$14B ’02 ’05 ’08F
3. Auto JV (’07)
3. Expand SBI Cards Partnership
3MM Cards
Refocusing Management Resources
13
Asia: Emerging Markets Banking
Thailand Philippines
• Keppel Bank (100%)
+
GE Money Retail Bank Bank of Ayudhya* (24%)
Simply Better Banking
Taiwan
• Cosmos Bank (10%)
Consumerize the Bank
• Lever GE Expertise on Auto, P-Loans & Mortgage
*Expected to Close January 2007
Targeting $100MM Net Income In 5 Years
14
Asia: Growth through Partnerships
SBI Cards – India
• #2 Issuer… SBI #1 Bank in Assets… 51%+ Cards in Force vs ’05
Hyundai Auto - Korea
• Maintain 85% Auto Loan Segment Share
ASF - Indonesia
• #1 Auto Financier… Increase Astra Sales Share
Hyundai Card - Korea
• Invest in Marketing for Growth… #1 in Web Share of Voice
Partnering With Market Leaders
15
Total Asia: Simplification / Productivity
Key Actions
90 bps 90 bps
28.2% 27.3% • LCC Targeting Japan, HK & Singapore
G&A / CV
• Japan Model Restructure
• Pan Asia Card Back Office • LEAN! ’05 ’06E
16
Performing: Solid Growth
Assets ($B)
$45.7 $47.2 ~$52.0
Asia
• Strong double digit growth ex Japan • Diversify Japan platform & reposition Lake business model
'04
'05
'06E
• Partner in new developing markets • Pursue retail banking opportunities • Continue to grow diversified portfolio in Australia • Drive productivity across the region
Net Income ($B)
$0.9 $1.0 ~$1.0+
'04
'05
'06E
Asia is a strong growth opportunity for GE Money
17