Buyers shying away from GE's credit card business -WSJ
NEW YORK, June 25 (Reuters) - General Electric Co's (GE.N: Cotización) auction of its $30 billion credit-card business is attracting only tepid interest, according to an article on the Wall Street Journal's website.
Prospective buyers are afraid that customers of stores like Wal-Mart Stores Inc (WMT.N: Cotización), J.C. Penney Co (JCP.N: Cotización) and Lowe's (LOW.N: Cotización) are having trouble paying their bills, said the report.
JPMorgan Chase & Co (JPM.N: Cotización), which was seen as a likely acquirer of the business, recently dropped out of the bidding, the article said, citing people familiar with the situation.
Other companies with large credit-card portfolios, such as Citigroup Inc (C.N: Cotización), Bank of America Corp (BAC.N: Cotización) and Capital One Financial Corp (COF.N: Cotización), also aren't expected to submit bids, as a result of rising delinquencies and charge-offs in their own card portfolios, said the report.
In addition to Wal-Mart, J.C. Penney and Lowe's, GE also issues cards for a other retailers, including Brooks Brothers, home-furnishing chain Ikea and the Dillard's department-store chain.
GE is one of the largest issuers of so-called private-label credit cards, which can be used only in specific stores.
Retailers may help to pitch these cards to customers, but GE -- or any other private-label issuer -- bears the financial responsibility of owning the loans, the article noted.
Jeffrey Immelt, GE's chairman and chief executive, has personally reached out to prospective buyers, said the report, citing a person familiar with the situation. (Reporting by Euan Rocha; Editing by Kim Coghill)
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