Because of regulators imposing interest rate caps, General Electric Co. has decided to pull out of the Japanese consumer loan business....to the tune of losing $1.1 billion!
GE is actively looking for a buyer and wants to be out of Japan, sell the Lake personal loan business by the end of the third quarter of 2008.
"In connection with this exit, we expect to record an after-tax loss in the range of $0.8 billion to $1.0 billion in the third quarter of 2007, which represents the difference between the net book value of our Lake business and the projected sale price," GE said.
The Japanese parliament approved a lending law that lowered the maximum legal interest rate to between 15 and 20 percent, depending on the size of the loan, from 29.2 percent.
Gosh...GE won't be able to soak more out of the Japanese and their savings.
We talked about this very thing this morning at our Bible study this morning.
The credit card companies have scammed people into going into debt and then imposed such huge interest rates upon them that they can never get out.
Kind of like a legal loan sharking, if you will.
It seems the Japanese government wants to do/has done a bit of something about it.
But why 15-20% and not 5%? Give those in debt a chance to climb out.
What do you think?
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