NYU Stern
Share / Print
Faculty News

In an op-ed, Prof. Roy Smith discusses GE's plans to spin off its consumer finance business

financial news logo feature
Excerpt from Financial News -- "So far, the argument against spin-offs of troublesome investment banking units has been that the banks derive too much of their consolidated profits from them and that significant capital may have to be added before allowing them to become independent. But the Amex deal showed that these issues can be resolved. And a spin-off can be beneficial to shareholders who made significant gains from the increases in the stock prices of both units. The share prices of Citigroup, Bank of America, Barclays and Deutsche Bank are, on average, still 75% lower than they were in January 2008. Their boards could do well to monitor closely GE’s proposal and keep an open mind."

Read more