General Electric's credit card unit today filed for an initial public offering, the first step in the conglomerate's planned exit from the retail finance business.
GE announced plans in November to spin off the business that makes credit card loans to consumers into a publicly traded company, which bankers estimated could be worth roughly $16 billion to $18 billion.
Through the spinoff, GE hopes to focus on its industrial divisions and better compete with rivals such as Honeywell International and United Technologies, which have smaller financing arms.
The company said in November that it would float up to 20% of the credit card business through the IPO, with a target to complete the exit in 2015.
The business, which will operate under the name Synchrony Financial, is the largest provider of private label credit cards in the US based on purchase volume and receivables, according to an IPO filing with regulators.
The cards are usually offered through major retailers and brands including Wal-Mart Stores, Lowe's and and Ethan Allen Interiors.
Synchrony had 62 million active accounts, financed about $94 billion of sales and reported net earnings of $2 billion for 2013, according to the filing.
GE Capital, which houses GE's financial operations, used to contribute nearly half of the company's total profit. But the unit's rising funding costs during the 2008 financial crisis nearly sank the entire company.
GE Capital posted revenue of $46 billion last year. The company was named a systemically risky financial institution last July by the US Financial Stability Oversight Council.
The designation, commonly known as "Too Big To Fail", in effect guaranteed more regulatory oversight of GE Capital.
GE has said the spinoff would be the "last major action" in its efforts to reduce GE Capital's share to 30% of the company's total profit.
