Financial Roundup: GE Cuts, Credit Card Woes, Offshore Banking Probe, Crummy MBA Job Market

GE’s Focus: Fixing Financial Unit — Conglomerate GE is chopping away at its giant GE Capital financing unit. GE will take a charge of up to $1.4 billion to speed up shrinking the financing group through cost cuts, discontinuing some operations and decreasing leverage with reduced borrowing. GE says a tighter credit market and economy are forcing these major changes, which will result in fourth quarter earnings being at the low end of the company’s expectations.[Source: Bloomberg Business News].

Clear and Present Danger — The combination of tighter consumer credit and escalating job losses will add up to a long recession, according to the highly-respected bank industry expert Meredith Whitney. The Oppenheimer & Co. analyst says credit card providers will reduce lending by more than “$2 trillion over the next 18 months”. She adds this is a “dangerous and unprecedented” move that along with higher job losses will sap the economy’s strength. [Source: Clusterstock].

Justice Expands Offshore Banking Probe — The U.S. Dept. of Justice is expanding its criminal investigation into foreign banks that sell offshore private banking services to customers. The inquiry reportedly includes Credit Suisse and HSBC. Initially, the feds were looking into the overseas dealings of Swiss banking giant UBS. The big question: Are foreign banks illegally helping Americans hide assets and evade taxes?[Source: New York Times].

Who Wants To Hire An MBA? — Applications for MBA programs are up, but job opportunities for second-year students in finance or consulting are just awful. [Source: BusinessWeek].