Nov 25, 2002 (07:11 PM EST)
E-Trade Continues Diversification Through Lending Acquisition
Read the Original Article at InformationWeek
E-Trade Group Inc. continues its aggressive move into new markets as the Internet-based financial-services firm further diversifies its business lines. The company said Tuesday that its E-Trade Bank division will acquire the consumer-finance business Ganis Credit Corp., a U.S. subsidiary of Deutsche Bank AG, for approximately $101 million. The deal is expected to close next year.
The acquisition will let E-Trade offer customers loans for recreational vehicles and marine and motor-sport equipment. E-Trade will take on $1.7 billion in recreational vehicle, marine, and motor-sport loans from the sale.
E-Trade, which made its name in the 1990s as one of the largest online-only discount brokerages, has been working toward becoming a full-service financial institution through a string of acquisitions during the past few years. Today, the company's brokerage services garner only one-third of E-Trade's revenue, with mortgages and other services making up the rest. Conversely, in 1998, brokerage fees and commissions accounted for 80% of the company's revenue, says Connie Dotson, chief communications and knowledge officer at E-Trade.
By adding more products, president and chief operating officer Mitch Caplan says, E-trade will be able to cross-sell to customers and offer one-stop online and in-person financial services.