US securities regulators are investigating General Electric over a hefty charge in its insurance business that contributed to a fourth-quarter loss, the company said today.
The Securities and Exchange Commission is "investigating the process leading to the insurance reserve increase and the fourth quarter charge," GE Chief Financial Officer Jamie Miller told analysts on a conference call.
"We are cooperating fully with the investigation, which is in very early stages."
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The company on January 16 disclosed that it would book USD 6.2 billion in one-time costs after determining the insurance business needed additional reserves following a review with outside counsel.
The news rattled investors, who had thought the new executive leadership team at GE had uncovered major problems amid the much-anticipated November 2017 turnaround plan.
GE reported a fourth-quarter loss of USD 9.8 billion, compared with profits of USD 3.5 billion in the same quarter of the prior year. Results were also hampered by large one- time charges connected to US tax reform and by a weak performance in the power business.
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