TheBlaze's Becket Adams contributed to this report.
General Electric, Co. has been quietly informing gun shop owners that the company will no longer be providing lending services to them, the Wall Street Journal reports. GE Capital is apparently reconsidering its relationship to firearms companies following the Sandy Hook shooting.
Earlier this month, Glenn Duncan, owner of Duncan's Outdoor Store in Bay City, Mich., claims he received a letter from GE Capital Retail Bank announcing its "difficult decision" to stop providing financial services to his business. Other gun shops have received similar notices, the Journal notes.
More from WSJ.com:
GE is at least the second big financial firm to retreat from the gun business following the school shootings, which claimed the lives of 20 first-graders and six adults in December.
Days after the killings, private-equity firm Cerberus Capital Management LP said it would try to sell the gun company it owns--Freedom Group Inc.-- which makes brands including Remington, Bushmaster, Marlin and H&R.
GE is based in Fairfield, Conn., and many of the GE's employees live around Newtown, and several have children in the Sandy Hook elementary school, where the shootings took place. Peter Lanza, the father of Sandy Hook gunman Adam Lanza, is an executive at GE Capital. GE Chief Executive Jeff Immelt held a town hall meeting with affected employees after the shooting, and the board has been updated on efforts to help staff, a person familiar with the matter said.
A spokeswoman for Wells Fargo & Co. said bank officials decided to exit gun financing nearly a decade ago. Bank of America Corp., which got out of the business in 2008, didn't respond to requests for comment. A spokeswoman for Citigroup Inc. said the bank doesn't finance loans for firearms.
GE Capital spokesman Russell Wilkerson said the company's policy changes are the result of "industry changes, new legislation and tragical events."
The U.S. gun market brought in about $11.7 billion in sales last year, according to IBIS World. Additionally, financing is merely a "marginal activity" in the industry so GE's actions shouldn't have a huge impact on the gun market, WSJ.com reports.
But that's not to say gun shops won't feel it as more large banks refuse to provide lending services.
"Your options are very limited by being in our business," said Rex McClanahan, co-owner of Buds Gun Shop in Lexington, Ky.
"Smaller lenders have helped fill the gap. Last July, Randy Frazier opened a new division of his direct-marketing business called Gun Financing, promising on its website to arrange loans for 'hottest firearms.' Mr. Frazier said his audience is young men with spotty credit seeking high-end rifles and equipment for sport shooting," the Wall Street Journal report adds.
Still, GE's decision carries symbolic weight (which gun control advocates will latch on to) and will no doubt be felt by companies that have come to rely on customers buying more products because of financing.
And although there are a number of things (mostly negative) that can be said about GE's anti-gun decision, let's let Zero Hedge have the last word:
- GE Capital