<PAGE>
               UNITED STATES SECURITIES AND EXCHANGE COMMISSION
                             WASHINGTON, D.C. 20549

                                  -------------
                                    FORM 10-Q
                                  -------------


       | X |   QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE
                         SECURITIES EXCHANGE ACT OF 1934

                  For the quarterly period ended June 26, 1999

                                       OR

       |   |  TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE
                         SECURITIES EXCHANGE ACT OF 1934

                        For the transition period from ___ to ___

                         ------------------------------
                         Commission file number 0-14804
                         ------------------------------

                     GENERAL ELECTRIC CAPITAL SERVICES, INC.
                    -----------------------------------------
             (Exact name of registrant as specified in its charter)

            DELAWARE                                          06-1109503
(State or other jurisdiction of                           (I.R.S. Employer
incorporation or organization)                          Identification No.)

      260 LONG RIDGE ROAD,
     STAMFORD, CONNECTICUT                                      06927
(Address of principal executive offices)                     (Zip Code)

                                 (203) 357-4000
              (Registrant's telephone number, including area code)

                         ------------------------------

Indicate by check mark whether the registrant (1) has filed all reports required
to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during
the  preceding 12 months (or for such  shorter  period that the  registrant  was
required  to file  such  reports),  and  (2) has  been  subject  to such  filing
requirements for the past 90 days. Yes |X| No | |

At August 9, 1999, 1,012 shares of common  stock with a par value of $1,000 were
outstanding.

REGISTRANT MEETS THE CONDITIONS SET FORTH IN GENERAL INSTRUCTION H(1)(a) AND (b)
OF FORM 10-Q AND IS THEREFORE FILING THIS FORM 10-Q WITH THE REDUCED  DISCLOSURE
FORMAT.


<PAGE>

                                TABLE OF CONTENTS


                                                                   PAGE
                                                                 --------

PART I - FINANCIAL INFORMATION.

Item 1.       Financial Statements ...........................       1

Item 2.       Management's Discussion and Analysis of Results
              of Operations ..................................       6

Exhibit 12.   Computation of Ratio of Earnings to Fixed
              Charges and Computation of Ratio of Earnings
              to Combined Fixed Charges and Preferred Stock
              Dividends ......................................      10


PART II - OTHER INFORMATION.

Item 6.       Exhibits and Reports on Form 8-K ...............      11

Signatures ...................................................      12

Index to Exhibits ............................................      13





<PAGE>

                         PART I - FINANCIAL INFORMATION

ITEM 1. FINANCIAL STATEMENTS.

<TABLE>
<CAPTION>
       GENERAL ELECTRIC CAPITAL SERVICES, INC. AND CONSOLIDATED AFFILIATES

              CONDENSED STATEMENT OF CURRENT AND RETAINED EARNINGS

                                   (Unaudited)

                                                                    THREE MONTHS ENDED       SIX MONTHS ENDED
                                                                   --------------------    --------------------
                                                                   JUNE 26,    JUNE 27,    JUNE 26,    JUNE 27,
(In millions)                                                         1999        1998        1999        1998
                                                                   --------    --------    --------    --------
<S>                                                               <C>         <C>         <C>         <C>
REVENUES
Revenues from services .........................................   $ 11,417    $  9,908    $ 22,160    $ 19,433
Sales of goods .................................................      1,961       1,893       3,601       3,519
                                                                   --------    --------    --------    --------
                                                                     13,378      11,801      25,761      22,952
                                                                   --------    --------    --------    --------
EXPENSES
Interest .......................................................      2,237       2,187       4,350       4,212
Operating and administrative ...................................      3,859       3,221       7,497       6,379
Cost of goods sold .............................................      1,806       1,728       3,317       3,210
Insurance losses and policyholder and annuity benefits .........      2,705       2,400       5,324       4,613
Provision for losses on financing receivables ..................        442         409         821         741
Depreciation and amortization of buildings and equipment
 and equipment on operating leases .............................        823         604       1,508       1,260
Minority interest in net earnings of consolidated affiliates ...         45          33          83          66
                                                                   --------    --------    --------    --------
                                                                     11,917      10,582      22,900      20,481
                                                                   --------    --------    --------    --------

EARNINGS
Earnings before income taxes ...................................      1,461       1,219       2,861       2,471
Provision for income taxes .....................................       (369)       (286)       (737)       (657)
                                                                   --------    --------    --------    --------

NET EARNINGS ...................................................      1,092         933       2,124       1,814
Dividends ......................................................       (409)       (376)       (795)       (879)
Retained earnings at beginning of period .......................     15,721      13,329      15,075      12,951
                                                                   --------    --------    --------    --------
RETAINED EARNINGS AT END OF PERIOD .............................   $ 16,404    $ 13,886    $ 16,404    $ 13,886
                                                                   ========    ========    ========    ========
</TABLE>


See Notes to Condensed, Consolidated Financial Statements.


                                       1
<PAGE>

ITEM 1. FINANCIAL STATEMENTS (Continued).

<TABLE>
<CAPTION>
       GENERAL ELECTRIC CAPITAL SERVICES, INC. AND CONSOLIDATED AFFILIATES

                    CONDENSED STATEMENT OF FINANCIAL POSITION

                                                                                              JUNE    DECEMBER
                                                                                                26,         31,
(In millions)                                                                                 1999        1998
                                                                                           --------    --------
                                                                                         (Unaudited)
<S>                                                                                       <C>         <C>
ASSETS
Cash and equivalents ...................................................................   $  4,142    $  3,342
Investment securities ..................................................................     76,059      78,458
Financing receivables:
  Time sales and loans, net of deferred income .........................................     81,526      77,283
  Investment in financing leases, net of deferred income ...............................     46,696      47,571
                                                                                           --------    --------
                                                                                            128,222     124,854
  Allowance for losses on financing receivables ........................................     (3,376)     (3,288)
                                                                                           --------    --------
    Financing receivables - net ........................................................    124,846     121,566
Other receivables - net ................................................................     30,976      25,973
Inventories ............................................................................        682         744
Equipment on operating leases (at cost), less accumulated amortization of $7,569
 and $7,021 ............................................................................     21,390      20,941
Intangible assets ......................................................................     13,692      13,639
Other assets ...........................................................................     41,451      38,634
                                                                                           --------    --------
      TOTAL ASSETS .....................................................................   $313,238    $303,297
                                                                                           ========    ========

LIABILITIES AND SHARE OWNERS' EQUITY
Short-term borrowings ..................................................................   $119,246    $113,162
Long-term borrowings:
  Senior ...............................................................................     59,211      58,042
  Subordinated .........................................................................        996         996
Insurance liabilities, reserves and annuity benefits ...................................     80,897      77,259
Other liabilities ......................................................................     21,665      21,062
Deferred income taxes ..................................................................      7,868       9,590
                                                                                           --------    --------
      Total liabilities ................................................................    289,883     280,111
                                                                                           --------    --------

Minority interest in equity of consolidated affiliates .................................      4,287       3,459
                                                                                           --------    --------

Accumulated unrealized gains on investment securities - net ............................        487       2,376
Accumulated foreign currency translation adjustments ...................................       (314)       (215)
                                                                                           --------    --------
Accumulated non-owner changes in share owners' equity ..................................        173       2,161
Capital stock ..........................................................................         11          11
Additional paid-in capital .............................................................      2,480       2,480
Retained earnings ......................................................................     16,404      15,075
                                                                                           --------    --------
      Total share owners' equity .......................................................     19,068      19,727
                                                                                           --------    --------
      TOTAL LIABILITIES AND SHARE OWNERS' EQUITY .......................................   $313,238    $303,297
                                                                                           ========    ========
</TABLE>


See Notes to Condensed, Consolidated Financial Statements.


                                       2
<PAGE>

ITEM 1. FINANCIAL STATEMENTS (Continued).

<TABLE>
<CAPTION>
       GENERAL ELECTRIC CAPITAL SERVICES, INC. AND CONSOLIDATED AFFILIATES

                        CONDENSED STATEMENT OF CASH FLOWS

                                   (Unaudited)

                                                                                             SIX MONTHS ENDED
                                                                                           --------------------
                                                                                           JUNE 26,    JUNE 27,
(In millions)                                                                                 1999        1998
                                                                                           --------    --------
<S>                                                                                       <C>         <C>
CASH FLOWS FROM OPERATING ACTIVITIES
Net earnings ...........................................................................   $  2,124    $  1,814
Adjustments to reconcile net earnings to cash provided from operating activities:
  Provision for losses on financing receivables ........................................        821         741
  Depreciation and amortization of buildings and equipment and
   equipment on operating leases .......................................................      1,508       1,260
  Other - net ..........................................................................      2,400       1,074
                                                                                           --------    --------
      Cash from operating activities ...................................................      6,853       4,889
                                                                                           --------    --------

CASH FLOWS FROM INVESTING ACTIVITIES
Increase in loans to customers .........................................................    (40,346)    (30,376)
Principal collections from customers - loans ...........................................     35,456      28,864
Investment in equipment for financing leases ...........................................     (7,949)     (8,867)
Principal collections from customers - financing leases ................................      6,426       7,121
Net change in credit card receivables ..................................................        858        (484)
Buildings and equipment and equipment on operating leases:
    - additions ........................................................................     (4,165)     (3,951)
    - dispositions .....................................................................      3,788       2,959
Payments for principal businesses purchased, net of cash acquired ......................     (5,978)       (993)
Purchases of securities by insurance and annuity businesses ............................    (11,525)    (12,010)
Dispositions and maturities of securities by insurance and annuity businesses ..........     11,236       9,335
Other - net ............................................................................     (2,860)     (3,351)
                                                                                           --------    --------
      Cash used for investing activities ...............................................    (15,059)    (11,753)
                                                                                           --------    --------

CASH FLOWS FROM FINANCING ACTIVITIES
Net change in borrowings (maturities 90 days or less) ..................................      6,212       5,294
Newly issued debt - short-term (maturities 91-365 days) ................................      2,541       2,891
                  - long-term (longer than one year) ...................................     11,855      14,362
Proceeds - non-recourse, leveraged lease debt ..........................................        320         535
Repayments and other reductions:
                  - short-term (maturities 91-365 days) ................................    (10,249)    (13,142)
                  - long-term (longer than one year) ...................................     (1,130)     (3,610)
Principal payments - non-recourse, leveraged lease debt ................................       (228)       (247)
Proceeds from sales of investment contracts ............................................      3,644       2,154
Redemption of investment contracts .....................................................     (3,464)     (2,445)
Dividends paid .........................................................................       (795)       (879)
Issuance of variable cumulative preferred stock by consolidated affiliate ..............        300          70
                                                                                           --------    --------
      Cash from financing activities ...................................................      9,006       4,983
                                                                                           --------    --------

INCREASE (DECREASE) IN CASH AND EQUIVALENTS ............................................        800      (1,881)
CASH AND EQUIVALENTS AT BEGINNING OF PERIOD ............................................      3,342       4,904
                                                                                           --------    --------
CASH AND EQUIVALENTS AT END OF PERIOD ..................................................   $  4,142    $  3,023
                                                                                           ========    ========
</TABLE>


See Notes to Condensed, Consolidated Financial Statements.


                                       3
<PAGE>

ITEM 1. FINANCIAL STATEMENTS (Continued).

       GENERAL ELECTRIC CAPITAL SERVICES, INC. AND CONSOLIDATED AFFILIATES

              NOTES TO CONDENSED, CONSOLIDATED FINANCIAL STATEMENTS
                                   (UNAUDITED)


1.        The accompanying  condensed quarterly financial  statements  represent
          the adding together of General Electric Capital Services, Inc. and all
          majority-owned  and controlled  affiliates  (collectively  called "the
          Corporation" or "GECS"). All significant transactions among the parent
          and consolidated affiliates have been eliminated. Certain prior period
          data  have  been   reclassified  to  conform  to  the  current  period
          presentation.

2.        The  condensed   consolidated   quarterly  financial   statements  are
          unaudited.  These  statements  include all adjustments  (consisting of
          normal  recurring  accruals)  considered  necessary by  management  to
          present a fair  statement  of the  results  of  operations,  financial
          position  and cash  flows.  The results  reported  in these  condensed
          consolidated   financial   statements   should  not  be   regarded  as
          necessarily  indicative of results that may be expected for the entire
          year.

3.        In June 1998, the Financial Accounting Standards Board ("FASB") issued
          Statement of Financial  Accounting  Standards No. 133,  Accounting for
          Derivative  Instruments and Hedging Activities (the "Statement").  The
          Statement  requires that,  upon adoption,  all derivative  instruments
          (including certain derivative instruments embedded in other contracts)
          be recognized in the balance sheet at fair value,  and that changes in
          such fair values be recognized  in earnings  unless  specific  hedging
          criteria are met. Changes in the values of derivatives that meet these
          hedging  criteria will ultimately  offset related  earnings effects of
          the  hedged  items;  effects  of  certain  changes  in fair  value are
          recorded in equity pending recognition in earnings.  In June 1999, the
          FASB  delayed  the  required  effective  date of the new  standard  to
          January 1, 2001.  The impact of adoption will be determined by several
          factors, including the specific hedging instruments in place and their
          relationships   to  hedged  items,  as  well  as  market   conditions.
          Management  has not  estimated  the effect of  adoption as it believes
          that such  determination  will not be  meaningful  until closer to the
          adoption date.

4.        A summary  of  changes  in share  owner's  equity  that do not  result
          directly from transactions with share owners is provided below.

<TABLE>
<CAPTION>
                                                            THREE MONTHS ENDED
                                                           --------------------
                                                           JUNE 26,    JUNE 27,
(In millions)                                                 1999        1998
                                                           --------    --------
<S>                                                        <C>         <C>
Net earnings ...........................................   $  1,092    $    933
Unrealized gains (losses) on investment securities - net     (1,445)        163
Foreign currency translation adjustments ...............        (27)          5
                                                           --------    --------
Total ..................................................   $   (380)   $  1,101
                                                           ========    ========


                                                             SIX MONTHS ENDED
                                                           --------------------
                                                           JUNE 26,    JUNE 27,
                                                              1999        1998
                                                           --------    --------
Net earnings ...........................................   $  2,124    $  1,814
Unrealized gains (losses) on investment securities - net     (1,889)        424
Foreign currency translation adjustments ...............        (99)        (37)
                                                           --------    --------
Total ..................................................   $    136    $  2,201
                                                           ========    ========
</TABLE>


                                       4
<PAGE>

ITEM 1. FINANCIAL STATEMENTS (Continued).

5.        Revenues and net earnings of the  Corporation,  by operating  segment,
          for the three  months and six months  ended June 26, 1999 and June 27,
          1998 were as follows:

<TABLE>
<CAPTION>
                                    THREE MONTHS ENDED       SIX MONTHS ENDED
                                   --------------------    --------------------
                                   JUNE 26,    JUNE 27,    JUNE 26,    JUNE 27,
(In millions)                         1999        1998        1999        1998
                                   --------    --------    --------    --------
<S>                               <C>         <C>         <C>         <C>
REVENUES
Consumer Services ..............   $  4,064    $  3,756    $  8,079    $  7,476
Equipment Management ...........      4,072       3,705       7,615       7,008
Mid-Market Financing ...........      1,141         834       2,155       1,642
Specialized Financing ..........      1,012         773       1,812       1,524
Specialty Insurance ............      3,058       2,675       6,036       5,106
All other ......................         31          58          64         196
                                   --------    --------    --------    --------
Total revenues .................   $ 13,378    $ 11,801    $ 25,761    $ 22,952
                                   ========    ========    ========    ========

NET EARNINGS
Consumer Services ..............   $    212    $    147    $    423    $    301
Equipment Management ...........        224         177         434         347
Mid-Market Financing ...........        130          95         246         198
Specialized Financing ..........        283         230         478         408
Specialty Insurance ............        323         313         683         622
All other ......................        (80)        (29)       (140)        (62)
                                   --------    --------    --------    --------
Total net earnings .............   $  1,092    $    933    $  2,124    $  1,814
                                   ========    ========    ========    ========
</TABLE>

6.        Subsequent  Event - On July  22,  1999,  the  Corporation's  Board  of
          Directors  approved the amendment of the Corporation's  certificate of
          incorporation  to effect a 10-for-1  stock split and to  increase  the
          authorized  common  shares  from  1,010  to  1,260  (calculated  on  a
          post-split basis). The amendment became effective on July 22, 1999.




                                       5
<PAGE>

ITEM  2.  MANAGEMENT'S DISCUSSION AND ANALYSIS OF RESULTS OF OPERATIONS.

OVERVIEW

Net  earnings  for the first half of 1999 were $2,124  million,  a $310  million
(17%)  increase  over  the  first  half  of  1998.  The  results  reflected  the
globalization  and  diversity of the  Corporation's  businesses  and were led by
double-digit increases in each of its five segments. The improvement in earnings
was largely  attributable to the effects of continued asset growth,  principally
from  acquisitions of businesses and portfolios and higher  origination  volume,
and a higher level of asset gains.

OPERATING RESULTS

TOTAL  REVENUES  from all  sources  increased  $2,809  million  (12%) to $25,761
million for the first half of 1999,  compared with $22,952 million for the first
half of  1998.  This  increase  was  led by  acquisition-related  growth  in the
Mid-Market Financing segment and a combination of core and acquisition growth in
the Consumer Services, Specialty Insurance and Equipment Management segments.

INTEREST  EXPENSE for the first half of 1999 was $4,350 million,  3% higher than
for the first half of 1998. The increase reflected the effects of higher average
borrowings  used to finance  asset  growth,  partially  offset by the effects of
lower average interest rates. The composite  interest rate on the  Corporation's
borrowings for the first half of 1999 was 5.22% compared with 6.13% in the first
half of 1998.

OPERATING AND ADMINISTRATIVE  EXPENSES were $7,497 million for the first half of
1999,  an 18%  increase  over the first  half of 1998.  The  increase  primarily
reflected costs associated with businesses and portfolios acquired over the past
year, higher investment levels and increases in insurance  commissions and other
costs that vary directly with increased revenues.

COST OF GOODS SOLD is associated with activities of the  Corporation's  computer
equipment distribution businesses.  This cost amounted to $3,317 million for the
first half of 1999, compared with $3,210 million for the first half of 1998. The
increase  primarily  reflected  increased  volume  partially  offset by  reduced
product costs.

INSURANCE LOSSES AND POLICYHOLDER AND ANNUITY BENEFITS increased $711 million to
$5,324 million for the first half of 1999, compared with the first half of 1998.
The increase primarily reflected the effects of business acquisitions and growth
in premium volume  throughout  the period,  and to a lesser extent a higher loss
ratio caused by an increase in property  incurred  losses,  partially  offset by
improved market conditions in the mortgage insurance business.

PROVISION FOR LOSSES ON FINANCING  RECEIVABLES increased to $821 million for the
first  half of  1999  from  $741  million  for the  first  half of  1998.  These
provisions  principally  related to credit cards,  personal loans and auto loans
and auto leases in the Consumer  Services  segment,  which are  discussed  below
under Portfolio Quality.

DEPRECIATION  AND  AMORTIZATION  OF BUILDINGS  AND  EQUIPMENT  AND  EQUIPMENT ON
OPERATING  LEASES increased $248 million to $1,508 million for the first half of
1999 compared with $1,260  million for the first half of 1998.  The increase was
principally  the  result of higher  levels of  equipment  on  operating  leases,
primarily reflecting acquisition growth.

PROVISION  FOR  INCOME  TAXES was $737  million  for the first  half of 1999 (an
effective  tax rate of 25.8%),  compared with $657 million for the first half of
1998 (an  effective  tax rate of 26.6%).  The higher  provision for income taxes
primarily  reflected  increased  pre-tax  earnings  subject to  statutory  rates
partially  offset by the lower  effective tax rate caused by decreased  taxes on
non-U.S. earnings.


                                       6
<PAGE>

ITEM  2.  MANAGEMENT'S DISCUSSION AND ANALYSIS OF RESULTS
          OF OPERATIONS (Continued).

OPERATING SEGMENTS

Revenues and net earnings of the Corporation,  by operating segment, for the six
months ended June 26, 1999 and June 27, 1998 are summarized and discussed below.

<TABLE>
<CAPTION>
                                                             SIX MONTHS ENDED
                                                           --------------------
                                                           JUNE 26,    JUNE 27,
(In millions)                                                 1999        1998
                                                           --------    --------
<S>                                                       <C>         <C>
REVENUES
Consumer Services ......................................   $  8,079    $  7,476
Equipment Management ...................................      7,615       7,008
Mid-Market Financing ...................................      2,155       1,642
Specialized Financing ..................................      1,812       1,524
Specialty Insurance ....................................      6,036       5,106
All other ..............................................         64         196
                                                           --------    --------
Total revenues .........................................   $ 25,761    $ 22,952
                                                           ========    ========

NET EARNINGS
Consumer Services ......................................   $    423    $    301
Equipment Management ...................................        434         347
Mid-Market Financing ...................................        246         198
Specialized Financing ..................................        478         408
Specialty Insurance ....................................        683         622
All other ..............................................       (140)        (62)
                                                           --------    --------
Total net earnings .....................................   $  2,124    $  1,814
                                                           ========    ========
</TABLE>

Consumer Services revenues  increased 8% and net earnings  increased 40% for the
first half of 1999, compared to the first half of 1998. The increase in revenues
was led by acquisition-related and core growth at Global Consumer Finance and GE
Financial Assurance,  the Corporation's consumer savings and insurance business,
partially  offset by the effects of planned asset  reductions  in U.S.  consumer
credit card and automobile  financing  activities.  The increase in net earnings
was led by a  combination  of  acquisition-related  and core  growth  at  Global
Consumer Finance.

Equipment  Management  revenues  grew 9% and net earnings grew 25% for the first
half of 1999,  compared to the  corresponding  period in 1998.  The  increase in
revenues  was  primarily   attributable  to  increased   volume  at  Information
Technology  Solutions,  acquisition-related  growth in fleet  services and asset
gains and core growth in aviation services. The increase in net earnings was led
by asset gains.

Mid-Market  Financing  revenues grew 31% and net earnings  increased 24% for the
first half of 1999, compared to the corresponding period in 1998, primarily as a
result of acquisition growth.

Specialized  Financing  revenues rose 19% and net earnings  increased 17% in the
first  half of 1999,  compared  to the  first  half of 1998.  The  increases  in
revenues  and net  earnings  principally  reflected  asset growth as well as the
effects of asset gains, including securitizations.


                                       7
<PAGE>

ITEM  2.  MANAGEMENT'S DISCUSSION AND ANALYSIS OF RESULTS
          OF OPERATIONS (Continued).

Specialty  Insurance  revenues  grew 18% and net earnings  grew 10% in the first
half of 1999,  compared to the  corresponding  period in 1998.  These  increases
resulted  from  increased   premium  and  investment   income   associated  with
acquisitions,   origination  volume  and  continued  growth  in  the  investment
portfolios,  as  well  as  a  higher  level  of  realized  gains  on  investment
securities.  Net earnings were also favorably affected by improved conditions in
the mortgage insurance business,  the result of improvements in loss experience,
partially  offset by increased  frequency and severity of property losses in the
reinsurance business.

PORTFOLIO QUALITY

FINANCING  RECEIVABLES  are the  financing  businesses  largest  asset and their
primary  source of revenues.  The  portfolio of  financing  receivables,  before
allowance for losses,  increased to $128.2 billion at June 26, 1999, from $124.9
billion  at the  end  of  1998,  primarily  reflecting  the  effects  of  higher
origination volume and acquisition growth,  partially offset by foreign currency
translation on European financing receivables. The related allowances for losses
at June 26, 1999 amounted to $3.4 billion ($3.3 billion at the end of 1998) and,
in  management's  judgment,  are  appropriate  given  the  risk  profile  of the
portfolio.  A discussion  about the quality of certain elements of the portfolio
of financing receivables follows. "Nonearning" receivables are those that are 90
days or more delinquent (or for which  collection has otherwise become doubtful)
and  "reduced-earning"  receivables are commercial  receivables whose terms have
been  restructured  to a  below-market  yield.  The following  discussion of the
nonearning  and  reduced-earning   receivable  balances  and  write-off  amounts
excludes amounts related to Montgomery Ward Holding Corp. and affiliates,  which
are separately discussed below.

CONSUMER  FINANCING  RECEIVABLES,  primarily  credit card and personal loans and
auto loans and leases,  were $51.7 billion at June 26, 1999, an increase of $0.1
billion from the end of 1998.  Nonearning  receivables were $1.1 billion at June
26, 1999,  2.1% of total  consumer  financing  receivables,  compared  with $1.3
billion, 2.4% of total consumer receivables, at December 31, 1998. Write-offs of
consumer  receivables  decreased  to $481  million  for the first  half of 1999,
compared  with  $714  million  for the first  half of 1998.  This  decrease  was
primarily  attributable to the effects of lower  delinquencies  during the first
half of  1999  as well as the  effects  of  lower  average  receivable  balances
resulting from securitization and other sales of portfolios.

OTHER  FINANCING  RECEIVABLES,  totaling  $76.5  billion at June 26, 1999 ($73.3
billion at December 31, 1998), consisted of a diverse commercial, industrial and
equipment  loan and lease  portfolio.  Related  nonearning  and  reduced-earning
receivables  were less than 1% of total other financing  receivables at June 26,
1999 and December 31, 1998.

As discussed in the Corporation's  Annual Report on Form 10-K for the year ended
December 31, 1998,  Montgomery  Ward Holding Corp.  ("MWHC")  filed a bankruptcy
petition for  reorganization in 1997. The Corporation's  recorded  investment in
MWHC and  affiliates  at June 26, 1999 was $565 million ($622 million at the end
of 1998). Subsequent to the filing of the petition, the Corporation committed to
provide MWHC up to $1.0 billion in debtor-in-possession financing, a majority of
which has been syndicated:  the Corporation's  loans under this facility at June
26,  1999  were  approximately  $226  million.  The  Corporation  also  provides
revolving  credit card financing  directly to customers of MWHC and  affiliates;
such receivables  totaled $2.8 billion at June 26, 1999,  including $1.6 billion
that have been sold with recourse.  The obligations of customers with respect to
these  receivables are not affected by the bankruptcy filing. On August 2, 1999,
MWHC emerged from bankruptcy under a plan of reorganization that was approved on
July 15,  1999.  As part of the  restructuring,  the  Corporation  acquired  The
Signature  Group,  which  was not in  bankruptcy,  as well as the  equity of the
reorganized retailer.

The Corporation held loans and leases to commercial  airlines amounting to $10.7
billion at June 26, 1999, up from $10.2 billion at the end of 1998.


                                       8
<PAGE>

ITEM  2.  MANAGEMENT'S DISCUSSION AND ANALYSIS OF RESULTS
          OF OPERATIONS (CONTINUED).

OTHER MATTERS

YEAR 2000

As discussed in the Corporation's  Annual Report on Form 10-K for the year ended
December 31, 1998, the  Corporation is applying a Six Sigma quality  approach to
identify and mitigate Year 2000 issues in its information systems,  products and
services,  facilities  and  suppliers,  as well as to assess the extent to which
Year 2000 issues will affect its customers. Each business has a Year 2000 leader
who oversees a  multi-functional  project team  responsible  for remediation and
contingency planning,  applying a Six Sigma quality approach in four phases: (1)
define/measure- identify and inventory possible sources of Year 2000 issues; (2)
analyze- determine the nature and extent of Year 2000 issues and develop project
plans to address those issues;  (3) improve- execute project plans and perform a
majority of the testing; and (4) control- complete testing,  continue monitoring
readiness and complete necessary  contingency plans. As of the end of June 1999,
virtually  all   significant   information   systems,   products  and  services,
facilities,  and  suppliers  were in the control  phase.  As a final step in the
control  phase,   the  Corporation  is  developing,   testing  and  implementing
contingency plans to ameliorate any potential internal or external disruption of
critical business processes. The specific actions identified in such contingency
plans  differ  depending  on  circumstances,   but  most  often  include  manual
work-arounds,  deployment of backup or secondary technologies,  rearranging work
schedules, and substitution of suppliers, as appropriate.  While the Corporation
does not expect significant disruptions of critical business processes caused by
internal Year 2000 issues, the likelihood of  externally-caused  disruptions and
the  ability of the  contingency  plans to  ameliorate  the  effects of any such
externally-caused  disruptions is not  determinable.  The total estimate of Year
2000 expenditures,  adjusted for increases related to acquired companies,  is in
line with  previous  projections.  The  activities  related to Year 2000 efforts
necessarily  involve  estimates and projections of activities and resources that
will be required in the future.  These estimates and projections could change as
work progresses.


                                       9
<PAGE>


                                                                     EXHIBIT 12

<TABLE>
<CAPTION>
       GENERAL ELECTRIC CAPITAL SERVICES, INC. AND CONSOLIDATED AFFILIATES

                COMPUTATION OF RATIO OF EARNINGS TO FIXED CHARGES
                                       AND
           COMPUTATION OF RATIO OF EARNINGS TO COMBINED FIXED CHARGES
                          AND PREFERRED STOCK DIVIDENDS

                         SIX MONTHS ENDED JUNE 26, 1999
                                   (Unaudited)

                                                                       RATIO OF
                                                                       EARNINGS
                                                                          TO
                                                                       COMBINED
                                                                         FIXED
                                                           RATIO OF     CHARGES
                                                           EARNINGS       AND
                                                              TO      PREFERRED
                                                             FIXED       STOCK
(Dollar amounts in millions)                                CHARGES   DIVIDENDS
                                                           --------    --------
<S>                                                        <C>         <C>
Net earnings ...........................................   $  2,124    $  2,124
Provision for income taxes .............................        737         737
Minority interest in net earnings of consolidated
 affiliates ............................................         83          83
                                                           --------    --------
Earnings before provision for income taxes and
 minority interest .....................................      2,944       2,944
                                                           --------    --------
Fixed charges:
  Interest .............................................      4,461       4,461
  One-third of rentals .................................        171         171
                                                           --------    --------
Total fixed charges ....................................      4,632       4,632
                                                           --------    --------
Less interest capitalized, net of amortization .........         48          48
                                                           --------    --------
Earnings before provision for income taxes and
 minority interest, plus fixed charges .................   $  7,528    $  7,528
                                                           ========    ========

Ratio of earnings to fixed charges .....................       1.63
                                                           ========


Preferred stock dividend requirements ..................               $   --
Ratio of earnings before provision for income taxes to
 net earnings ..........................................                   1.35
Preferred stock dividend factor on pre-tax basis .......                   --
Fixed charges ..........................................                  4,632
                                                                       --------
Total fixed charges and preferred stock dividend
 requirements ..........................................               $  4,632
                                                                       ========
Ratio of earnings to combined fixed charges and
 preferred stock dividends .............................                   1.63
                                                                       ========
</TABLE>


For purposes of computing the ratios,  fixed charges  consist of interest on all
indebtedness and one-third of rentals, which management believes is a reasonable
approximation of the interest factor of such rentals.


                                       10
<PAGE>

                           PART II--OTHER INFORMATION

ITEM 6. EXHIBITS AND REPORTS ON FORM 8-K.

     a. EXHIBITS.

        Exhibit 3(i). A complete  copy  of  the  Certificate  of   Incorporation
                      of the  Corporation  as last  amended on July 22, 1999 and
                      currently in effect,  consisting of the following: (a) the
                      Certificate  of  Incorporation  of the  Corporation  as in
                      effect immediately prior to the filing of a Certificate of
                      Amendment on July 22, 1999  (incorporated  by reference to
                      Exhibit 3(i) of the Corporation's Form 10-K Report for the
                      year ended  December 31, 1993);  and (b) a Certificate  of
                      Amendment filed with the Office of the Secretary of State,
                      State of Delaware on July 22, 1999.

        Exhibit 12.   Computation  of  ratio  of  earnings to  fixed charges and
                      computation of ratio of earnings to combined fixed charges
                      and preferred stock dividends.

        Exhibit 27.   Financial Data Schedule (filed electronically only).


     b. REPORTS ON FORM 8-K.

        None.



                                       11
<PAGE>

                                   SIGNATURES

Pursuant  to the  requirements  of the  Securities  Exchange  Act of  1934,  the
registrant  has duly  caused  this  report  to be  signed  on its  behalf by the
undersigned thereunto duly authorized.


                                   GENERAL ELECTRIC CAPITAL SERVICES, INC.
                                   ---------------------------------------
                                                 (Registrant)


Date: August 10, 1999              By:         /s/ J.A. Parke
                                       -----------------------------------
                                                   J.A. Parke,
                                           Executive Vice President
                                          and Chief Financial Officer
                                         (Principal Financial Officer)


Date: August 10, 1999              By:         /s/ J.C. Amble
                                       -----------------------------------
                                                   J.C. Amble,
                                          Vice President and Controller
                                          (Principal Accounting Officer)




                                       12
<PAGE>

       GENERAL ELECTRIC CAPITAL SERVICES, INC. AND CONSOLIDATED AFFILIATES

                                INDEX TO EXHIBITS

EXHIBIT NO.                                                            PAGE
-----------                                                          --------

   3(i)      A complete copy of  the Certificate of  Incorporation
             of the Corporation as  last amended on  July 22, 1999
             and currently in effect, consisting of the following:
             (a)   the   Certificate  of   Incorporation  of   the
             Corporation  as in effect  immediately  prior  to the
             filing of a Certificate of Amendment on July 22, 1999
             (incorporated  by reference to Exhibit  3(i)  of  the
             Corporation's   Form  10-K  Report for the year ended
             December  31, 1993) ;  and  (b)  a   Certificate   of
             Amendment  filed with the Office of the  Secretary of
             State,  State of Delaware on July 22, 1999. .........       14


   12        Computation of ratio of earnings to fixed charges and
             computation of  ratio  of earnings  to combined fixed
             charges and preferred stock dividends ...............       16


   27        Financial Data Schedule (filed electronically only)



                                       13