UNITED STATES SECURITIES AND EXCHANGE COMMISSION

WASHINGTON, D.C. 20549

****Form10-K**þ**Annual Report Pursuant to Section 13 or 15(d) of the    Securities Exchange Act of 1934**For the fiscal year ended December 31, 2003**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 charter)**Delaware **06-1109503**** ****
(State or other jurisdiction of incorporation or    organization) 
(I.R.S. Employer Identification No.)
   **260 Long Ridge Road, Stamford, Connecticut **06927 **203/357-4000**** **** ****
(Address of principal executive offices) 
(Zip Code) 
(Telephone No.)  **      Securities Registered Pursuant to Section 12(b) of the Act: **Title of each class **Name of each exchange    on which registered **7 1/2% Guaranteed Subordinated Notes Due August 21, 2035 **New York Stock Exchange**SECURITIES REGISTERED PURSUANT    TO SECTION 12(g) OF THE ACT:**Title of each class**Common Stock, par value $1,000 per share
Indicate by check mark whether the registrant (1) has filed allreports required to be filed by Section 13 or 15(d) of the Securities ExchangeAct of 1934 during the preceding 12 months (or for such shorter period that theregistrant was required to file such reports), and (2) has been subject to suchfiling requirements for the past 90 days. Yes þ No ̈

Indicate by check mark if disclosure of delinquent filerspursuant to Item 405 of Regulation S-K is not contained herein, and will not becontained, to the best of registrant's knowledge, in definitive proxy orinformation statements incorporated by reference in Part III of this Form 10-Kor any amendment to this Form 10-K. þ

Indicate by check mark whether the registrant is an acceleratedfiler (as defined in Exchange Act Rule 12b-2). Yes  ̈No þ

Aggregate market value of the outstanding common equity held bynonaffiliates of the registrant as of the last business day of the registrant'smost recently completed second fiscal quarter:  None.

At February 27, 2004, 1,064 shares of voting common stock, whichconstitute all of the outstanding common equity, with a par value of $1,000 wereoutstanding.
**DOCUMENTS INCORPORATED BY REFERENCE**
The consolidated financial statements of General ElectricCompany, set forth in the Annual Report on Form 10-K of General Electric Companyfor the year ended December 31, 2003 are incorporated by reference into Part IVhereof.

Item 1. Business – Property and Casualty Reserves for UnpaidClaims and Claim Expenses, set forth in the Annual Report on Form 10-K of GEGlobal Insurance Holding Corporation for the year ended December 31, 2003 isincorporated by reference into Part I hereof.
**REGISTRANT MEETS THE CONDITIONS SET FORTH IN GENERAL INSTRUCTIONI(1)(a) AND (b) OF FORM 10-K AND IS THEREFORE FILING THIS FORM 10-K WITH THEREDUCED DISCLOSURE FORMAT.

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Table of Contents

 ****TABLE OF CONTENTS 
 
Page**PART I
 
 
Item 1. Business
3
Item 2. Properties
11
Item 3. Legal    Proceedings
11
Item 4. Submission of    Matters to a Vote of Security Holders
12
 
 **PART II
 
 
 
Item 5. Market for    the Registrant's Common Equity and Related Stockholder Matters
12
Item 6. Selected    Financial Data
12
Item 7. Management's    Discussion and Analysis of Results of Operations
13
Item 7A.    Quantitative and Qualitative Disclosures About Market Risk
39
Item 8. Financial    Statements and Supplementary Data
40
Item 9. Changes in    and Disagreements with Accountants on Accounting and Financial Disclosure
87
Item 9A. Controls and Procedures
87
 
 **PART III
 
 
 
Item 10. Directors    and Executive Officers of the Registrant
87
Item 11. Executive    Compensation
88
Item 12. Security    Ownership of Certain Beneficial Owners and Management
88
Item 13. Certain    Relationships and Related Transactions
88
Item 14. Principal Accountant Fees and    Services
88
 
 **PART IV
 
 
 
Item 15. Exhibits,    Financial Statement Schedules, and Reports on Form 8-K
89
Signatures 
98
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**PART I

Item 1. Business.

GENERAL ELECTRIC CAPITAL SERVICES, INC.**
General Electric Capital Services, Inc. (GECS) was incorporatedin 1984 in Delaware. All of our outstanding common stock is owned, directly orindirectly, by General Electric Company (GE Company or GE). Our two principalsubsidiaries conduct most of GE Company's financial services operations. Thosesubsidiaries, which we wholly own, are General Electric Capital Corporation (GECapital or GECC) and GE Global Insurance Holding Corporation (GE GlobalInsurance Holding), the parent of Employers Reinsurance Corporation (ERC). 

     Our principal executive offices are at 260 Long Ridge Road,Stamford, Connecticut 06927 (Telephone number (203) 357-4000). At December 31,2003, our employment totaled approximately 87,000.

     Our financial information, including filings with the U. S.Securities and Exchange Commission (SEC), is available at www.ge.com/en/company/investor/secfilings.htm.Copies are also available, without charge, from GE Corporate InvestorCommunications, 3135 Easton Turnpike, Fairfield, CT, 06828-0001. Alternatively,reports filed with the SEC may be viewed or obtained at the SEC Public ReferenceRoom in Washington, D.C., or at www.sec.gov.
**GENERAL ELECTRIC CAPITAL CORPORATION**
GE Capital was incorporated in 1943 as successor to a 1932company in the State of New York under the provisions of the New York BankingLaw relating to investment companies. GE Company contributed all of GE Capital'sstock to us in June 1984 upon its formation. On July 2, 2001, GE Capital changedits state of incorporation to Delaware. Financing and services offered by GECapital are diversified, a significant change from the original business of GECapital, that is, financing distribution and sale of consumer and other GECompany products. GE Company manufactures few of the products financed by GECapital.

     GE Capital operates in four key operating segmentsdescribed below. These operations are subject to a variety of regulations intheir respective jurisdictions.

     Services of GE Capital are offered primarily in the UnitedStates, Canada, Europe and the Pacific Basin. GE Capital's principal executiveoffices are at 260 Long Ridge Road, Stamford, Connecticut 06927-1600. AtDecember 31, 2003, GE Capital employment totaled approximately 83,700.
**GE GLOBAL INSURANCE HOLDING CORPORATION**
GE Global Insurance Holding, together with its affiliates,operates in the Insurance segment described below and its operations areregulated by insurance and other regulators.

     GE Global Insurance Holding and its affiliates conductbusiness throughout the world using a network of local offices. GE GlobalInsurance Holding's principal executive offices are at 5200 Metcalf Avenue,Overland Park, Kansas 66201-1391. At December 31, 2003, GE Global InsuranceHolding's employment totaled approximately 3,300. 

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**OPERATING SEGMENTS**
Refer to Item 7, "Management's Discussion and Analysis ofResults of Operations," in this Annual Report on Form 10-K for a discussion ofour principal businesses by operating segment. Item 1. Business - Property andCasualty Reserves for Unpaid Claims and Claim Expenses, which is set forth inthe Annual Report on Form 10-K of GE Global Insurance Holding for the year endedDecember 31, 2003, is incorporated herein by reference.
**COMMERCIAL FINANCE**
Commercial Finance (29.4%, 30.3% and 26.8% of total revenue in2003, 2002 and 2001, respectively) offers an array of financial servicesworldwide. With particular expertise in the mid-market segment, we offer loans,leases, and other financial services to customers, including manufacturers,distributors and end-users for a variety of equipment and major capital assetsincluding industrial facilities and equipment, energy-related facilities,commercial and residential real estate, vehicles, aircraft, and equipment usedin construction, manufacturing, data processing and office applications,electronics and telecommunications, and healthcare. As further discussed on page18, we acquired the commercial inventory financing business of DeutscheFinancial Services and the structured finance business of ABB in 2002, and asdiscussed in note 23, most of the commercial lending business of TransamericaFinance Corporation in January 2004.

     We operate in a highly competitive environment and aresubject to competition from a variety of financial institutions includingcommercial banks, investment banks, leasing companies, financing companiesassociated with manufacturers, and independent finance companies. Industryparticipants compete on the basis of interest rates and fees as well as dealstructures and credit terms. Profitability is affected not only by broadeconomic conditions that impact customer credit quality and the availability andcost of capital, but also by successful management of credit risk, operatingrisk and market risks such as interest rate and currency exchange risk.Important factors to continued success include maintaining strong riskmanagement systems, customer and industry specific knowledge, diverseportfolios, service and distribution channels, strong collateral and assetmanagement knowledge, deal structuring expertise and the reduction of coststhrough technology and productivity.

     Our headquarters are located in Stamford, Connecticut withoffices throughout the United States and in Canada, Latin America, Europe, andAsia Pacific.

     Our activities are conducted through the principalbusinesses described below. For further information about revenues, netearnings, and assets for these businesses, see page 17.
*Real Estate*
Real Estate funds the direct acquisition, refinancing andrenovation of real estate assets, and purchases equity investments in realestate properties. Real Estate loans generally are intermediate-term senior andsubordinated fixed and floating-rate and are secured by existingincome-producing commercial properties. Our business also includes theorigination and term securitization within one year of low loan to value loans.We invest in and provide restructuring financing for portfolios of real estate,mortgage loans, limited partnerships and tax-exempt bonds. Additionally, weinvest in equity positions in a diversified portfolio of real estate assets viadirect real estate ownership and joint venture interests. Property types includemulti-family housing, self-storage facilities, warehouses, parking facilities,retail centers, senior assisted living facilities and office properties.

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*Aviation Services*
Aviation Services is a global commercial aviation financialservices business that offers a broad range of financial products to airlines,aircraft operators, owners, lenders and investors. Financial products includeleases, aircraft purchasing and trading, loans, engine/spare parts financing,pilot training, fleet planning and financial advisory services.

     Commercial aviation is an industry in which we have asignificant ongoing interest. As has been widely reported, this industry hasbeen under pressure, but has undertaken steps to reduce unused capacity andalign costs. Consequently, during 2003, major United States and Europeanairlines achieved moderate improvements in operations including traffic,revenues and load factors. Aviation Services, which owned 1,239 commercialaircraft at December 31, 2003, had 1,236 on lease despite pressure on theindustry. Regional jets, with capacity for 50-90 passengers, have had asignificant effect on the commercial aviation industry in recent years. Thesejets have enabled airlines to replace less efficient equipment, both turbopropand older, narrow-bodied jets. At December 31, 2003, the Aviation Services fleetincluded 278 regional jets, diversifying total aircraft holdings. AviationServices believes that it continues to offer a suitable range of equipment thatis attractive to the industry. See page 35 for further discussion of the risksand exposure to the Commercial Aviation industry.
*Commercial Equipment Financing*
Commercial Equipment Financing finances manufacturing equipment,facilities, construction and office equipment, corporate aircraft, franchises,trucks and trailers and a wide variety of other equipment. We also furnishcustomers with direct-source tax-exempt finance programs, as well as lease andsale/leaseback offerings. Customers include manufacturers, distributors,dealers, end-users, and municipalities. We also maintain an asset managementoperation that redeploys off lease and repossessed equipment and other assets.
*Corporate Financial Services*
Corporate Financial Services provides equity, revolving and termdebt used by customers to finance acquisitions, business expansion, refinancings,recapitalizations and other special situations. Customers are owners, managersand buyers of both public and private companies, principally manufacturers,distributors, retailers and diversified service providers. Our industryspecialists concentrate on the retail, and media and communications industries.We also provide senior debt, subordinated debt and bridge financing to buyoutand private equity firms.
*Structured Finance*
Structured Finance provides equity, debt and structuredinvestments to its customers, primarily in the global energy,telecommunications, industrial and transportation sectors. Financial servicesand products include corporate finance, acquisition finance and project finance.Products include a variety of debt and equity instruments, as well as structuredtransactions, including leases and partnerships. 
*Vendor Financial Services*
Vendor Financial Services provides financial services toequipment manufacturers and dealers/distributors in a variety of industriesincluding office equipment, industrial equipment, information technologyequipment, motor sports and marine equipment, recreational vehicles andtelecommunications equipment. We offer distribution financing programs, salesfinancing and trade payables services, including inventory financing, accountsreceivable 

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financing, formula based lending, private label financing,rental finance, and warranty and collateral management services. 
*Healthcare Financial Services*
Healthcare Financial Services is exclusively directed to thespecial needs of the global healthcare industry. We bring a comprehensive set offinancial products and services to that market, including financing forequipment, information technology systems, real estate, acquisitions,recapitalizations, turnarounds, and working capital needs. We also providetax-exempt financing for non-profit hospitals, vendor financing programs formedical equipment suppliers, and equity capital for medical real estateinvestments. We serve healthcare companies of all sizes across a wide range ofsectors. Customers include hospitals and health systems; physician practices;outpatient diagnostic and treatment centers; skilled nursing and assisted livingfacilities; medical device manufacturers, life science companies, and othersuppliers of products and services to the healthcare sector.
**CONSUMER FINANCE**
Consumer Finance (20.0%, 17.5% and 16.2% of total revenue in2003, 2002 and 2001, respectively) is a leading provider of credit products andservices to consumers, retailers and auto dealers in 38 countries. We offer abroad range of financial products, including private-label credit cards,personal loans, bank cards, auto loans, leases and inventory financing,residential mortgages, corporate travel and purchasing cards, debtconsolidation, home equity loans, and credit insurance. As further discussed onpage 20, we acquired First National Bank and the retail sales unit of ConsecoFinance Corp. as part of our continued global expansion.

     Our operations are subject to a variety of bank andconsumer protection regulations, including data privacy. Further, a number ofcountries have ceilings on rates chargeable to consumers in financial servicetransactions. We are subject to competition from various types of financialinstitutions including commercial banks, leasing companies, consumer loancompanies, independent finance companies, manufacturers' captive financecompanies, and insurance companies. Industry participants compete on the basisof price, servicing capability, promotional marketing, risk management, andcross selling. The markets in which we operate are also subject to the risks ofdeclining retail sales, changes in interest and currency exchange rates, andincreases in personal bankruptcy filings.

     Our headquarters are in Stamford, Connecticut and ouroperations are located principally in the United States, and in Europe, Asia,Latin and South America, Australia and New Zealand.

     Our activities are conducted through the principalbusinesses described below. For further information about principal revenues,net earnings, and assets for these businesses, see page 19.
*Global Consumer Finance*
Global Consumer Finance is a leading provider of financialproducts and services to retailers, auto dealers, and consumers outside of NorthAmerica. We provide private-label credit cards and proprietary credit servicesto retailers in Europe, Asia Pacific and, to a lesser extent, Latin and SouthAmerica. We also provide a variety of direct-to-consumer credit programs such aspersonal loans, bank cards, auto loans and leases, residential mortgages, debtconsolidation, home equity loans and the distribution of credit insurance. Ourcustomers include retailers such as Tesco, Coles Myer and Wal-Mart.

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*Card Services*
Card Services is a leading provider of sales financing servicesto North American retailers in a broad range of consumer industries. Productofferings include customized private-label credit card solutions for retailerssuch as JC Penney, ExxonMobil, Wal-Mart, Sam's Club, Macy's and Lowe's. Productofferings also include personal loans, home equity loans, business creditservices, and corporate travel and purchasing cards.
**EQUIPMENT MANAGEMENT**
Equipment Management (7.3%, 8.1% and 8.3% of total revenue in2003, 2002 and 2001, respectively) helps customers manage, finance and operate awide variety of business equipment worldwide. We provide rentals, leases, sales,asset management services and loans for portfolios of commercial andtransportation equipment, including tractors, trailers, auto fleets, railroadrolling stock, intermodal shipping containers and modular space units.

           Our operations are conducted in highly competitivemarkets. Economic conditions, geographic location, pricing and equipmentavailability are important factors in this business. Future success will dependupon the ability to maintain a large and diverse customer portfolio, optimizeasset mix, maximize asset utilization and effectively manage credit risk. Inaddition, we seek to understand and deliver unique product and service offeringsto our customers in the most efficient and cost effective manner. In September2003, we acquired the assets of CitiCapital Fleet Services.

     Our headquarters are located in Stamford, Connecticut withoffices throughout the United States and in Canada, Mexico, Europe and AsiaPacific.
**INSURANCE**
Insurance (40.8%, 39.7% and 40.6% of total revenue in 2003, 2002and 2001, respectively) offers a broad range of insurance and investmentproducts that help consumers create and preserve personal wealth, protect assetsand enhance their life styles. For lenders and investors, it protects againstthe risks of default on low-down-payment mortgages. For businesses, we providereinsurance and primary commercial insurance products to insurance companies,Fortune 100 companies, self-insurers and healthcare providers. Through December2003, for state and local governments and other public entities, we offeredfinancial guarantees for a variety of debt securities. 

     In November 2003 GE announced its intent for an initialpublic offering (IPO) of a new company, Genworth Financial, Inc. (Genworth),comprising most of our life and mortgage insurance businesses. We plan to sellapproximately one-third of Genworth's equity in the IPO, and we expect (subjectto market conditions) to reduce our ownership over the next three years asGenworth transitions to full independence. We commenced the IPO process inJanuary 2004 and expect to complete the IPO in the first half of the year,subject to market conditions and receipt of various regulatory approvals.

     Our headquarters are located in Richmond, Virginia withoffices throughout the United States and in Canada, Europe, Latin America,Australia, and Asia Pacific. 

     Our activities are conducted through the principalbusinesses described below. For further information about revenues and netearnings for these businesses, see page 21. 

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*GE Financial Assurance*
GE Financial Assurance provides a wide variety of insurance,protection and asset management products to help consumers achieve financialsecurity at every stage of life. Our strategy is to provide dependable productsto address consumer needs for wealth accumulation, retirement income, personalprotection, and wealth transfer. We distribute these products through a familyof regulated insurance affiliates. Our principal product lines in North Americaare annuities (deferred and immediate, fixed and variable); life insurance(universal, term, ordinary and group); guaranteed investment contracts(including funding agreements); long-term care insurance; supplementary accidentand health insurance; and consumer club memberships. Principal European productlines and services are payment protection insurance (designed to protectconsumers' loan repayment obligations) and personal investment products. Productdistribution in North America and Europe is accomplished primarily through fourchannels: intermediaries (brokerage general agencies, banks and securitiesbrokerage and financial planning firms); dedicated sales forces and financialadvisors; worksite distribution; and direct and affinity marketing. During 2003,(consistent with GE's announced intent to redirect capital to different lines ofbusiness) GE Financial Assurance sold its Japanese life insurance business.

           Consolidation in the financial services industry will create fewer but largercompetitors. We believe the principal competitive factors in the sale of ourproducts are product features, price, commission structure, marketing anddistribution arrangements, brand, reputation, financial strength ratings andservice. We believe that we are well positioned in the current competitiveenvironment and will benefit from a number of significant demographic,governmental and market trends, including an aging United States population withgrowing retirement income needs, and an increasing life and lifestyle protectiongap.

           Many of our activities are regulated by a variety of insurance and otherregulators. Our headquarters are in Richmond, Virginia. 
*Mortgage Insurance*
Mortgage Insurance offers mortgage insurance products thatfacilitate homeownership by enabling borrowers to buy homes withlow-down-payment mortgages. These products also aid financial institutions inmanaging their capital efficiently by reducing the capital required forlow-down-payment mortgages. We also have leading mortgage insurance operationsin Canada, Australia and the U.K. and a growing presence in Continental Europe.

     The mortgage insurance industry is sensitive to theinterest rate environment and housing market conditions. The mortgage insuranceindustry is intensely competitive as excess market capacity seeks to underwritebusiness being generated from a consolidating customer base. In addition,considerable influence is exerted on the industry by two government-sponsoredenterprises, which buy the majority of the loans insured by mortgage insurers.

     During 2003, General Electric Mortgage InsuranceCorporation (GEMICO), requested that its financial strength ratings be loweredfrom AAA/Aaa to AA/Aa2 positioning our United States business to operate atlower capital levels. This change improves our capital efficiency and return onequity while retaining a conservative risk-to-capital ratio. 

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*GE Global Insurance Holding (Employers Reinsurance Corporation)****
Through our principal insurance and reinsurance companyaffiliates – Employers Reinsurance Corporation, GE Reinsurance Corporation, theGE Frankona Group and the Medical Protective Corporation – we writesubstantially all lines of reinsurance (where the insured party is anotherinsurance company) and select lines of direct property and casualty insurance(where the insured party is a non-insurance company or an individual).

           The reinsurance operations include the reinsurance of property and casualtyrisks written by more than 1,000 insurers around the world. Direct insuranceoperations are focused on niche lines of business, principally medicalmalpractice coverage for physicians and dentists, medical professional liabilityfor hospitals, errors and omissions coverage for insurance agents and brokers,professional liability insurance for attorneys, excess indemnity forself-insurers of medical benefits and excess workers' compensation forself-insurers. The life reinsurance affiliates are engaged in the reinsurance oflife insurance products, including term, whole and universal life, annuities,certain health-related coverages and the provision of financial reinsurance tolife insurers. During 2003, we announced our intent to scale back on lifereinsurance operations to improve overall returns and we ceased writing new lifereinsurance business in the United States and sold our United States lifereinsurance business – ERC Life Reinsurance Corporation.

           In our opinion, we compete in the reinsurance marketplace principally on thebasis of our expertise, relationships, financial strength, price and creativityin developing customized solutions to customer needs. Within the directinsurance marketplace, we believe we compete principally on the basis of ourproduct offerings, established relationships with customers and key distributionpartners, price and ease of doing business.

           Employers Reinsurance Corporation is one of thelargest competitors in its marketplace. Our property and casualty reinsuranceoperations are ranked fifth in the world in terms of net premiums written and wecompete with the world's largest reinsurers as well as dozens of smaller nichecompetitors. Our life reinsurance operations are ranked in the top four lifereinsurers in the world.

           Maintaining strong financial strength ratings is animportant factor in remaining competitive in both the reinsurance and directinsurance markets in which we compete. During 2003, certain external creditrating agencies announced the lowering of financial strength ratings withrespect to GE Global Insurance Holding and subsidiaries, citing poor recentoperating performance as the principal factor. Rating agencies took similaractions to lower the ratings of many insurers and reinsurers in recent years.Debt ratings for GE Global Insurance Holding affect $1.7 billion of outstandingdebt. While these ratings were lowered in 2003, they remain investment grade. Wedo not believe these actions will materially affect GE Global Insurance Holdingliquidity or capital resources or the ability to write future business.
**ALL OTHER GECS**
All Other GECS includes activities and businesses that we do notmeasure within one of the four operating segments.  A description of AllOther GECS principal businesses follows. For further information about revenuesand net earnings for these businesses, see page 23.

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*IT Solutions*
IT Solutions is a provider of a broad array of informationtechnology services and products, including full life cycle services thatprovide customers with cost-effective control and management of theirinformation systems. Services offered include remote network/server/securitymonitoring and management, client support covering asset management, help deskand desk side support, as well as program management and professional servicesfor the security, network, server and storage environments.   Productsoffered include desktop personal computers, client server systems, UNIX systems,local and wide area network hardware, and software.  IT Solutions servescommercial, educational and governmental customers in the United States andCanada. During 2003, IT Solutions sold its business units in Europe.  

Competition in information technology services and products isvery active and comes from a number of principal manufacturers and otherdistributors and resellers. Markets for services and products are highly pricecompetitive. Additionally, many information technology product manufacturers arebypassing traditional information technology resellers in favor of directmanufacturer relationships with the ultimate end-users. IT Solutions'headquarters are in Erlanger, Kentucky.
*GE Equity*
GE Equity manages equity investments in early-stage,early-growth, pre-IPO companies. This portfolio consists primarily of directinvestments in convertible preferred and common stocks in both public andprivate companies; we also participate in certain investment limitedpartnerships. The portfolio includes investments in the technology andcommunications, media and entertainment, business services, financial servicesand healthcare sectors. The portfolio is geographically diversified withinvestments located throughout the United States, as well as in Europe, Asia andLatin America. We ceased making new investments in 2002, but continue to providefinancial support to companies in its portfolio which will be managed formaximum value over time, eventually liquidating. Headquarters are in Stamford,Connecticut.
*American Communications*
American Communications (Americom) engaged primarily as asatellite service supplier to a diverse array of customers, including thebroadcast and cable TV industries, as well as broadcast radio. It also suppliedintegrated communications services for government and commercial customers. Wealso operated communications satellites and maintained a supporting network ofearth stations, central terminal offices, and telemetry, tracking and controlfacilities. On November 9, 2001, we exchanged our satellite operations,comprising the stock of Americom and other related assets and liabilities, for acombination of cash and 31% of the publicly-traded stock of SES Global, aleading satellite company, in order to create the world's largest satelliteservices provider. Our investment in SES Global is accounted for on the equitymethod within Commercial Finance. 

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**REGULATIONS AND COMPETITION**
Our activities are subject to a variety of federal and stateregulations including, at the federal level, the Consumer Credit Protection Act,the Equal Credit Opportunity Act and certain regulations issued by the FederalTrade Commission. A majority of states have ceilings on rates chargeable tocustomers in retail time sales transactions, installment loans and revolvingcredit financing. Insurance and reinsurance operations are subject to regulationby various state insurance commissions or foreign regulatory authorities, asapplicable. Our international operations are subject to regulation in theirrespective jurisdictions. To date, compliance with such regulations has not hada material adverse effect on our financial position or results of operations.

     The businesses in which we engage are highly competitive.We are subject to competition from various types of financial institutions,including banks, thrifts, investment banks, broker-dealers, credit unions,leasing companies, consumer loan companies, independent finance companies,finance companies associated with manufacturers and insurance and reinsurancecompanies.
**BUSINESS AND ECONOMIC CONDITIONS**
Our businesses are generally affected by general business andeconomic conditions in countries in which we conduct business. When overalleconomic conditions deteriorate in those countries, there generally are adverseeffects on our operations, although those effects are dynamic and complex. Forexample, a downturn in employment or economic growth in a particular national orregional economy will generally increase the pressure on customers, whichgenerally will result in deterioration of repayment patterns and a reduction inthe value of collateral. However, in such a downturn, demand for loans and otherproducts and services we offer may actually increase. Interest rates, anothermacro-economic factor, are important to our businesses. In the lending andleasing businesses, higher real interest rates increase our cost to borrowfunds, but also provide higher levels of return on new investments. For ouroperations that are less directly linked to interest rates, such as theinsurance operations, rate changes generally affect returns on investmentportfolios.
**FORWARD-LOOKING STATEMENTS**
This document includes certain "forward-looking statements"within the meaning of the Private Securities Litigation Reform Act of 1995.Forward-looking statements may be identified by words such as "expects,""anticipates," "intends," "plans," "believes," "seeks," "estimates," "will" orwords of similar meaning and include, but are not limited to, statements aboutthe expected future business and financial performance. Forward-lookingstatements are based on management's current expectations and assumptions whichare inherently subject to uncertainties, risks and changes in circumstances thatare difficult to predict. Actual outcomes and results may differ materially fromthese expectations and assumptions due to changes in global political, economic,business, competitive, market regulatory and other factors.
**Item 2. Properties.**
We conduct our business from various facilities, most of whichare leased. The locations of our primary facilities are described in Item 1.Business.
**Item 3. Legal Proceedings.**
We are not involved in any material pending legal proceedings.

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**Item 4. Submission of Matters to a Vote of Security Holders.**
Not required by this form.
**PART II

Item 5. Market for the Registrant's Common Equity and RelatedStockholder Matters.**
See note 16 to the consolidated financial statements. Our commonstock is owned entirely by GE Company and an affiliate and, therefore, there isno trading market in such stock.
**Item 6. Selected Financial Data. **
The following selected financial data should be read inconjunction with our financial statements and the related Notes to ConsolidatedFinancial Statements.
 **Years ended December 31   *(In millions)**2003 **2002 **2001 **2000 **1999  **** **** **** **** **** 
Revenues
$
64,279 
$
58,699 
$
58,856 
$
66,709 
$
56,269                 
Earnings before accounting changes 
7,754  
4,626  
5,586  
5,192  
4,443 
Cumulative effect of accounting changes 
(339
) 
(1,015
) 
(169
) 
–  
–   ****  ****  ****  ****  **** 
Net earnings 
7,415  
3,611  
5,417  
5,192  
4,443  **** **** **** **** **** 
Return on average shareowner's equity 
18.74
% 
14.91
% 
22.47
% 
24.15
% 
22.55
%
GECS ratio of earnings to fixed charges 
1.87  
1.35  
1.62  
1.61  
1.62 
GECC ratio of debt to equity 
6.20:1  
6.58:1  
7.31:1  
7.53:1  
8.44:1                 
Financing receivables – net
$
226,029 
$
198,060 
$
172,346 
$
141,631 
$
132,253                 
Total assets 
554,526  
489,828  
425,484  
370,636  
345,018                 
Short-term borrowings 
132,988  
130,126  
160,844  
123,992  
129,259 
Long-term senior notes 
161,278  
139,573  
77,920  
80,383  
69,770 
Long-term subordinated notes 
1,262  
1,263  
1,171  
996  
996 
Minority interest 
4,701  
4,445  
4,267  
3,968  
4,391 
Shareowner's equity 
45,308  
36,929  
28,590  
23,022  
20,321 
Insurance premiums written  
18,602  
16,999  
15,843  
16,461  
13,624 
  
  
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**Item 7. Management's Discussion and Analysis of Results ofOperations.****OPERATIONS**
We present Management's Discussion of Operations in three parts:Overview of Our Earnings from 2001 through 2003, Segment Operations andInternational Operations. 

     In the accompanying analysis of financial information, wesometimes refer to data derived from consolidated financial information but notrequired by U.S. generally accepted accounting principles (GAAP) to be presentedin financial statements. Certain of these data are considered "non-GAAPfinancial measures" under the U.S. Securities and Exchange Commission (SEC)regulations; those rules require the supplemental explanation and reconciliationprovided on page 39. 
**ON JANUARY 1, 2004, WE SIMPLIFIED OUR ORGANIZATION. We willachieve lower costs of operations in platforms that will accommodate our futuregrowth. The segments most affected by this change follow: 

•     Commercial Finance – the combination of Commercial Financeand the Fleet Services business that was previously part of Equipment Management

•     Equipment and Other Services – the combination ofEquipment Management and the former All Other GECS segments 

Results for 2003 in this financial section are reported on thesame basis in effect in 2003.

     GE announced in November 2003 its intent for an initialpublic offering (IPO) of a new company, Genworth Financial, Inc. (Genworth),comprising most of our life and mortgage insurance businesses. We plan to sellapproximately one-third of Genworth's equity in the IPO, and we expect (subjectto market conditions) to reduce our ownership over the next three years asGenworth transitions to full independence. We commenced the IPO process inJanuary 2004 and expect to complete the IPO in the first half of the year,subject to market conditions and receipt of various regulatory approvals. 

     See the Segment Operations section on page 15 for a moredetailed discussion of our businesses. 
**Overview of Our Earnings from 2001 through 2003**
The global economic environment must be considered whenevaluating our 2001 to 2003 results. Important factors for us included slowglobal economic growth, a mild U.S. recession that did not cause significantlyhigher credit losses, lower global interest rates and distinct developments intwo industries that are significant to us (property and casualty insurance andcommercial aviation).  As you will see in detail in the following pages,our diversification and risk management strategies reduced the earnings effectsof many of the significant developments of the last three years. Our resultswere affected by a combination of factors, both positive and negative, asfollows:

•     At Employers Reinsurance Corporation (ERC), we, like mostof the reinsurance industry, faced volatility throughout the period. We are nowconfident we have worked through our historical underwriting mistakes. But in2002 we recognized losses on our 1997-2001 business, increasing loss reserves by$3.5 billion, resulting in a loss of $1.8 billion in 2002, a decline of $1.9billion from 2001. In 2003, our turnaround 

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     efforts started to pay off. We realized benefits fromimproved ERC operations and ERC earnings rebounded by $2.3 billion to a profitof $0.5 billion.

•     Commercial and Consumer Finance at 47% and 85% ofconsolidated three-year revenues and earnings before accounting changes,respectively, are large, profitable growth businesses in which we continue toinvest with confidence. In a challenging economic environment, these businessesgrew earnings by $0.9 billion in 2003 and $0.6 billion in 2002. Solid coregrowth, disciplined risk management and successful acquisitions have deliveredthese strong results.

•     Equipment Management is economically sensitive andconsequently was affected adversely by the U.S. recession and by slow globalgrowth in developed countries. Even in the difficult environments it faced, thisbusiness continued to succeed in its primary role, to generate cash. Highercapacity, in combination with declining or weak volume growth in many industriesserved by this business, resulted in fierce competitive price pressures.Earnings declined $0.2 billion over this period. 

Other factors that were important to our recent earningsperformance included gains on the sale of Americom ($0.6 billion) in 2001;favorable tax settlements with the U. S. Internal Revenue Service (IRS) in 2002($0.3 billion); as well as gains on the sale of certain of our Insurancebusinesses ($0.3 billion) in 2003.

     Acquisitions affected our operations and contributed $2.3billion, $3.7 billion and $1.5 billion, respectively, to each of the lastthree-year's consolidated revenues. Our consolidated net earnings in 2003, 2002and 2001 included approximately $0.3 billion, $0.4 billion and $0.2 billion,respectively, from acquired businesses. We integrate acquisitions as quickly aspossible and only revenues and earnings during the first 12 months following thequarter in which we complete the acquisition are attributed to such businesses.

     Significant matters in our Statement of Earnings, page 41,are explained below. 
**INTEREST EXPENSE ON BORROWINGS was $9.9 billion in 2003 and2002, compared with $10.6 billion in 2001. Changes over the three year periodreflected the effects of lower interest rates, partially offset by the effectsof higher average borrowings of $279.7 billion, $250.1 billion and $212.2billion in 2003, 2002 and 2001, respectively, used to finance asset growth andacquisitions. The average composite effective interest rate was 3.5% in 2003,compared with 4.1% in 2002 and 5.1% in 2001. In 2003, average assets of $521.6billion were 15% higher than in 2002, which in turn were 18% higher than in2001. See page 29 for a discussion of interest rate risk management. 
**INCOME TAXES on earnings before accounting changes were15.8% in 2003, negative 1.7% in 2002 and 19.8% in 2001. The increase from 2002to 2003 reflected the absence of a current year counterpart to the 2002 pre-taxloss at ERC and the IRS settlements discussed below, as well as lower pre-taxlosses at GE Equity, partially offset by an approximately three percentage pointdecrease due to the 2003 pre-tax loss and tax benefit on the disposition ofshares of ERC Life Reinsurance Corporation (ERC Life). See note 13. 

     Our 2002 effective tax rate reflected pre-tax losses at ERCand GE Equity, the effects of lower taxed earnings from international operationsand favorable tax settlements with the IRS. Pre-tax losses of $2.9 billion atERC and $0.6 billion at GE Equity reduced our effective tax rate byapproximately 17 percentage points. 

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     During 2002, as a result of revised IRS regulations, wereached a settlement with the IRS allowing the deduction of previously realizedlosses associated with the prior disposition of Kidder Peabody. Also during2002, we reached a settlement with the IRS regarding the treatment of certainreserves for obligations to policyholders on life insurance contracts in the GEFinancial Assurance business. See note 13.
**SEGMENT OPERATIONS

REVENUES AND SEGMENT PROFIT FOR OPERATING SEGMENTS are shown on page 16. As discussed in our 2002 Annual Report onForm 10-K, effective January 1, 2003, we made changes to the way we report oursegments, including the use of business specific, market-based leverage inmeasuring performance of our financial services businesses. Prior yearinformation has been reclassified to conform to the 2003 presentation. Foradditional information, including a description of the products and servicesincluded in each segment, see page 4.
     Segment profit is determined based on internal performancemeasures used by our Chairman to assess the performance of each business in agiven period. In connection with that assessment, the Chairman may excludematters such as charges for restructuring; rationalization and other similarexpenses; certain gains/losses from dispositions; and litigation settlements orother charges, responsibility for which precedes the current management team.

     Revenues and earnings before accounting changes, byoperating segment, for the past three years are summarized and discussed below.For purposes of this discussion, earnings before accounting changes is referredto as net earnings, which excludes goodwill amortization and accounting changes.

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**CONSOLIDATED***For the years ended December 31 (In millions)**2003 **2002 **2001     **REVENUES         
Commercial Finance
$
18,869 
$
17,781 
$
15,759 
Consumer Finance 
12,845  
10,266  
9,508 
Equipment Management 
4,707  
4,766  
4,904 
Insurance 
26,194  
23,296  
23,890 
All Other GECS 
1,664  
2,590  
4,795     
Total revenues
$
64,279 
$
58,699 
$
58,856    **NET EARNINGS         
Commercial Finance
$
3,765 
$
3,189 
$
2,788 
Consumer Finance 
2,161  
1,799  
1,602 
Equipment Management 
172  
313  
377 
Insurance 
2,102  
(95
) 
1,879 
All Other GECS
(446
)
(580
)
(508
)    
Total earnings before accounting changes 
7,754  
4,626  
6,138 
     Cumulative effect of accounting changes 
(339
) 
(1,015
) 
(169
)    
Total net earnings 
7,415  
3,611  
5,969 
     Amortization of goodwill 
–  
–  
(552
)   
Total net earnings – as reported
$
7,415 
$*******************************************************************************************