Last week representatives of the FDIC closed a deal to award General Electric Co.’s lending group GE Capital Corporation as much as $139 billion in insurance coverage for debt protection. This marks the second time in a month the finance company has sought aid from the federal government.

The agreement is looked as a positive, reassuring move meant to give peace of mind to GE investors by some experts. Russell Wilkerson, a GE spokesman, suggested that the FDIC plan would allow for the company to compete with other banking institutions that have received debt security from the government. The plan provides coverage for approximately $139 billion, which is about 125% of the senior unsecured debt outstanding since September 30 and set to mature by the end of June 2009.

GE Capital qualifies for coverage under the guidelines of the FDIC plan due to ownership claims in an industrial loan company and a federal savings bank; both qualify for government aid. In October, the company started a Federal Reserve program that was meant to revive commercial paper markets.

General Electric, like thousands of other companies and industries, is feeling the effects of the country’s heaviest financial crisis since the Great Depression. The company’s market value has dropped more than half in 2008 alone. Shares have reached lows not seen since January 1997, weighing in at around $16 a share.

The FDIC debt insurance program was organized on October 14th by U.S. regulators. It was to be fast response measure made available to banks that had debt issued through June 30, 2009. GE was part of wave of affiliated non-banking groups that were allowed to apply on a subsequent date. As with the banking institutions eligible under the plan, GE would be required to pay a premium on insurance coverage. The coverage starting date was on or before November 14 and runs outs on June 30, 2012.

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