GE denies rumors of dividend cut; CEO buys 50,000 shares

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With its shares briefly falling below $15 today, General Electric Co. insisted -- again -- that it has no plans to cut its dividend, despite rumors to the contrary.

CEO Jeffrey Immelt also stepped up with more than $800,000 of his own money to buy 50,000 GE shares in the open market, according to a filing with the Securities and Exchange Commission.

GE often is viewed as a microcosm of the global economy, which conjures up bad images for investors when much of the world is skidding into a recession. And the company’s huge financial unit, GE Capital, has become a source of worry as the credit crunch has worsened.

Seeking to ease investors’ concerns, GE this week got permission to tap a new federal program under which up to $139 billion of GE Capital’s debt will be insured by the Federal Deposit Insurance Corp.

Today, vague rumors about a dividend cut helped push GE shares as low as $14.58, the lowest since 1996, from $16.29 at Wednesday’s close.

The company issued a statement reiterating its previous promise to maintain the current quarterly dividend of 31 cents a share through 2009.

The statement also noted that GE’s participation in the FDIC debt-guarantee program doesn’t place restrictions on the company’s dividend policy.

Meanwhile, Immelt today paid between $16.41 and $16.45 each for his 50,000 shares, which indicates he made the purchase early in the session.

Had he waited a bit, he could have gotten almost $2 off those prices, at the session’s low.

GE Vice Chairman Michael Neal showed better timing: He bought 50,000 shares today at $14.99 each, according to an SEC filing.

GE shares had rebounded to $16.11 just before noon PST, helped by a broad-based market turnaround.