NEW YORK (CNN/Money) - General Electric Co. is breaking its financial services business into four separate units, the company said Friday, giving CEO Jeffrey Immelt more involvement in the company's biggest business.

Effective Aug. 1, GE Capital, which accounts for about 40 percent of the manufacturer's earnings, will split into separate units handling commerce, consumer, insurance and equipment businesses. Each business will report directly to Immelt and GE vice chairman Dennis Dammerman.

"The reason for doing this is simple -- I want more direct contact with the financial services teams," Immelt stated.

Michael Neal will be CEO of the new GE Commercial Finance, while David Nissen will be CEO of GE Consumer Finance, Arthur Harper will be CEO of GE Equipment Management, and Michael Fraizer will be CEO of GE Insurance.

GE Capital CEO Denis Nayden, his job eliminated by the restructuring, plans to create a separate financial services advisory company, GE said. He will serve as a senior advisor to Immelt and the GE Capital board on business development and other matters.

Shares of Fairfield, Conn.-based GE (GE: up $0.26 to $26.91, Research, Estimates) rose in midday trading.

The company, whose diverse products include light bulbs, home appliances, jet engines and medical equipment and which also owns one of the world's leading financial services companies as well as broadcaster NBC, recently reported improved second-quarter earnings -- but GE Capital earnings dropped 18 percent.

The recent series of scandals on Wall Street has led many investors to criticize GE's size and financial complexity, and Friday's move to break up GE Capital was at least partially an effort to make its biggest business more transparent.

"This will create a clearer line of sight on how our financial services businesses operate and enhance growth," Immelt said. "Our external reporting will mirror this organizational structure, providing greater clarity for investors."

On the same day GE reported second-quarter earnings, CNN/Money learned that GE had scrapped plans for an initial public offering of its property and casualty insurance business and was considering selling the unit in the future.