There's actually a rule that was imposed last year by China's security regulators that private placements cannot be completed at less than 90% of a stock's recent trading price. Based on the 524% (yes, that's right) rise in the Bank's stock price since the end of 2004, this would've meant that GE's purchase price would've jumped nearly 7 times the original agreed amount, which one can only assume that GE balked at. The rule gave the Bank a convenient face-saving way to exit the deal.
You have to feel bad for GE though. Since the deal was agreed in 2005, GE had been very open with the bank and had been introducing the bank to some of GE's working partners such as Walmart. The cooperation effectively helped fuel part of that 500% growth that was the deal breaker. It's not hard to imagine GE's disappointment and frustration with providing so much and then having its hands tied, but so far they've kept a stiff upper lip on the hopes of doing continued business.
What will be interesting to see is what happens to Shenzhen Development Bank's stock price. That commitment to sell a 7% at way below market price should have been factored into investors' valuations, so the stock should now rise as that deal is no longer on the table...but it would've liken risen anyways in this frothy market.