COMPANY NEWS; Sears Expands Finance Sector

Sears, Roebuck & Company, the highly diversified conglomerate with major interests in retailing and financial services, announced today a major step in expanding the consumer finance operations of its Dean Witter Financial Services Group.

Sears said it would dissolve its Allstate Financial Corporation subsidiary, which was the financing arm for consumer loans, and consolidate its operations into the Dean Witter Financial Services Group.

Sears will transfer to Dean Witter Allstate's $720 million consumer auto and home improvement loan portfolio.

Consumer loans once made by Allstate Financial will now be made by another Sears unit, the Allstate Savings & Loan Association, which is part of the Dean Witter Financial Group. Instead of raising consumer loan funds through the issuance of commercial paper, loans will now be generated through Allstate certificate of deposits.

Ernest Arms, a Sears spokesman, said the consolidation was made ''to transfer Allstate Financial's activities into a more appropriate business segment.''

He said the shift to certificate of deposit from commercial paper as the source of generating consumer loans ''would better match the maturities of assets and liabilities.''