CIT Said To Obtain $3B In Financing
July 20, 2009 at 6:19 AM (PT)
CIT GROUP INC. may announce an agreement TODAY (7/20) to obtain $3 billion of emergency financing from bondholders, keeping the struggling lender out of bankruptcy, a person close to the matter told REUTERS. "The money could strengthen CIT's finances and allow more time for the 101-year-old lender to small- and mid-sized businesses, some of which are in the broadcast industry, to restructure its debt.
"An agreement could also preserve the government's $2.33 billion investment in CIT from the Troubled Asset Relief Program. CIT became eligible for such financing when it became a bank holding company in DECEMBER.
"A bankruptcy could have rippled through the economy by making it difficult or impossible for thousands of businesses to obtain financing to run day-to-day operations. It would have made CIT, with $75.7 billion of reported assets, the largest U.S. financial company to go bankrupt since LEHMAN BROTHERS HOLDINGS INC. last SEPTEMBER."