Skip to: Content
Skip to: Site Navigation
Skip to: Search
WEDNESDAY, NOVEMBER 25, 2009
| Subscribe to Newser's RSS feeds RSS | Follow Newser on Twitter Twitter


10

Major Small-Business Lender Faces Bankruptcy

Share

(Newser) – One of America's biggest commercial lenders is preparing to file for bankruptcy, the Wall Street Journal reports. CIT Group, which lends to about a million small and medium-sized businesses, probably won't be able to make a $1 billion payment due in August and has hired bankruptcy counsel. In the meantime, it's pressing the government for help with "increased urgency," says one insider.

CIT received $2.3 billion in TARP funds but has been unable to access another federal program to help it sell debt with government guarantees. The closure of CIT would affect thousands of companies ranging from restaurant frachisees to clothing retailers, notes the Journal. "It would take a financing option away from franchisees who want to buy stores or expand their networks," said a Dunkin' Donuts executive.

CIT chairman and CEO Jeffrey Peek talks during the dedication of the CIT global headquarters in New York in this 2006 photo.
CIT chairman and CEO Jeffrey Peek talks during the dedication of the CIT global headquarters in New York in this 2006 photo.   (AP Photo/Mark Lennihan, File)
CIT is a major lender to franchisees, and counts many Dunkin' Donuts outlets among its customers.
CIT is a major lender to franchisees, and counts many Dunkin' Donuts outlets among its customers.   (AP Photo/Mike Groll)
« Prev« Prev | Next »Next » Slideshow

They are our sole financing partner and we are heavily reliant on them. If CIT fails, it would be detrimental to the confidence of many businesses. - Haresh Tharani, president of garment firm Tharanco Group

« Prev« Prev | Next »Next » Slideshow
OFF THE GRID
11.24.09
Murdoch and Microsoft: The Mice Are Trying to Roar
11.23.09
Books Are Bad for You
10 comments
VIEWING:
 
Karl
Jul 11, 09 10:14 AM CDT
Another one for Obama (Bush III). So far he's batting, what, 1000? Reply
Vote up! Vote down!
-1
IN RESPONSE:
Robert_Dada
Jul 11, 09 11:04 AM CDT
Yes, all these problems started 5 1/2 months ago, eh pilgrim? Did you have to drop out of school to work as a ranch hand or something?
Vote up! Vote down!
+1
IN RESPONSE:
northeast
Jul 12, 09 12:51 AM CDT
They began decades ago, hence the Bush III reference. Obama's fault is that although he honestly thought he was making things better, he's been continuing along the same path of corporate welfare at the expense of the taxpayer. He changed nothing but the scale, and expected different results. Predictably, things have gotten much worse.
Vote up! Vote down!
0
LiberalJesus
Jul 11, 09 10:56 AM CDT
And yet you Karl, like all losers offer zero ideas. Tell me Karl, what would you have done to correct 30 years of right wing policies that began with that idiot Reagan. Its easy to sit and complain that others dont know what they are doing, but even more cowardly to bash the President and offer no alternative solutions. All I have ever heard from the idiot republicans who's own GW Bush created this recession is "tax cuts"....look what irresponsible tax cuts did the last eight years. So unless you have a solution to all the problems Karl, may I suggest you shut up and that way you wont look so incredibly stupid. Offer some solution Karl. Reply
Vote up! Vote down!
0
IN RESPONSE:
northeast
Jul 12, 09 12:55 AM CDT
Here's the key..."irresponsible" tax cuts. If you cut military, educational, and welfare (corporate and otherwise) spending, then suddenly you're not just giving away money that you don't have. If you cut taxes while cutting the fat from the budget, you can put money in people's pockets while at the same time maintaining or reducing the deficit.
Vote up! Vote down!
0

View all 10 comments »

LEAVE A
COMMENT Comment Policy
Facebook ConnectPost this comment to Facebook?

After connecting you will have the option to post your comment on your Facebook profile.

 

Related Newser Stories

10 Stories

46 Bailed-Out Firms Behind on Repaying US

CIT bankruptcy will cost taxpayers $2.3B

Nov 16, 09 7:38 AM CST
(Newser) - A whopping 46 of the banks the government bailed out last year are behind on their payments, with some going belly-up despite the rescue. The largest so far, CIT Group, is in bankruptcy court today hoping to wipe out the $2.3 billion it owes Uncle Sam, and analysts tell... More »

MORE ABOUT:
General Motors • Wall Street bailout • TARP • CIT Group

 Mega-Lender CIT 
 Files Chapter 11 

Bailed-out firm's move will cost government $2.3B

Nov 1, 09 4:43 PM CST
(Newser) - CIT Group, a major lender to small and medium-sized American businesses, filed for Chapter 11 today. The move means the government is most likely out the $2.3 billion in TARP bailout funds it put up last year. The "prepackaged" procedure is intended to allow CIT, which reported $71... More »

MORE ABOUT:
Carl Icahn • bankruptcy • bailout • Chapter 11 • Troubled Asset Relief Program • Wall Street bailout • TARP • Jeffrey Peek • bankruptcy protection • CIT Group

CIT Bust Would Cost US $2.3B, Earn Goldman $1B

Taxpayers shares could go up in smoke while Goldman gains

Oct 5, 09 4:29 AM CDT
(Newser) - Troubled commercial lender CIT, circling the drain for more than a year, would cost taxpayers $2.3 billion in shares purchased by the Treasury Department if it files for Chapter 11 soon—but Goldman Sachs, which gave the lender emergency funding, stands to collect a $1 billion windfall if it... More »

MORE ABOUT:
Goldman Sachs • bankruptcy • risk management • bailout • Chapter 11 • credit default swap • CIT Group

10 Stories


Politics  •  Business 
TwitterFollow @NewserPolitics on Twitter

 
bankruptcy • commercial paper • FDIC • TARP • lenders • CIT Group

from our news partners