After months of restructuring attempts, small business lender CIT Group Inc. said it has filed for Chapter 11 bankruptcy protection in part to get rid of $10 billion in debt.
Under the plan, CIT said expects to reduce total debt by approximately $10 billion, reduce its liquidity needs over the next three years, enhance its capital ratios and accelerate its return to profitability, the company said in a Nov. 1 statement.
CIT said it is planning to emerge from Chapter 11 by the end of the year. The bank holding company has more than $60 billion in finance and leasing assets providing services to more than one million small and middle market businesses.
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Credit unions could potentially fill a void left by CIT by providing accounts receivable, lines of credit and general banking services, several industry experts have said. Some smaller businesses that depend on lines of credit may feel the impact the most from CIT's bankruptcy filing.
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