CIT Group Files For Bankruptcy Protection

The CIT Group filed for Chapter 11 protection Sunday, reporting its bondholders approved a prepackaged plan to reduce debt by $10 billion after a debt-exchange offer to bondholders failed, according to published reports.

CIT’s bankruptcy filing shows $71 billion in finance and leasing assets and total debt of $64.9 billion, according to an AP report.

CIT reported the plan could allow the commercial lender to exit bankruptcy protection by the end of the year., according to reports.

CIT said the bankruptcy filing is only for its holding company, and it won’t impact its operating subsidiaries, including CIT Bank and its trade finance unit.

Although CIT last week received $4.5 billion in credit from its lenders and bondholders and a $1 billion line of credit from bondholder Carl Icahn, the company couldn’t get bondholders to back a debt swap that would have cut nearly $6 billion in debt.

CIT filed motions to allow the company, among several things, to pay its vendors and some other creditors in full, according to published reports.