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CIT Group (CITGQ) Stock Anyone?

by on Saturday, November 7th, 2009 | 9 Comments

CIT Group like so many other lenders made some seriously bad decisions and got caught up in the subprime mortgage debacle that came to a head towards the end of last year.  Although the centennial bank holding company received 2.3 billion from the government under the Troubled Asset Relief Program last year the government did not award CIT a separate program that would allow it to issue debt at low interest rates. 

CIT GroupOn November 1, 2009 CIT Group Inc. (CITGQ.PK) shares plunged 65% to .25 cents after the lender filed Chapter 11 bankruptcy.  Almost immediately following on November 3, 2009 CIT Group announced that the U.S. Bankruptcy Court scheduled a hearing to consider prepackaged plan of reorganization for December 8, 2009.  That is good news.

According to documents reviewed by The Wall Street Journal about 700 companies have a total of $3.9 billion in undrawn revolvers from CIT. Many are small businesses that obtained revolving facilities of about $10 million to $50 million in size. CIT is the sole or main lender to two-thirds of these companies, and a failure of the lender would leave many without access to funds.  With this in mind the the prepackaged plan of reorganization scheduled for December 8, 2009 could very well fall in favor for the bank holding behemoth. 

November 6, 2009 CIT Group Quote

At just .$018 as of November 6, I'll take a significant risk and order 9,600 shares upon market opening this Monday.  At worst I'm only out $1700 but there is the potential for a nice return over the next six months.

About CIT Group (CITGQ):

CIT group's headquarters in New York

CIT is a bank holding company with more than $60 billion in finance and leasing assets that provides financial products and advisory services to small and middle market businesses. Operating in more than 50 countries across 30 industries, CIT provides an unparalleled combination of relationship, intellectual and financial capital to its customers worldwide. CIT maintains leadership positions in small business and middle market lending, retail finance, aerospace, equipment and rail leasing, and vendor finance. Founded in 1908 and headquartered in New York City, CIT is a member of the Fortune 500. www.cit.com

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  • http://www.top-affiliate.com Stephen

    Unfortunately I've heard the same as well Joseph. I have no idea how that's legal but they've already gone back to their old ticker of CIT.

  • http://www.top-affiliate.com Stephen

    Unfortunately I've heard the same as well Joseph. I have no idea how that's legal but they've already gone back to their old ticker of CIT.

  • J Busuttil

    I have bought CITGQ.PK shares ….I heard that these will be cancelled on new CIT issue. Is this even legal …can it be possible that there is no accountability from CIT??

    Joseph

  • http://www.stephenralph.com Stephen

    Additional information about CIT’s restructuring can be found on the Company’s Web site, http://www.cit.com. For access to Court documents and other general information about the Chapter 11 cases, please visit http://www.kccllc.net/citgroup. The Company has established a toll-free Supplier Information Line at 800-422-2738 or, if you are calling from outside the U.S. 973-422-3877 and a toll-free Restructuring Information Line for all other interested parties at 866-967-1786 or 310-751-2686.

  • http://www.stephenralph.com/ Stephen

    Additional information about CIT’s restructuring can be found on the Company’s Web site, http://www.cit.com. For access to Court documents and other general information about the Chapter 11 cases, please visit http://www.kccllc.net/citgroup. The Company has established a toll-free Supplier Information Line at 800-422-2738 or, if you are calling from outside the U.S. 973-422-3877 and a toll-free Restructuring Information Line for all other interested parties at 866-967-1786 or 310-751-2686.

  • http://www.stephenralph.com Stephen

    NEW YORK, Nov 20 (Reuters) – Sellers of protection on CIT Group Inc's (CITGQ.PK) bonds will need to pay buyers 31.88 percent of the insurance they sold, after an auction was held on Friday to set a value for the company's credit default swaps.

    CDSs on CIT's bonds are worth 68.12 cents on the dollar, said auction administrators Creditex and Markit.

  • http://www.stephenralph.com/ Stephen

    NEW YORK, Nov 20 (Reuters) – Sellers of protection on CIT Group Inc's (CITGQ.PK) bonds will need to pay buyers 31.88 percent of the insurance they sold, after an auction was held on Friday to set a value for the company's credit default swaps.
    CDSs on CIT's bonds are worth 68.12 cents on the dollar, said auction administrators Creditex and Markit.

  • http://www.stephenralph.com Stephen

    Investor Carl Icahn on Friday raised his offer for the senior notes of bankrupt CIT Group to $650 per $1,000 of principal notes tendered.  Not quite sure why he did that but the offer is good until December 2, 2009.

  • http://www.stephenralph.com/ Stephen

    Investor Carl Icahn on Friday raised his offer for the senior notes of bankrupt CIT Group to $650 per $1,000 of principal notes tendered.  Not quite sure why he did that but the offer is good until December 2, 2009.