CIT Group Inc., a 101-year-old commercial lender, filed for bankruptcy to cut $10 billion in debt after the credit crunch dried up its funding and a U.S. bailout and debt exchange offer failed. The groups bank named CIT Bank however will keep functioning. CIT listed $71 billion in assets and $64.9 billion in debt in a Chapter 11 filing in US Bankruptcy Court in Manhattan. The US Treasury Department said the government probably wont recover much, if any, of the $2.3 billion in taxpayer money that went to CIT. The bankruptcy will allow CIT to continue to provide funding to our small business and middle-market customers, said Chief Executive Officer Jeffrey Peek in a statement. CIT, which filed the fifth-largest bankruptcy by assets, said it plans to exit quickly due to support from bondholders, who voted in favor of a so-called prepackaged plan. None of CITs operating subsidiaries, including Utah-based CIT Bank, were included in the filing, and operations will proceed as normal, CIT said in a statement. CIT has $1 billion from investor Carl Icahn to fund operations while it reorganizes.
