CIT expects fourth quarter loss
NEW YORK, Jan 7 (Reuters) - CIT Group Inc (CIT.N), a commercial finance firm that has become a bank holding company to qualify for government help, said on Wednesday it expects to report a fourth quarter loss.
The company said in a regulatory filing the loss for the quarter ended Dec 31, 2008, reflected a significant increase in reserve for credit losses, further compression of net interest margin, write-offs of certain account reconciliation differences and costs related to the process of becoming a bank holding company."
CIT did not not specify how large the loss would be.
CIT obtained preliminary approval in December to receive $2.33 billion under the government's financial bailout program after the Federal Reserve gave it permission to become a bank holding company.
The bank said it would report a $99 million pre-tax gain on the extinguishment of about $490 million in debt it paid down to qualify for the government funds.
In October, the bank posted a third quarter loss to common shareholders of $317.3 million, or $1.11 a share, compared with a loss of $46.3 million, or 24 cents a share in the year-earlier period.
CIT shares slid 35 cents, or 6.92 percent to close at $4.71 in trading on the New York Stock Exchange on Wednesday. (Reporting by Phil Wahba; editing by Carol Bishopric)
