CIT posts $48 million 2Q loss on higher debt costs
CIT Group (CIT) posted a second-quarter loss of $48 million, or 24 cents per share, on costs tied to a prepayment on debt. The lender to small and midsize businesses earned $182 million, or 91 cents per share, a year earlier. CIT fared better than analysts expected, with the average forecast predicting a loss of 32 cents a share range. "While our recent efforts to advance our liability restructuring initiatives further reduce our cost of capital and position CIT for long-term success and profitability, they negatively impacted our second quarter results," said CIT Chairman and CEO John Thain. Second-quarter results were hurt by the company's early retirement of $2.5 billion of second lien debt and $163 million in debt-related costs. During the quarter, the company's provision for credit losses fell 31% from the previous quarter and 66% over last year as net charge-offs declined. Thain, the former Merrill Lynch executive, was brought to CIT Group to help restructure the firm in the wake of a 2009 bankruptcy. Write to Kerri Panchuk.