CIT Takes $340 Million Hit on Mortgage Portfolio
The CIT Group said Friday morning that it will increase loan loss reserves by $300 million for the fourth quarter of 2007. The provision, based primarily on home loans held for investment, is expected to drag down net income by approximately $190 million, the company said. CIT will also record a pre-tax loss of approximately $40 million on home lending receivables held-for-sale during the quarter. Home lending receivables held-for-sale at December 31, 2007 are expected to be approximately $350 million. As a result, CIT said it anticipated reporting a net loss for the fourth quarter of $125 million to $135 million, or $0.65-$0.70 per share. For more information, visit http://www.cit.com.