CIT still at risk of bankruptcy despite last-minute loans

New York, July 21, SPA -- (dpa) - CIT Group, a critical lender to
small businesses in the United States, remained at risk of bankruptcy
Tuesday despite reaching a last-minute deal with creditors for about
3 billion
dollars in emergency financing, according to dpa.

CIT said that, even with the financing deal reached late Monday,
it would need to more broadly restructure its debt by mid-August in
order to avoid filing for bankruptcy.

The news sent its stock plummeting again on Tuesday after a brief
reprieve on Monday. CIT provides loans to about 1 million small and
medium-sized businesses in the United States, but the effect its
collapse would have on the country's sputtering economy is disputed.

CIT's creditors agreed Monday evening to provide up to 3 billion
dollars in emergency loans to keep the company afloat. CIT would be
the largest bank bankruptcy since the collapse of Washington Mutual
in September.

President Barack Obama's administration has refused to intervene
this time around. The Treasury Department has already provided CIT
with 2.3 billion dollars in emergency loans.
--SPA