CIT: Bankruptcy Filing Still a Possibility

CIT Group says it might have to file for bankruptcy protection if not enough bondholders participate in an upcoming debt exchange.

The commercial lender offered the grim assessment only a day after major bondholders agreed to provide it with a $3 billion loan. However, CIT says the loan might not provide enough relief to cover upcoming debt maturities.

CIT Group says it still needs to pay off about $7 billion in debt maturing over the next year, including $1 billion in August. It has launched an offer to repay that $1 billion in maturing debt at a discount.

CIT shares are down 23 cents, or 18 percent, at $1.02, in early trading.

CIT turned to bondholders for help after the government refused to save the company last week.