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FOR IMMEDIATE RELEASE
CIT REPORTS FOURTH QUARTER 2012 NET INCOME OF $207 MILLION ($1.03 PER DILUTED SHARE); PRE-TAX INCOME OF $334 MILLION EXCLUDING DEBT REDEMPTION CHARGES
FULL YEAR NET LOSS OF $592 MILLION ($2.95 PER DILUTED SHARE) INCLUDING $1.5 BILLION OF DEBT REDEMPTION CHARGES; PRE-TAX INCOME OF $1.0 BILLION EXCLUDING DEBT REDEMPTION CHARGES
Fourth Quarter Financial Highlights
|§||Grew Commercial Assets – Increased 8% from a year ago; fifth consecutive quarter of sequential growth;|
|§||Significant New Business Activity – Funded volume of $3.1 billion; rose 41% sequentially and 6% from the year-ago quarter;|
|§||Finance Margin Improved - Funding cost declines reflect benefit of debt redemption actions; portfolio yields remain stable;|
|§||Credit Metrics Remain At Cyclical Lows - Non-Accrual balances further declined and net charge-offs remain at low levels;|
|§||Expanded CIT Bank – Assets surpassed $12 billion; online deposits exceed $4.5 billion; originated over 95% of U.S. loan and lease volume.|
CIT Group Inc. (NYSE: CIT), a leading provider of financing and advisory
services to small businesses and middle market companies, today reported net income of $207 million, $1.03 per diluted share,
for the fourth quarter of 2012, improved from $36 million, $0.18 for the year-ago quarter. The current period includes net charges
of $83 million related to the redemption of student loan asset-backed securities and certain senior unsecured notes, while the
year-ago period included debt redemption charges of $150 million. Pre-tax income excluding debt redemption charges for the quarter
was $334 million, up from $221 million in the year-ago quarter. There was a net loss for the year ending December 31, 2012 of
$592 million ($2.95 per share), which included $1.5 billion of debt redemption charges, compared to net income of $15 million,
($0.07 per share) for the year ended December 31, 2011, which included $528 million of debt redemption charges.
NEW YORK – January 29, 2013 –
“We made significant progress in advancing our corporate strategy in 2012,” said John Thain, Chairman and Chief Executive Officer. “We grew commercial assets, diversified our funding mix, and expanded new business initiatives that further support our small business and middle market clients. We remain focused on positioning CIT for future growth and profitability as we drive operating efficiencies, prudently grow our assets, and expand CIT Bank.”
In preparing the financial statements for the quarter and year ended December 31, 2012, management identified errors that were not material to any individual prior period, but determined that correcting these errors in the current period would have been material to the 2012 full year statement of operations. Therefore, CIT will revise its previously reported financial statements for the first three quarters of 2012, and for the years ended December 31, 2011 and 2010 for these and other previously disclosed out-of-period errors. The cumulative effect of these errors was to increase tangible book value (TBV) per common share by $0.04, which is reflected in the $39.61 TBV per share at December 31, 2012. Further information is provided in the “Prior Period Revisions” section and the Appendix. All prior period data in this release and in the Financial Data Package (which is available on our website at www.cit.com/investor) reflect the revised balances.
Summary of Fourth Quarter Financial Results
Fourth quarter results reflect increased business activity, continued positive portfolio performance, and the benefits of our liability restructuring and other balance sheet management actions. Pre-tax income was $252 million for the quarter and included net charges of $83 million related to debt redemptions, compared to pretax income of $71 million in the year-ago quarter, which included $150 million of debt redemption charges. Excluding these charges, pretax income was $334 million in the current quarter, improved from $221 million in the year-ago quarter and $176 million in the prior quarter. See the Non-GAAP disclosure table on page 19 for additional information.
Total assets at December 31, 2012 were $44.0 billion, up $0.3 billion from September 30, 2012, and down $1.3 billion from December 31, 2011. Commercial financing and leasing assets increased from prior periods to $30.2 billion, while consumer assets declined by approximately $600 million from September 30, 2012 and by over $2.6 billion from a year ago primarily due to the sale of student loans. Total loans of $20.8 billion increased nearly $1.0 billion from a year ago, and $0.5 billion sequentially. Operating lease equipment increased $0.4 billion from a year ago and $0.3 billion from September 30, 2012 to $12.4 billion, consisting primarily of aircraft and railcars. Cash and short-term investments increased to $7.6 billion from $7.2 billion at September 30, 2012.
Funded new business volume of $3.1 billion rose from both the prior and year-ago quarters with increased activity levels from the year-ago quarter in all segments except Transportation Finance, which had an elevated number of aircraft deliveries in the year-ago period. Trade Finance factoring volume was $6.9 billion, up from the third quarter of 2012, in line with seasonal trends, and essentially unchanged from the prior-year quarter.
Net finance revenue1 was $312 million and reflects generally stable yields and improvements in funding cost that resulted from the repayment and/or refinancing of high cost debt and increased
The following information was filed by Cit Group Inc (CIT) on Tuesday, January 29, 2013 as an 8K 2.02 statement, which is an earnings press release pertaining to results of operations and financial condition. It may be helpful to assess the quality of management by comparing the information in the press release to the information in the accompanying 10-K Annual Report statement of earnings and operation as management may choose to highlight particular information in the press release.
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