CIT Reports Third Quarter Results

Business Wire, Oct 17, 2007

* Managed assets were up 5% from June 30, 2007 due in part to seasonal growth in Trade Finance and Student Lending and up 17% over last year (21% excluding home lending), driven by the combination of solid origination volume and acquisitions.

* Excluding home lending, finance receivables held for sale increased $0.7 billion during the quarter to $3.0 billion primarily on higher Vendor Finance levels.

Capitalization, Funding and Liquidity

* The ratio of total tangible equity to managed assets at September 30, 2007 was 7.69%, down from 8.27% last quarter and 9.36% last year.

* During the quarter we funded our business principally in the asset-backed markets. We raised approximately $9.8 billion of proceeds through on and off balance sheet financings including: $4.3 billion secured by home loans, $2.8 billion secured by student loans, $1.5 billion secured by factoring receivables and $1.2 billion secured by equipment.

* In October, we received an additional $0.8 billion of proceeds from home lending receivables securitizations.

* Commercial paper outstandings declined to $3.6 billion from $6.2 billion at June 30,2007.

* Alternate liquidity at September 30, 2007 included cash and equivalents approximating $5.0 billion, committed and available bank lines of $7.5 billion, and committed and available asset-backed facilities of $2.4 billion.

* The Company's preferred stock and junior subordinated notes require the Company to satisfy dividend and interest payments with the net proceeds from the sale of common stock in the event the Company's rolling four-quarter fixed charge coverage ratio is less than 1.10. Following the previously discussed home lending actions, the Board of Directors authorized the Company to issue and sell common stock in amount sufficient to allow it to pay dividends and make interest payments on the aforementioned securities. As a result of selling shares of common stock on October 16, 2007, the Company satisfied the conditions necessary to permit the declaration and payment of preferred stock dividends payable December 17, 2007.

Segment Results:

Our segment disclosures reflect changes in our operations relating to the former Consumer and Small Business Lending segment. The presentation of prior period data has been conformed to current period presentation.

* The home lending business is being reported as a separate segment, due to changed market conditions and our outlook that such conditions will prevail for the foreseeable future.

* The student lending business and certain small consumer loan portfolios previously in the Consumer and Small Business Lending segment, are reported in the Consumer segment.

* The small business lending unit was transferred from the former Consumer and Small Business Lending segment to the Corporate Finance segment during the quarter, in line with recent management reporting changes.

Corporate Finance

* Total net revenues (the sum of net finance revenue and other income) decreased from the prior year as revenue from higher assets and improved advisory fee income from our recent acquisition was offset by lower gains from loan sales and syndications, due to lower market liquidity and syndication activity. We syndicated or sold approximately $850 million of receivables compared to $1.9 billion last year.