I’ve been tracking the CIT situation all weekend, and it looks like the former Masters of the Universe may have to bite the bullet after all:July 18 (Bloomberg) — CIT Group Inc. advisers, including JPMorgan Chase & Co. and Morgan Stanley, are discussing options for funding the lender if it enters bankruptcy, people with knowledge of the matter said.[...]“This thing doesn’t have a future,” CreditSights analyst David Hendler said yesterday in a telephone interview. “Anything is possible but the problem is not solvable anymore. They’re just in denial it’s finally over,” the New York-based analyst said referring to the rescue financing. (Emphasis mine)
One paragraph struck me as particularly apt, given Obama’s proposed regulations to require financial companies plan for their own demise:
“It seems CIT was ill-prepared for this moment, so they’re scrambling,” said Scott Peltz, a managing director focused on restructuring at consulting firm RSM McGladrey Inc. “Unless you have all these bondholders holding hands and singing Kumbaya, I think they’re too far behind the eight ball to avoid filing.” (Emphasis mine)
