Quarterly profit at CIT Group
The $66.7 billion-asset company said in a press release Thursday that it earned $14.1 million, which was a significant decline from the $115.3 million it reported a year earlier. Earnings per share of 90 cents were 13 cents higher than the average estimate of analysts polled by Bloomberg.
The big charge stemmed from ongoing issues with CIT's Financial Freedom business, which the company inherited from its purchase of OneWest Bank in Pasadena, Calif. CIT bought OneWest
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CIT Group has embraced a system that mimics a single source of data to help it comply with increased regulatory scrutiny. It could also help the company become more efficient.
May 25 -
CIT's bread-and-butter business commercial banking weakened as it embarks on a broader turnaround plan. Soft demand from midsize companies plagued it and other lenders last quarter. Will that problem continue the rest of the year?
April 28 -
CIT Group in Livingston, N.J., reported higher profits, boosted by gains from its acquisition of OneWest Bank.
April 28
CIT earlier this year disclosed
Ellen Alemany, CIT's chairman and chief executive, said in the release that she was "disappointed" by the Financial Freedom charges.
Net interest income was $212.8 million, compared with $18.6 million last year. The loan-loss provision rose 52%, to $28.1 million. The net finance margin expanded by 32 basis points, to 3.65%.
Fee income rose by 13% to $673.6 million on gains from the sale of leasing equipment and gains on derivatives.
Noninterest expenses rose 31% to $582.9 million on higher salary expenses and professional fees.