CIT Group Inc. won court approval Tuesday to take steps to continue operating, as it began what it hopes will be a quick trip through bankruptcy court.
The commercial lender appeared in court for the first time since filing for bankruptcy protection Sunday with a restructuring plan backed by creditors, a deal that would slash more than $10 billion in debt off its books.
Judge Allan Gropper of the U.S. Bankruptcy Court in Manhattan approved a number of routine requests that will allow the New York company to continue operating, including paying employees and continuing its cash management system. What's most significant is that the judge signed off on a portion of a $500 million letter-of-credit facility from Bank of America Corp. that CIT will use to issue letters of credit. The judge said CIT can borrow up to $125 million of the financing and will consider approving the rest at a later hearing.
The judge set a Dec. 8 hearing to consider approving CIT's restructuring plan. The company hopes to emerge from bankruptcy protection by the end of the year.
