CIT issues exchange offer to increase funds

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CIT Group, parent of CIT Aerospace, is commencing exchange offers for certain of its outstanding notes and all of its outstanding equity units related to its outstanding mandatory convertible senior notes to increase its regulatory capital in connection with its application to become a bank holding company.

The exchange offers are part of CIT's plans to raise approximately $1.4 billion of regulatory capital to support its application to become a bank holding company.

In addition to the exchange offers, CIT intends to raise the remaining amount of required capital through a public or private offering of capital stock that would qualify as tier 1 regulatory capital.

CIT anticipates that this capital raising plan, in combination with as much as $2.5 billion of tier 1 capital it has applied for through the US Treasury's TARP Capital Purchase Program, would provide sufficient capital to exceed the applicable regulatory requirements including the "well capitalised" requirement applicable to a financial holding company.

CIT is commencing an offer to exchange its outstanding equity units, stated amount $25 per unit for cash and shares of common stock, upon the terms and subject to the conditions set forth in its Offer to Exchange dated 17 November.

The company is also commencing an offer to exchange up to $1,500,000,000 of its outstanding notes specified for up to $350,000,000 in cash and up to $1,000,000,000 of newly-issued 12% subordinated notes due 2018.