CIT Group (NYSE:CIT) said Chief Executive Officer Jeffrey Peek plans to resign at the end of the year, as the commercial lender of about a million small and medium-sized businesses struggles to avoid bankruptcy.
The company announced today that its board of directors is forming a search committee to oversee the recruitment process.
The outgoing CEO, Jeffrey Peek, who has been with CIT Group since 2003, said in a statement that CIT’s recently launched restructuring plan — designed to increase the co.’s capital levels — makes it “the appropriate time to focus on a transition of leadership.“
Devastated by the downturn in the credit markets, CIT has been attempting for months now to restructure its operations to remain in business.
The New York-based lender received $2.3 billion in government bailout money last fall, a $3 billion emergency loan in July from some of its largest bondholders, and bought back $1 billion in debt. The co. however, still needs to significantly reduce its debt in order to avoid bankruptcy, which seems increasingly likely at this point.
Experts have warned that a collapse of CIT would deal a major blow to an already fragile economy.