Thank you Hank, Ben and Tim. Excellent work. Seriously. Great f*cking job. Maybe just maybe you should have peered at the books before committing TARP funds.
A month later, Sheila Bair got a peek and said 'no way' are they getting FDIC debt. Their bankruptcy was unnoticed by markets. Yet avoidance of market disruption was the reason given for TARP's original investment in CIT. Like I said, not even a ripple when they filed.
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The U.S. Treasury has officially lost its entire $2.33 billion TARP investment in CIT Group , according to a company filing.
The Treasury made the investment in CIT in December 2008, but CIT then ran into trouble after the Federal Deposit Insurance Corp. refused to guarantee its debt, as the FDIC did for larger lenders, including General Electric and large banks like Citigroup , Bank of America and Wells Fargo. CIT ended up filing for bankruptcy protection on Nov. 1 but was able to reorganize and return to a public listing on Dec. 10.
Contrary to what many assumed, the bankruptcy filing did not extinguish all hope for a taxpayer recovery. The Treasury and other preferred shareholders received complex securities called contingent value rights (CVRs) which could have been worth something if CIT Group's stock had reached the mid-50s ahead of Monday's session, according to the estimate of another investor who held CVRs.
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