CIT's Bankruptcy May Help Bondholders, Erase Taxpayer, Shareholder Stakes

CIT Group Inc., the 101-year-old commercial lender that saw its funding dry up in the credit crunch, filed for bankruptcy in an effort to cut $10 billion in debt following a failed debt exchange and U.S. taxpayer bailout.

[Missy]

I was alerted today by my Edward Jones advisor that my Class 8 CIT bond would NOT be subject to the 70% recovery. They said CIT had changed my offer and the most I could get was to sell for 60% Nov.12-30, or receive "whatever was left" in bankruptcy court. But I was not going to receive this offer in writing. ONLY THE ADVISORS such as EDWARD JONES WOULD RECEIVE THIS INFO TO PASS ON TO THE CUSTOMERS.
Anyone else been advised of this?

[bogey]

Missy wrote:

I was alerted today by my Edward Jones advisor that my Class 8 CIT bond would NOT be subject to the 70% recovery. They said CIT had changed my offer and the most I could get was to sell for 60% Nov.12-30, or receive "whatever was left" in bankruptcy court. But I was not going to receive this offer in writing. ONLY THE ADVISORS such as EDWARD JONES WOULD RECEIVE THIS INFO TO PASS ON TO THE CUSTOMERS.
Anyone else been advised of this?

I also was contacted by my Edward Jones Financial(?) advisor Tue, Nov. 10 and advised to sell at 60% but in checking info on the movement of these bonds they were selling at 65% to 66%. Makes you wonder who is pocketing the 5% difference. I ran into a similar situation with Wells Fargo with muni bonds and was given a credit of $8000 on some questionable exchanges within minutes of the selling of my bonds.

[budha]

I was alerted by my Fidelity person. He said that they will get the information in a day or so. Meanwhile decided to sell half the bonds through fidelity and was able to get 65%.

bogey wrote:

<quoted text>
I also was contacted by my Edward Jones Financial(?) advisor Tue, Nov. 10 and advised to sell at 60% but in checking info on the movement of these bonds they were selling at 65% to 66%. Makes you wonder who is pocketing the 5% difference. I ran into a similar situation with Wells Fargo with muni bonds and was given a credit of $8000 on some questionable exchanges within minutes of the selling of my bonds.

[bogey]

Received a packet from CIT (thru E.Jones) about the bankruptcy. The info I received as a holder of the Class 9 Notes would receive a payout of 94.2% of face value plus maybe some stock in the new corp as of a result of the reorganization. Holding my notes until the December 8 hearing. If you check the bond activity of these notes you will find someone is buying a lot of them at $65. One purchase was over $900,000. Someone knows a lot more than I do and will be making a ton of dollars on the difference between 65 and 94. If I had that kind of dollars I would be doing the same thing.

[budha]

In addition to the one I sold, I have a class 9 bond. I also received the same information from CI by mail yesterday. May be by Dec8th, if I am lucky, I will be able to get close to 94%.

[Ehav]

American banksters. Have been laughing all the way to your wallets for 150 years.
because you let them.

[Jowels]

Talked to CIT Rep. He said the 94.2% is really 70% bonds and the rest of the 94.2% is in common shares.

[Mack]

Stupid but important question- how do I determine my bond "class"? I only have cusip and description "internotes".

[kats]

i have stock that i bought...what will happen with it?

[Pissed]

It should be against the law for a company (in bankruptcy) to continue to “trade”, if they are not willing to compensate the shareholders once the company “Exits Bankruptcy”.

(Sorry, I’m venting) I have lost money (just in time for the holiday season&#61516;). And I feel really bad for other people that invested in CIT GROUP (under CITGQ) believing in the company’s redemption, and this is what they get a simple “sorry you invested your money in our company, but on the bright side you can invest under our NEW symbol CIT, which is really the Old Symbol CIT also known as CITGQ, but we’re not going to honor the Old symbol CITGQ, but we’re going to honor the Old/New Symbol CIT…. And I know it’s not about the symbols, but you know what I mean.

And what about the people like me that believed that CIT Group would work their way through the storm, and not screw the shareholders. I believed that if I invested in CIT Group I could make money, to get myself out of my own financial crisis.

Furthermore, I go on different website and read all the financial Blogs, about how people should have known that the (CITGQ) stock was going to be worthless, and how all the information was out there.

Financial analyst fell to understand that “The average person that invest in stocks are not stock wizards, and most times when the “average person”, invest in most people don’t have broker, nor does extensive research, on a company.

Moving on, as far as CIT Group is concern it is a company that had $71 billion in assets, in bankruptcy, who would have ever thought that judge Allen Gropper would have approve a plan that would prevent CIT Group from honoring Common/Preferred Shareholders stocks, and whomever else that got swindled, knowing that CIT Group was still trading shares while in bankruptcy.

What can people do to recover from the CIT Group lost? Are there any company/persons filing an appeal to overturn judge Allen’s ruling? Is there anything the average person can do to recover besides fill out an IRS (loss) form? Are there any petitions out there?

[U WIN]

I bought 10000.00 shares of CIT at $ 0.85 before it exited the bankupcy under the SYMBOL of CIT.
Is there any one who can tell me that the Old CIT is as good as the NEW CIT?

[fred]

U WIN wrote:

I bought 10000.00 shares of CIT at $ 0.85 before it exited the bankupcy under the SYMBOL of CIT.
Is there any one who can tell me that the Old CIT is as good as the NEW CIT?

I can't answer your question, but ask yourself: Wouldn't it be too good to be true that what you bought at 85 cents is now worth $28? You know what they say about that.

[Missy]

Has anyone actually gotten the 94.2%, 70% new bond and 24.2% new common stock? I am very curious to know what the outcome was.