CIT Group Inc, a leading provider of financing to small businesses and middle market companies in the US, today reported net income of $142.1 million ($0.71 per share) for the quarter ended 30 June 2010, up from $97.3 million ($0.49 per share) last quarter.
CIT said the increase in income was due mainly to the gains on sales of assets and recoveries from non-performing assets (NPAs), which more than offset a higher provision for credit losses and costs for an employee retention programme announced last quarter.
The second quarter results were also buoyed by pre-tax net accretion and lower depreciation of $407 million, resulting from fresh start accounting (FSA) balance sheet adjustments recorded in December 2009, CIT said in a release.
"During the second quarter, we continued to advance our key corporate initiatives….During the second quarter we continued to advance our key corporate initiatives," said John A Thain, chairman and CEO.
"We improved our funding flexibility, repaid higher cost debt, streamlined our portfolio and largely completed the build-out of our senior management team. We remain committed to increasing the value of our commercial franchises and supporting the small business and middle market sectors that are vital to the US economy," he added.
Net interest revenue declined $31million on lower financing assets and less net FSA accretion. However, total net revenues increased 28 per cent sequentially as an increase in other income offset the decline in net interest revenue.