STEVE INSKEEP, Host:
The financial crisis, the story that keeps on giving. We can tell you again this morning the government is closely monitoring the fragile condition of a major financial services firm. This company is not exactly a household name, but CIT has a million business customers who rely on the company for financing everything from buying aircraft to stocking retail shelves.
NPR's Yuki Noguchi has more on the potential ripple effects of that company's problems.
YUKI NOGUCHI: CIT Group said over the weekend it's trying to keep itself afloat by getting access to cash through a government program, or through some other means. But banking expert Bert Ely says that's a tough sell.
BERT ELY: CIT is weak financially. Its debt is rated as junk bonds. So it's really, you know, somewhat borderline.
NOGUCHI: It's had to pay higher interest rates to obtain the money it loans out to customers, while at the same time, its loan losses keep creeping higher, as more of its borrowers default. If CIT winds up in bankruptcy and its ability to lend is really impaired, Ely says the many businesses that depend on it may have to cut back jobs or reduce investment.
ELY: Many CIT customers have not been able to get credit from banks, and to the extent that CIT is not able to meet their needs, they're going to have to look elsewhere.
NOGUCHI: And banks elsewhere have already tightened their lending. Treasury Secretary Timothy Geithner said yesterday, he is monitoring the developments.
Yuki Noguchi, NPR News.
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