views

US officials at odds over bailout for CIT

US GOVERNMENT officials were last locked in debate over whether to throw a lifeline to ailing business lender CIT Group.<br /><br />Despite fears that CIT&rsquo;s financial woes could spell disaster for up to a million small and medium-sized businesses, the Federal Deposit Insurance Corp (FDIC) is resisting calls to offer the firm access to its loan guarantee programme.<br /><br />FDIC says it is worried that the company&rsquo;s debt would put at risk the insurance fund that is used to repay deposits when banks fail.<br /><br />CIT has been in talks with the Treasury Department, Federal Reserve and FDIC about possible solutions. CIT faces a debt payment and investors and customers have begun to lose confidence in the firm.