CIT Group Inc., the commercial lender that emerged from bankruptcy protection late last year, said Thursday that it closed a $667 million equipment lease securitization. The notes issued were eligible collateral under the government's Term Asset-Backed Securities Loan Facility, which was intended to spur lending to consumers and small businesses at lower rates.

Under the program, investors use the funds to buy securities backed by auto and student loans, credit cards, business equipment and loans guaranteed by the Small Business Administration.

CIT said it sold six classes of fixed rate notes in a private offering backed by a pool of equipment leases originated by CIT Vendor Finance. All but $50 million of the offering was sold to investors that did not use financing under the TALF program.

Proceeds will be used to partially refinance an existing loan and for general corporate purposes, CIT said.

It marked CIT's second TALF-eligible securitization. [Read the full article]

Discover Financial Services (NYSE:DFS - News) today announced that the company will record an increase in reserves of $305 million pre-tax in the first quarter 2010, which brings its reserve coverage to approximately twelve months of losses. This reserve addition results from a new analytical process that enhances management ability to estimate incurred losses on non-delinquent accounts.

Including the impact of the reserve addition, Discover expects to report a loss per share for the first quarter 2010 of $.22 to $.23.

Discover also estimates that the first quarter net principal charge-off rate for its Direct Banking segment will be approximately 8.5%, up from 8.43% in the fourth quarter 2009. The over 30-day delinquency rate is estimated to be approximately 5%, a reduction of approximately 25 basis points from the fourth quarter 2009. [Read the full article]

Discover Financial Services on Thursday said it expects to post a loss for its fiscal first quarter after setting aside more funds to cover soured loans.

The credit-card company expects a first-quarter loss of 22 cents per share to 23 cents per share. Analysts polled by Thomson Reuters expected earnings of 9 cents per share.

The company also said it expects its first-quarter net principal charge-off rate for its direct banking segment to rise to 8.5 percent from 8.43 percent in the fourth quarter of 2009. The charge-off rate refers to loans the company no longer expects will be repaid.

The company's over-30 day delinquency rate, a good predictor of future charge-offs, is expected to be 5 percent in the quarter. That's 0.25 percentage points lower than the fourth quarter of 2009. Discover believes delinquent loan balances may have peaked in the last quarter of 2009. [Read the full article]