On one hand, a restructuring is exactly what the debt-laden lender needs and it's good to see nature finally taking its course. On the other, the lender would be forced to shrink itself into a smaller company, which bodes ill for the thousands of small companies that rely on CIT for financing to conduct their daily operations. Where are those companies going to turn? Our nation's banks? They are too busy using their available capital to trade stocks and bonds. They have no excess capacity to lend to pipsqueak borrowers.
The debt exchange is set to last 20 business days. One way or another, we'll have some closure to the "Is CIT going to make it?" situation.