SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
FORM 8-K
CURRENT REPORT
Pursuant to Section 13 or 15(d) of the
Securities Exchange Act of 1934
Date of Report (Date of earliest event reported) January 13, 1994
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The CIT Group Holdings, Inc.
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(Exact name of registrant as specified in its charter)
Delaware 1-1861 13-2994534
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(State or other (Commission (IRS Employer
jurisdiction of File Number) Identification No.)
incorporation)
1211 Avenue of the Americas
New York, New York 10036
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Registrant's telephone number, including area code (212) 536-1950
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(Former name or former address, if changed since last report)
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Item 5. Other Events.
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See attached press release.
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SIGNATURES
Pursuant to the requirements of the Securities Exchange Act of
1934, the Registrant has duly caused this report to be signed on its
behalf by the undersigned hereunto duly authorized.
THE CIT GROUP HOLDINGS, INC.
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(Registrant)
By /s/ JOSEPH J. CARROLL
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Joseph J. Carroll
Executive Vice President and
Chief Financial Officer
Dated: January 14, 1994
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NEWS
(THE CIT GROUP, INC. LETTERHEAD)
Joseph J. Carroll
Chief Financial Officer
(201)740-5214
FROM: THE CIT GROUP HOLDINGS, INC.
1211 AVENUE OF THE AMERICAS
NEW YORK, NY 10036
FOR IMMEDIATE RELEASE
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THE CIT GROUP REPORTS RECORD 1993 NET INCOME OF $182.3 MILLION,
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12.3 PERCENT INCREASE OVER 1992
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NEW YORK, NEW YORK, JANUARY 13, 1994 --- The CIT Group Holdings, Inc.,
one of the nation's leading asset-based finance companies, today announced
record 1993 net income of $182.3 million, an increase of 12.3 percent
compared with $162.3 million in 1992. The current year results represent
the third consecutive year of record earnings and are the highest earnings
in the Corporation's eighty-six year history.
"CIT had an outstanding year in 1993," said Albert R. Gamper, Jr.,
president and CEO. "In a year in which we were challenged by high start-up
costs associated with our consumer finance operation and the significant
impact from the change in our Federal income tax rate, we were able to
record our sixth consecutive year of earnings growth," he added.
<PAGE>
"CIT's asset growth in 1993 was strong and our credit quality was
excellent. Perhaps more importantly, our profitability was broad-based,
confirming the validity of our strategy to continue to develop an
organization along multiple business lines. At the end of all the
analysis, it still comes down to the quality of people, and the 2500 CIT
employees turned out a tremendous effort in 1993. That effort resulted in
the growth, the credit quality and the overall performance of CIT," said
Gamper. "We are entering 1994 with a good deal of momentum," he continued.
Other financial highlights for 1993 include:
- Finance receivables and equipment under operating lease totaled
a record $13.4 billion at December 31, 1993, up 9.3 percent from
$12.2 billion at year-end 1992. The Corporation's operating units,
particularly Industrial Financing and Credit Finance, experienced
strong middle market growth in 1993 including a portfolio purchase
of approximately $264 million by Industrial Financing in December
1993.
- Net interest revenue of $673.9 million rose 8.2 percent from
$622.8 million in 1992, reflecting the strong growth in financing
and leasing assets, and higher fee income in several operating
units.
- Gains on asset sales were $23.9 million in 1993 reflecting a
third quarter gain from the securitization of manufactured housing
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receivables and the sale of assets coming off lease. In 1992, such
gains were $13.9 million.
- Net charge-offs declined to $94.4 million, or .77 percent of
average finance receivables, compared to $98.3 million, or .84
percent of average finance receivables in 1992.
- Operating expenses before the provision for credit losses
amounted to $282.2 million, or 2.30 percent of average earning
assets, compared to $261.6 million, or 2.30 percent of average
earning assets in 1992, reflecting the introduction of the consumer
finance operation and normal expense increases. Excluding the
consumer finance unit, operating expenses as a percent of average
earning assets declined to 2.20 percent in 1993 from 2.28 percent
last year, reflecting the corporation's commitment to expense
control coupled with the strong asset growth in 1993.
- Finance receivables past due 60 days or more were $216.1 million
(1.71 percent of finance receivables) at December 31, 1993, down
from $335.8 million (2.85 percent of finance receivables) at year-
end 1992. Past due receivables on nonaccrual status totaled $139.9
million (1.11 percent of finance receivables) at December 31, 1993,
compared to $234.2 million (1.99 percent of finance receivables) at
year-end 1992.
- Assets received in the settlement of loans declined to
$87.0 million at December 31, 1993, from $93.8 million at December
31, 1992.
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The CIT Group Holdings, Inc., one of the nation's largest asset-based
lenders, is owned 60 percent by The Dai-Ichi Kangyo Bank, Limited, the
largest bank in the world, and 40 percent by Chemical Banking
Corporation, one of the largest bank holding companies in the United
States.
(SEE ATTACHED TABLES FOR ADDITIONAL FINANCIAL DATA)
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THE CIT GROUP HOLDINGS, INC.
AND SUBSIDIARIES
CONSOLIDATED INCOME STATEMENTS
(DOLLAR AMOUNTS IN THOUSANDS)
YEAR-ENDED DECEMBER 31,
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1993 % to AEA 1992 % to AEA
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Interest and fees earned $ 1,181,914 9.50%* $ 1,174,796 10.13%*
Interest expense 508,006 4.00 * 552,017 4.67 *
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Net interest revenue 673,908 5.50 622,779 5.46
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Gains on asset sales 23,945 .20 13,883 .12
Salaries and employee
benefits 152,139 1.24 137,914 1.21
Other operating expenses 130,043 1.06 123,721 1.09
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Operating expenses before
provision for credit
losses 282,182 2.30 261,635 2.30
Provision for credit losses
on net charge-offs 94,408 .77 ** 98,284 .84 **
Provision for credit losses
for reserve change 10,466 .09 4,891 .04
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Provision for credit losses 104,874 .86 103,175 .90
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Total operating expenses 387,056 3.16 364,810 3.20
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Income before provision for
income taxes and
extraordinary item 310,797 2.54 271,852 2.38
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Provision for income taxes 128,489 1.05 105,311 .92
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Income before extraordinary
item 182,308 1.49 166,541 1.46
Extraordinary item-loss on
early extinguishment of
debt, net of income tax
benefit - - (4,241) ( .04)
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Net income $ 182,308 1.49% $ 162,300 1.42%
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Average financing and
leasing assets (AEA) $12,262,902 $11,401,683
Average finance receivables $12,266,125 $11,675,622
* Excludes interest income and interest expense relating to interest-
bearing deposits
** Percent to average finance receivables
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THE CIT GROUP HOLDINGS, INC.
AND SUBSIDIARIES
CONSOLIDATED BALANCE SHEETS
(DOLLAR AMOUNTS IN THOUSANDS)
DECEMBER 31, DECEMBER 31,
1993 1992
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ASSETS
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FINANCING AND LEASING ASSETS
Finance receivables (net of unearned finance
income of $1,482,069 and $1,592,049)
CORPORATE FINANCE
Capital Equipment Financing $ 4,394,528 $ 4,429,089
Business Credit 1,282,133 1,281,283
Credit Finance 645,642 545,023
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6,322,303 6,255,395
DEALER AND MANUFACTURER FINANCING
Industrial Financing 3,880,991 3,094,102
Sales Financing 1,438,865 1,411,812
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5,319,856 4,505,914
COMMERCIAL SERVICES 981,935 1,010,186
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Finance receivables 12,624,094 11,771,495
Reserve for credit losses (169,378) (158,483)
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Net finance receivables 12,454,716 11,613,012
Equipment under operating lease, net 751,901 462,757
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Net financing and leasing assets 13,206,617 12,075,769
CASH AND CASH EQUIVALENTS
Cash 101,554 89,793
Interest-bearing deposits - 610,000
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Cash and cash equivalents 101,554 699,793
OTHER ASSETS 420,310 252,866
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TOTAL ASSETS $13,728,481 $13,028,428
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LIABILITIES AND STOCKHOLDERS' EQUITY
DEBT
Commercial paper $ 6,516,139 $ 6,173,465
Variable coupon notes 1,686,500 1,477,830
Fixed rate notes 2,392,500 2,479,011
Subordinated fixed rate notes 200,000 200,000
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Total debt 10,795,139 10,330,306
Credit balances of factoring clients 521,728 452,606
Accrued liabilities and payables 324,520 284,427
Deferred Federal income taxes and investment tax
credits 394,859 359,998
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Total liabilities 12,036,246 11,427,337
STOCKHOLDERS' EQUITY
Common stock - authorized, issued and
outstanding - 1,000 shares 250,000 250,000
Paid-in capital 408,320 408,320
Retained earnings 1,033,915 942,771
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Total stockholders' equity 1,692,235 1,601,091
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TOTAL LIABILITIES AND STOCKHOLDERS' EQUITY $13,728,481 $13,028,428
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THE CIT GROUP HOLDINGS, INC.
AND SUBSIDIARIES
CONSOLIDATED STATEMENTS OF CHANGES IN STOCKHOLDERS' EQUITY
(DOLLAR AMOUNTS IN THOUSANDS)
YEAR ENDED
DECEMBER 31,
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1993 1992
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COMMON STOCK
Balance, beginning and end of period $ 250,000 $ 250,000
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PAID-IN CAPITAL
Balance, beginning of period $ 408,320 $ 258,320
Capital contribution from stockholders - 150,000
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Balance, end of period $ 408,320 $ 408,320
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RETAINED EARNINGS
Balance, beginning of period $ 942,771 $1,011,464
Net income 182,308 162,300
Dividends paid-regular (91,164) (80,993)
-special - (150,000)
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Balance, end of period $1,033,915 $ 942,771
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Total stockholders' equity $1,692,235 $1,601,091
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