CIT bailout talks hit the buffers

WASHINGTON/NEW YORK: CIT Group Inc, a lender to hundreds of thousands of small and mid-sized US businesses, said bailout talks with the government had ended, a development that could ultimately drive the company into bankruptcy.

Wednesday's announcement followed last-ditch talks in which Treasury officials had expressed concern about a worsening liquidity crunch at the 101-year old lender and indications that government aid would not put it on a path to recovery.

It also showed the possible limits of Washington's ability and willingness to rescue companies, after multiple bailouts engineered by Treasury, the Federal Reserve and the Federal Deposit Insurance Corp for larger companies such as American International Group Inc and Citigroup Inc.