By: Albert Tirado
Despite receiving $2.3 billion in federal bailout funds, small-business lender CIT Group Inc. filed for Chapter 11 bankruptcy Sunday afternoon.
CIT is the first firm to fail after receiving government bailout money. The bankruptcy is the largest loss so far for the Trouble Asset Relief Program and ranks among the top five largest bankruptcies in U.S. history.
The 101-year-old company's prepackaged bankruptcy plan is expected to allow the company to leave court protection by the end of the year under the control of its debt holders. While shareholders could receive new notes worth 70 percent of their existing shares, the Treasury Department probably will not see any of its bailout funds repaid
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