By  on July 22, 2009

CIT Group Inc. said losses continued to pile up in the second quarter and warned bankruptcy was still a possibility if bondholders don’t agree to take less than face value for $1 billion in debt coming due next month.

After weeks of searching for a financial lifeline, and some harried 11th-hour negotiations, CIT reached a $2 billion credit agreement with a group of its key bondholders Monday and expects to receive another $1 billion in commitments this month. But the two-and-a-half-year financing package comes at a heavy price, with an interest rate of 10 percent plus the London Interbank Offer Rate.

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