For Immediate Release

Chicago, IL - May 3, 2012 - announces the list of stocks featured in the Analyst Blog. Every day the Zacks Equity Research analysts discuss the latest news and events impacting stocks and the financial markets. Stocks recently featured in the blog include CIT Group Inc. ( CIT), Barclays PLC ( BCS), Credit Suisse Group ( CS), Morgan Stanley ( MS) and UBS AG ( UBS).

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Here are highlights from Wednesday's Analyst Blog:

CIT Issues $2B in Senior Notes

CIT Group Inc. ( CIT) announced the pricing of its senior unsecured notes worth $2 billion. Of the total, $1.25 billion worth of senior notes are due in 2017 and the remaining lot, worth $750 million, is due in 2020.

BofA Merrill Lynch, Barclays PLC ( BCS), Credit Suisse Group ( CS) and Morgan Stanley ( MS) and UBS Investment Bank -- a unit of UBS AG ( UBS) -- are acting as joint book-running managers for the offering.

The sale of notes would ensure enough liquidity to refinance the 7% Series C notes due in 2016 and 2017. It will also help getting good credit ratings from the ratings agencies. Moreover, the funds can be used for general and corporate purpose.

The Notes due in 2017 and 2020 are priced at par, and these carry interest at the rate of 5.000% and 5.375%, respectively.

The current offering follows the company's issuance of senior note worth $1.5 billion in March. The proceedings were used to refinance the Series notes.

Since January 2010, the company has eliminated or refinanced over $23.5 billion of high cost-first and second-lien debt. This consists of $7.5 billion of first-lien debt, its entire $12.3 billion of Series A notes, $2.1 billion of Series B notes and $1.6 billion of Series C notes.

Additionally, on April 2, CIT announced that it would redeem $500 million of its 7% Series C Notes maturing in 2017 on May 2, 2012. Following the completion of this redemption, nearly $6.7 billion of debt would be left related to the Series C notes in its balance sheet, along with the unsecured revolving credit facility.

Earnings Recap

CIT reported a loss of $2.22 per share in the first quarter 2012, substantially higher than the Zacks Consensus Estimate of a loss of $1.54. This also compared unfavorably with prior-quarter earnings of 22 cents.

The results were adversely impacted by negative net revenue and higher interest and operating expenses. However, improved credit quality and sturdy capital ratios were the positives.

Our Take

We believe that the steps taken by CIT to restructure its balance sheet and reduce the cost of debt would bring down its funding costs to a great extent. This will ultimately lead to improved net interest margin and profitability. The company is also focusing on earning better investment grade rating from the rating agencies to attract more investors and bail itself out of the situation.

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BARCLAY PLC-ADR (BCS): Free Stock Analysis Report
CIT GROUP (CIT): Free Stock Analysis Report
CREDIT SUISSE (CS): Free Stock Analysis Report
MORGAN STANLEY (MS): Free Stock Analysis Report
UBS AG (UBS): Free Stock Analysis Report
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Tickers in this Article: BCS, CIT, CS, MS, UBS

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