The Obama administration has rejected CIT Group's pleas for a bailout, and the troubled commercial lender is likely to file for bankruptcy as early as today, reports the Washington Post. CIT—which has already received $2.3 billion in TARP funds—provides financing to close to a million small- and medium-sized businesses, thousands of which may be badly hurt by the lender's demise.
Insiders say that the Treasury's decision came after lengthy debate, in which it decided to "draw a line in the sand" on bailouts. "They must have realized if they were going to support CIT, there was no end, it was a bottomless pit and anyone could show up with any excuse" demanding a government bailout, said an analyst.
(More CIT Group stories.)