CIT Group’s third-quarter profit improved thanks to a variety of one-time items tied to an ongoing restructuring led by Chairwoman and CEO Ellen Alemany.
Net income at the $49 billion-asset Livingston, N.J., company rose 67% to $220 million, compared to the same period a year ago. Earnings per share, excluding several one-time items, were $1.02, or 23 cents estimate of analysts compiled by FactSet Research Systems.
One of the central goals of Alemany’s effort to restructure CIT has been to prune noncore assets. During the third quarter, she reached a deal to sell CIT’s reverse mortgage unit for $900 million.
Several one-time items affected CIT’s third-quarter results, including a $140 million deferred tax benefit from restructuring an international legal entity, which contributed $1.03 per share to earnings; and $33 million in charges for debt extinguishment charges, which reduced earnings by 24 cents per share.
Net interest income fell 4% to $277 million on lower purchase accounting accretion and higher negative income associated with the indemnification asset.
Noninterest income dropped 7% to $316 million due to a total of $27 million in aggregate charges, including a $5 million writedown of foreclosed property, $9 million of impairment on reverse mortgage-related assets and a $12 million writedown of reverse mortgage loans.
Noninterest expense rose 7% to $460 million, partly as a result of restructuring costs.