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CIT Group CEO to retire

Jeffrey Peek said he will continue to lead restructuring efforts at beleaguered small-business lender, before departing by year end.

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By David Ellis, CNNMoney.com staff writer

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NEW YORK (CNNMoney.com) -- Jeffrey Peek, the chairman and CEO of the embattled small-business lender CIT Group, said Tuesday he plans to resign from those roles at the end of the year.

No immediate replacement was named, although the company said the board was forming a search committee to find his replacement.

"Now is the appropriate time to focus on a transition of leadership, and I look forward to working closely with our board during that process," Peek said in a statement.

Peek, a long-time Wall Street banker who joined CIT Group in 2003 as its chief operating officer, has been leading a massive restructuring effort at the firm, after it ran into short-term funding woes earlier this year.

The company considered filing for bankruptcy as recently as July, before it received a $3 billion emergency loan in July from some of its largest bondholders. In August, the firm completed a debt repurchase program to raise cash.

With few signs of improvement in the health of the firm, the company launched a restructuring plan earlier this month aimed at shaving off $5.7 billion of its debt.

That proposal, however, which would require bondholders exchange their current notes for a portion of a series of newly issued secured notes and/or preferred shares. appears to be attracting scant interest from bondholders, Reuters reported Monday.

If the company is unable to clear out its debt, it is believed that a Chapter 11 bankruptcy filing is likely.

Peek's planned departure marks the latest exit of a high-profile financial firm CEO. Less than two weeks ago, Bank of America (BAC\, Fortune 500) chief Ken Lewis also said he planned to step down by year end.

CIT (CIT, Fortune 500) stock, which has been flirting with a price of $1 per share, was 21% lower in pre-market trading. To top of page

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