8/14/2019 TheSun 2009-11-03 Page15 Us Lender Cit Files for Bankruptcy

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business15theSun | TUESDAY NOVEMBER 3 2009

KLCI 1,241.76 1.47

STI 2,645.43 5.70

Hang Seng 21,620.19 132.68

SCI 3,076.65 80.80

Nikkei 9,802.95 237.71

TSEC 7,335.18 4.90

KOSPI 1,559.09 21.60

S&P/ASX200 4,540.40 102.80

Foreign currency Bank sell Bank buy Bank buy

TT/OD TT OD

1 US DOLLAR 3.4655 3.4005 3.3905

1 AUSTRALIAN DOLLAR 3.1370 3.0430 3.0270

1 BRUNEI DOLLAR 2.4780 2.4180 2.4100

1 CANADIAN DOLLAR 3.2150 3.1360 3.1240

1 EURO 5.1060 5.0020 4.9820

1 NEW ZEALAND DOLLAR 2.5180 2.4060 2.3900

1 PAPUA N GUINEA KINA 1.4490 1.1910 1.1750

1 SINGAPORE DOLLAR 2.4775 2.4180 2.4100

1 STERLING POUND 5.6990 5.5830 5.5630

1 SWISS FRANC 3.3890 3.3060 3.2910

100 ARAB EMIRATES DIRHAM 96.0200 90.9300 90.7300

100 BANGLADESH TAKA 5.1500 4.7660 4.5660

100 CHINESE RENMINBI N/A N/A N/A

100 DANISH KRONE 70.7900 65.0400 64.8400

100 HONGKONG DOLLAR 45.5000 43.0900 42.8900

100 INDIAN RUPEE 7.6500 7.0200 6.8200

100 INDONESIAN RUPIAH 0.0376 0.0330 0.0280

100 JAPANESE YEN 3.8640 3.7700 3.7600

100 NEW TAIWAN DOLLAR N/A N/A N/A

100 NORWEGIAN KRONE 62.4300 57.3600 57.1600

100 PAKISTAN RUPEE 4.2400 3.9700 3.7700

100 PHILIPPINE PESO 7.4300 6.9900 6.7900

100 QATAR RIYAL 96.6400 91.9200 91.7200

100 SAUDI RIYAL 93.8300 89.2600 89.0600

100 SOUTH AFRICAN RAND 44.4100 40.8300 40.6300

100 SRI LANKA RUPEE 3.1200 2.8600 2.6600

100 SWEDISH KRONA 50.7200 46.1300 45.9300

100 THAI BAHT 11.1100 9.4100 9.0100Source: Malayan Banking Berhad/Bernama

Nov 2, 2009EXCHANGE RATES

KLCIPoints

marketsummaryNOV 2, 2009

SHARE prices on Bursa Malaysia closed easieryesterday as market players took cue from aweaker Wall Street last Friday, dealers said.

The FBM KLCI declined 1.47 points, or 0.118%,to close at 1,241.76, dragged down by Genting,RHB Capital, AMMB Holdings and Sime Darby.

The FBM KLCI had opened 5.06 points lowerat 1,238.17. Genting fell nine sen to RM7.15,RHB Capital declined 14 sen to RM5.25, AMMBHoldings decreased nine sen to RM4.64 and SimeDarby lost four sen to RM8.85.

Despite the current downtrend, a dealer saidthe upcoming listing of Maxis is likely to providethe much need catalyst for the local bourse.

It will not only attract local investors but also

international as investors are hunting for goodshares, he said.

TA Securities in a research note yesterday said

the upcoming listing of Maxis on Nov 19 is anotherindex catalyst although the Initial Public Offer-ing appears pricey as market is likely to attach apremium to this quality stock.

It said corporate results reporting season willenter its final leg in November and could act as astrong support for any immediate term correctionas earnings are expected to be better on quarter-on-quarter basis.

Losers led gainers by 411 to 242 while 212counters were unchanged and 408 untraded. Bernama

FBMEMAS 8,321.88 -14.85FBM-KLCI 1,241.76 -1.47INDUSTRIAL 2,666.52 -1.43CONSUMER 365.98 +0.72INDUSTRIAL 92.72 -0.27CONSTRUCTION 232.10 -0.54TRADING SERVICES 160.01 -0.42FINANCE 10,526.79 -8.38PROPERTIES 791.57 -1.13PLANTATIONS 6,071.86 -16.22MINING 308.02 -2.03FBMSHA 8,397.71 -16.04FBMACE 4,300.14 -5.55TECHNOLOGY 17.58 +0.41

1.074bil RM1.142bil

INDICES CHANGE

TURNOVER VALUE

KL shares close easier

US lender CIT files

for bankruptcyWASHINGTON:CIT Group,one of the largest small-busi-ness lenders in the UnitedStates, has filed for bankrupt-cy, with its board approving aprepackaged restructuringplan to shed US$10 billion(RM34 billion) in debt.

After being rescued fromalmost certain collapse inJuly following a US govern-ment rejection of a bailoutplea, the company had strug-gled to stay afloat, receivingan emergency loan of US$4.5billion as recently as Oct 28.

But when a comprehen-

sive debt-exchange planfailed last month, the boardof the company, which raninto financial problems aftera home mortgage meltdownplunged the country into itsworst crisis in decades, hadbegun reorganising its capitalstructure ahead of a possiblebankruptcy.

With the overwhelming support ofits debt-holders, the board of directors

voted to proceed with the prepack-aged plan of reorganisation for CITGroup Inc and a subsidiary that willrestructure the companys debt andstreamline its capital structure, thecompany said in a statement after theboard met on Sunday.

CIT aims to emerge from courtprotection by the end of the year, itsaid.

Under the plan, CIT expects toreduce total debt by approximatelyUS$10 billion, significantly reduceits liquidity needs over the next three

years, enhance its capital ratios andaccelerate its return to profitability.

But not all experts shared the com-panys confidence.

Theres no guarantee, Scott Peltz,managing director of the corporate re-structuring group at RSM McGladreytold The Washington Post about theprospects of CITs recovery.

He said it would be crucial forthe restructured company to earn aninvestment grade rating.

Without it, theyd still have anunworkable capital structure, Peltzis quoted by The Postas saying.

In the voluntary Chapter 11 fil-ing with the US Bankruptcy Courtin Manhattan, CIT reported total

assets of US$71 billionand liabilities of nearlyUS$65 billion, making thebankruptcy the fifth larg-est in US history, behindLehman Brothers, Wash-ington Mutual, WorldComand General Motors.

Founded in 1908, CITis a Fortune 500 companythat has emerged as thelargest lender to the USretail sector, althoughit also operates in theaeronautics, defense andrail transport sectors, aswell as with technology

giants Dell, Microsoft andToshiba.

Its bankruptcy high-lights the precariouscondition of some USfinancial giants as thecountry emerges fromthe deepest recession indecades.

The companys collapse, econo-mists have said, would be a sharpblow to an economy struggling to getback on its feet.

CIT Group chairman and chief ex-ecutive Jeffrey Peek, who has alreadyannounced he is stepping down at theend of the year, said the plan wouldallow its subsidiaries, including CITBank in Utah state, to continue opera-tions through the reorganisation.

In December, CIT Group receivedUS$2.3 billion from the US Treasury aspart of an emergency rescue package,but the taxpayer money is expectedto be wiped out in the restructuring. AFP

Asian markets tumble on Wall Street loss, US bank failureHONGKONG: Asian shareswere hit yesterday as a diveon Wall Street at the end of theweek was compounded by thebankruptcy of US bank CIT,stoking further fears over thestrength of the global economicrecovery.

Dealers brushed aside lastweeks US data showing theworlds largest economy hadmoved out of recession and in-stead focused New Yorks losses,where concerns over the finan-cial sector were compounded byprofit-taking.

Tokyo ended 2.31% off andSydney dropped 2.21%, whileHongkong was 1.72% lower atnoon. Seoul closed 1.37% down.

However, there was a 0.49%

gain midday in Shanghai, whereearlier falls were wiped awayby figures showing an improve-ment in Chinas manufacturingsector.

Wall Street plummeted2.51% on Friday as confidencewhipped up by the gross do-mestic product data was wipedout by worries that CIT Group,one of the largest small-businesslenders in the United States, wasin trouble.

Those fears were realised on

Sunday when the bank filed forChapter 11 bankruptcy with itsboard approving a prepack-aged restructuring plan to shedUS$10 billion (RM34 billion) indebt.

The 101-year-old firm had

struggled to stay afloat in thewake of the sub-prime mortgagedebacle despite being rescuedby a government bailout in Julyand receiving an emergencyloan as recently as Oct 28.

In its filing to the US Bank-ruptcy Court in Manhattan, CITreported total assets of US$71billion and liabilities of nearlyUS$65 billion, making it thefifth largest bankruptcy in UShistory.

It said it aims to emerge from

court protection by the end ofthe year. The move also sparkedfears over the health of the USfinancial system as the economystruggles out of crisis.

Dealers were also moved totake profits after the big gains on

Friday, which capped a week oflosses after the US announcedits economy had grown a better-than-expected 3.5% in the thirdquarter.

However, many analystspointed out that the big rise washelped by the governmentsenormous stimulus measuresincluding the highly successfulcash for clunkers programmeto boost the ailing car industry.

Markets were also nervousahead of monetary policy deci-

sions due this week in the UnitedStates, the Eurozone, Britain andAustralia, as well as key US jobsdata on Friday.

Despite the losses, market-watchers said markets couldhandle the bad news. AFP

Benitezmust notoverlookclear andpresent

dangerpg 39

Global crisis hitting ITspending: Microsoft chiefSEOUL: Companies worldwide are slashing spending oninformation technology because of the global downturn

and will have to learn to do more with less, Microsoftchief executive Steve Ballmer said yesterday.

Ballmer, on a visit to South Korea to promote thenewly-released Windows 7 system, said IT spending rep-resents about half of all capital expenditure in developedcountries such as the United States and South Korea.

With capital more scarce, we know IT budgets aremore scarce, Ballmer told chief information officersfrom local businesses. There is going to be pressure inbusinesses to drive for a new level of efficiency.

Ballmer said the global economy went through a setof once-in-a-lifetime changes last year. AFP